AUBURN — Cayuga County entrepreneurs and startups looking for space to manufacture their products and receive technical and financial assistance may get a new place to call home by mid-2016.

The Cayuga Economic Development Agency (CEDA) is working to develop a new business accelerator for small companies in need of flexible manufacturing space to develop their products.

Andrew Fish, executive director of CEDA and the Cayuga County Chamber of Commerce, envisions a 30,000-square-foot facility for what is being called the Innovation Business Accelerator (IBA), “with a good two-thirds of that being flexible, adjustable manufacturing and assembly space.” The planned launch date of the facility is June 2016.

Such space is in demand, according to Seth Mulligan, VP for innovation services at CenterState CEO, and a management and finance mentor at the Tech Garden business incubator in Syracuse. He notes that there is not enough space in the region for product innovators. For example, the 33,000-square-foot Tech Garden, and its recently launched 18,300-square-foot Tech Garden II, is all office space, focused primarily on software development. It’s also mostly full.

CenterState is acting as a consultant to CEDA (an effort spearheaded by Mulligan) during the planning and establishment phases of the IBA project. “Our job really is to help them identify feasible sources of funding and package those” and then step aside so Andrew Fish and his team can decide what funding to chase, says Mulligan. He envisions bringing the same motivators and rapid innovation techniques used in software incubation to product development at the IBA in Cayuga County.

Manufacturing space in the planned facility could be used to produce goods made of plastic, metal, glass, or other materials, and for the production of value-added agriculture and food products, says Fish. CEDA has yet to choose what specific business sectors the IBA will target. The most growth the agency has seen in the region is in plastics manufacturing, according to Fish, but other sectors could also take part.

“Interestingly enough, we have this whole segment about tourism and the environment, and how that ends up being part of the play; we don’t really know because [the IBA is] obviously not an incubator for tourism-related activities, but perhaps there is something there,” Fish says. “We’re trying to sort through all of that.”

Finding funding

Attaining funding is a priority. Fish says CEDA has the money it needs to implement its plan over the next 16 months until the intended launch-date. Part of that plan is acquiring the $1.5 million needed to actually launch the IBA.

Three major sources of funding have been identified by CEDA: about one-half to two-thirds of the total funding would come through federal and state grants, and the remaining portion would come from a combination of local philanthropic community foundations and the local business community, according to Fish. Businesses willing to help could benefit in a variety of ways that Fish says are still being explored, such as naming rights or a lifetime association with the IBA.

“Based upon the programs we know exist, that have funded things like this throughout the country and throughout the state; we’re pretty comfortable with that mix,” he says.

The biggest single source of potential money that CEDA will chase is from the federal government’s Economic Development Administration (EDA). Fish says the EDA “has dollars in the budget every year for accelerators and incubators.” “They give out very large sums of money nationally every year for that.” 

CEDA also plans to submit the IBA project to the Regional Economic Development Council program to seek funds through the upstate revitalization competition announced by Gov. Cuomo last month.

“We’ll certainly be engaging Congressman [John] Katko when it comes to the federal dollars that we’ll be going after,” says Fish. “Certainly any connections that he has will be very helpful, as well as Senator [Chuck] Schumer and Senator [Kirsten] Gillibrand.” Fish adds that CEDA will also engage with the state legislature for tapping state funding.

Just as important as funding to the success of the IBA, says Fish, is community support. “If people don’t understand what we’re trying to do, if people aren’t behind this, if we don’t have our stakeholders behind the fact that it’s going to take us time and energy to put effort into this, that can derail us just as fast” as not getting the necessary funds. “We’ve really got to do a good job of engaging the community, not only in Auburn and Cayuga County, but in Central New York as a whole,” Fish says.

A possible major extension of the IBA being explored is a $3 million seed fund, developed by project partners and possibly supplemented by grant money, to make seed investments in the Innovation Business Accelerator’s startups. Fish’s primary interest in the seed fund is as a means to keep businesses that graduate from the IBA — a process he says would average two to three years — in the region, a caveat intended to prevent newly created jobs from leaving. Fish says he also would like to see portions of the seed money designated for certain business sectors.

“We would not try and create a whole venture-fund management team and everything just for the $3 million. I mean, that’s a small pot to try and have an entire team around for making those decisions. So what we would try and find is a partner within the state to basically take those funds, manage those funds, and we would just have some caveats that just go with it,” Fish explains.

Involving existing businesses

CEDA also plans to incorporate a sort of equipment-time-sharing program that would benefit not just startup businesses, but also established businesses.

The IBA would ideally have associate members consisting of existing businesses in the area with manufacturing capabilities. Those businesses would identify times when they aren’t using their manufacturing equipment, and allow IBA startups to come in and use the equipment to make their own products. On the flipside, the established businesses would be allowed to use equipment owned by the IBA when it isn’t in use by the startups. 

“It wasn’t just startups that were coming to me way back when we first started this process,” says Fish. “It was [existing] businesses themselves that were coming to me,” saying they have these ideas for new products, unrelated to their current business, that they want to explore. But, says Fish, these businesses said they needed time, resources, help with marketing, or other support that would allow them to move forward with their ideas and expand.

“It’s companies that are able to make those kinds of investments and make those kinds of leaps forward [that] we’re also looking at targeting,” says Fish. IBA organizers hope to engage Cayuga County product manufacturers such as Currier Plastics, UPSCO, Cayuga Milk Ingredients, and others in the effort.

Finding a site

Identifying a location for the IBA in the Auburn area in the first half of this year is another priority. Specific locations have not been identified yet, but since announcing the IBA project at the Cayuga County Chamber of Commerce Economic Forecast Luncheon on Jan. 29, Fish says he has received several phone calls from people suggesting properties for CEDA to look at.

“I even had one individual, or corporation, come forward and say ‘Hey, if we donated this, would that work?’ So there are a lot of opportunities out there,” Fish says, “but we have to pick the one that makes the most sense.”

Fish says trips to Pittsburgh and Boston with Seth Mulligan and the advisory board are planned to visit other facilities that play a similar role as the IBA will, to learn some of their best practices. They also want to learn about the other facilities’ manufacturing equipment.

Equipment purchases, says Fish, will mostly be made after CEDA has talked with prospective tenants to see what suits their needs. But in the visits to Pittsburgh and Boston, Fish will be looking for what he calls “common denominators,” or pieces of equipment that are needed frequently and that also aren’t readily available to small businesses. Such equipment CEDA will explore purchasing without first consulting prospective tenants, says Fish, “because we know that [equipment is] going to touch on 80 percent of the opportunities that come through our door.”

While the focus of the IBA will be on production capability, with approximately two-thirds of the IBA floor space expected to be devoted to manufacturing, Fish says much of the remaining space will be allocated to office space that will help those small companies that aren’t ready for production yet.

Fish projects a competitive process for companies to qualify for admittance to the IBA.

“The entire purpose of why we’re doing this is so that we are — we are increasing drastically the success rate of the companies that are starting up,” said Fish.

“This isn’t about subsidized space. If incubators or accelerators become about subsidized space, you’re done,” he argues. “It has to be sustainable, so all these things that we’re talking about are not going to be freebies.”

He also emphasized that the IBA is about filling gaps in upstate New York’s incubator landscape. “We’re not here to compete with High Tech Rochester, or the Tech Garden in Syracuse, or the incubation facilities that they’re bringing online in Cornell. We’re here to fill a different niche,” says Fish.

He says he plans to ask for input from local business owners and to give updates about the IBA project over the coming months.