Financial Times | Jonathan Moules
Buffalo became the second-largest city in New York State on the back of one of early 19th-century America’s key engineering feats, the Erie Canal. The wealth of that era is still reflected in the architectural masterpieces that are a source of pride for the city, but Buffalo has recognised that its economic prospects need reinvigorating. The hope among city leaders and businesses is that a start-up community can get it back on its feet.
The case for: Buffalo’s start-up community is building momentum through a combination of events such as Startup Grind Buffalo, work spaces including d!g and Z80, and big projects such as the 43North business plan competition.
Andrew Cuomo, New York State governor, is lending a hand. This month he claimed that his Start-up NY economic development programme, which includes extensive tax breaks, had brought eight businesses to Buffalo that together intended to invest $50m and create 400 jobs in the city.
Buffalo is what is called a “liveable city”. In 2010 the magazine Forbes rated Buffalo the 10th-best place to raise a family in the US.
There is also a large pool of locally trained graduates. The Buffalo region has 23 colleges and universities, with more than 100,000 students enrolled annually.
The cost of living is also much lower than New York City, the state’s better recognised start-up location, 370-odd miles away.
The case against: The quality of crucial infrastructure is a concern. Critics of Mr Cuomo’s attempts at economic development claim that what Buffalo really needs is fast and reliable internet access across the city.
Local heroes: Synacor helps telecommunications and cable service providers set up websites on its managed, hosted platform, enabling their customers to access email, online games, music and streamed television through its TV Everywhere product. It raised $17m in a series C round in 2006 before its initial public offering in 2012, although its share price has halved since then.
GradFly, founded in 2012, gives technical students a way to document, collaborate and explore projects that they and others are working on. Its product, launched at TechCrunch Disrupt NY in April last year, enables students to show the development process of their work from concept to finished product, and allow their professors and classmates to interact along the way.
Show me the money: Several state government programmes have been developed to encourage businesses to set up in Buffalo. Under Start-up NY, companies setting up in certain “innovative zones” in Buffalo, closely tied to higher education colleges, are exempt from New York State taxes. Buffalo Angels raised $1.1m to launch its first fund. Z80 Labs started a $4m fund in 2012.
How easy is it to get to? Buffalo Niagara International Airport serves Niagara Falls, the rest of western New York, northwest Pennsylvania and southern Ontario.
What do the locals say? Andrew Pulkrabek, executive director of 43North: “Locals are willing and wanting to help whenever and however they can, whether it be on developing the business or in helping people get connected to the community.”
Marnie LaVigne, chief executive of Launch NY, a not-for-profit body providing support to early-stage ventures: “Entrepreneurs can really enjoy working and playing at the same time.”