Written By: Judy Albers, Chief Operating Officer, Excell Partners, Inc.

Upstate New York is rich with stories of great inventors and entrepreneurs. George Eastman invented dry plate film photography and founded Eastman Kodak Company in Rochester in 1880. Willis Carrier invented air conditioning and established Carrier Corporation in Syracuse in the 1930s. Thomas Edison merged Edison General Electric Company with a competitor to form General Electric Company in 1892, which he headquartered in Schenectady. Throughout the region, there are many great stories of entrepreneurs and the companies they built have had a tremendous impact on the Upstate economy. But times have changed. In the last couple decades, many of our major corporations, started long ago, have downsized significantly or sent manufacturing overseas and our regional economy has suffered the consequences.

But there is much hope and excitement for the future of the Upstate NY economy. Throughout the Upstate region, we have many world-class universities with brilliant scientists working on new inventions every day. Collectively, our Upstate universities and research centers invest over $1B annually in the research and development of new technologies. There is now a growing interest in tapping into our universities to extract more economic development value from this R&D. Community stakeholders are starting to ask: Can we commercialize more of these inventions? Are there foundational technologies being developed that could form the basis of new start-up companies? Is there another George Eastman, Willis Carrier, or Thomas Edison among the scientists within these grand institutions?

I am proud to be a part of one organization that is determined to find answers to these questions: the Pre-Seed Workshop – NewYork (PSW-NY). Three years ago in Rochester, a small group of committed individuals decided that creative methods were needed to reach deep within the universities to find exciting technologies and potential entrepreneurs. They were acting upon the following assumptions. First, that there were inventors in the universities that weren’t sure if their inventions were commercializable or not because as scientists, they simply didn’t know the business questions to ask. Second, there were many individuals in the community with expertise in business, finance and law that understood how to commercialize inventions but they were physically disconnected from the scientists. And third, if all this complementary brain power could be brought together for an intensive, hands-on, two day workshop to analyze and explore the start-up potential of a new invention, the result could potentially be (as one workshop participant described it) “magic”.

Now, with 49 major participating organizations, PSW-NY is one of the largest grass-roots initiatives in New York State facilitating the growth of entrepreneurship and the creation of start-up companies across the region. Over the last three years, the PSW has mobilized and brought together the intellectual capital and expertise within: 14 Major Universities, 6 Business Schools, 7 Economic Development Agencies, 8 Venture Capital Groups, 7 Law Firms, 2 State Agencies, and 5 Accounting Firms, Banks, and Cluster Organizations. They have held 14 Pre-Seed Workshops in 6 host cities with over 450 Participants in which 79 “hi-tech ideas” have been analyzed by 79 teams to create 26 high-tech companies. Established host cities include Buffalo, Rochester, Syracuse, Albany, Ithaca, and Geneva. Potsdam and NYC are also being developed as host sites.

The formula for the workshop is simple. Over a period of two days, the two PSW developers and facilitators ask a series of twenty key questions that need to be addressed in trying to decide if an invention has commercial potential or not. A team works on the answers. The team consists of an inventor, another technologist, an MBA student, a corporate or patent attorney, a university-based technology transfer officer, and a business coach from the community. There may be six to eight teams per workshop which capitalize on the high-level talents of young and old, technical and non-technical, and which mix participants from all over the Upstate region. Everyone rolls up their sleeves.

As the teams work to answer the 20 key questions, they are actually building a 15 minute presentation that they deliver at the end of the workshop to a panel of venture capital investors. These investment professionals then provide feedback on whether the team has a business case, and if so, whether the business case is “investable”. At the end of the workshop, the teams are advised on the next steps they should take if they plan to continue building a high-tech start-up company and how to best utilize the many resources available in their respective communities.

Earlier this year, a 28 year old, recently-minted PhD from the Aerospace Engineering Department at Syracuse University named Joe Kummer participated in a PSW at the Syracuse Technology Garden. As part of his doctoral work, Joe invented an unmanned aerial vehicle which, because of its novel design, had load carrying capacity unparalleled in the aviation industry. He and his business partner knew they wanted to start a company but they had no plan or focus. The PSW helped launch the company in the right direction. Joe is now the president of his company called Propulsive Wing. His business partner has decades of experience, capital, and contacts into the aviation industry. Together they are working to move the technology into the marketplace

Last year, Dr. Lionel Coignet, an Associate Professor of Oncology at Roswell Park Cancer Institute attended a PSW in Buffalo to investigate the marketability of a revolutionary new blood test he invented which predicts the risk of metastasis for patient with certain types of cancers. Persuaded that the market opportunity was significant, Dr. Coignet pressed forward after the PSW to find business managers to help him fully flesh out the business plan. They also helped him to raise a substantial amount of local as well as outside Angel capital. While maintaining his status at Roswell, Dr. Coignet is now serving as the Director and Chief Scientific Officer of the new Biotech Company he founded called PersonaDX. About 18 months after the PSW, the ribbon-cutting ceremony was recently held on their new facility.

Professor Anil Netravali from Cornell’s College of Human Ecology and Pat Govang, then Director of the Cornell Center for Materials Research attended a PSW together in Ithaca in Spring 2006. Professor Netravali had developed new biodegradable, environment-friendly materials that are stronger, lighter, cheaper, and “greener” than conventional petroleum based plastics and wood composites. Within nine months after the workshop, Pat had committed to becoming the full-time CEO of a new Cornell spin-out called e2e. Within a year, Pat was negotiating joint ventures with major industry player in the Sports Board and Furniture Manufacturing Industries. Within a year and a half, Pat had closed on a major investment round syndicated among three Upstate venture capital firms.

These are just a few example of start-up companies “seeded” at the PSWs in Rochester, Buffalo, Albany, Ithaca, Geneva and Syracuse. Since September 2004, 26 for-profit ventures have been “seeded” across the state with the potential to create wealth and jobs in the Upstate region. Many have gone on to win local, national, and international business plan competitions. (PSW Alumni were among the finalists and winners of every single Regional Business Plan competition held across Upstate NY in Spring 2007.) Many have received Small Business Innovation Research (SBIR) funding. Many have secured seed and venture capital. Many inventors found experienced business, finance and legal professionals through the PSW to help them move forward with their start-up companies.

At this early stage, these are still very high-risk ventures. Proper support will be required within each community, particularly from our local incubators and angel and venture investors, to nurture these companies through their growth phases. But our seed companies are no different from the seed stage company formed in Boston, Silicon Valley, Austin, or Research Triangle Park. These areas have successfully developed a robust infrastructure for supporting their start-ups. Our infrastructure has grown tremendously within the last ten years and must become even more robust to support our start-ups.

In any region, of the companies started, not all will succeed long-term but the companies that “hit big”(and statistically, some of them will) could potentially have a tremendous impact on the Upstate economy! Bravo to those brave inventors who put their careers and personal savings on the line to start these companies. Bravo to the community members and organizations rallying to support them. And bravo to all those who participate in the PSW-NY consortium as they help to cultivate the next generation of entrepreneurs and start-ups in the Upstate NY Region.