Worcester Business Journal

10 Worcester Business Journal | April 29, 2019 | wbjournal.com B oosters around Worcester are used to fighting to persuade outsiders Central Mass. has much to consider. e same goes for venture capital. Just 1% of venture capital in Massa- chusetts in the past five years has come to Worcester County, according to the industry tracker PitchBook, putting Worcester in the shadow of Greater Bos- ton, which itself is beat only by Silicon Valley and New York City when it comes to attracting venture capital. Economic development and startup BY GRANT WELKER Worcester Business Journal News Editor Worcester County gets 1% of Mass. venture capital, as the region gets creative to support startups Little venture leaders in Worcester – like a lot of other smaller markets outside those largest national hubs – are le looking for other ways to nurture startups, while still pitching to deep-pocketed investors. e Worcester Regional Chamber of Commerce sponsors StartUp Worcester, a competition for funding dollars for budding entrepreneurs. Worcester Poly- technic Institute helps graduates launch companies and invests in them along the way, and the Massachusetts Biomed- ical Initiatives incubator space at WPI's Gateway Park gives affordable space, shared equipment, and management and funding-request guidance. "e trends in Worcester are incred- ibly encouraging," said John Hallinan, chief business officer for the Massachu- setts Biotechnology Council. e Massachusetts Biotechnology Council is based in Cambridge's Kendall Square but works to support the industry statewide, including with an early-stage mentoring program. Hallinan, a Marl- borough resident, said Worcester is an important cluster outside Boston. Making the pitch Timothy Murray, the president and CEO of the Worcester Regional Chamber of Commerce, is used to having to tout his home city. His perspective comes as a former Worcester mayor and a former lieutenant governor who spent his days in Boston's center of gravity. "You have to try changing some per- ceptions of Worcester from 30 years ago or 40 years ago, that it's an old manufac- turing city," Murray said. e pitch oen goes something like this: Worcester is home to more than 30,000 college students, hosts UMass Medical School, and has an express com- muter rail train to Boston. Increasingly, the impending move of the Pawtucket Red Sox to Worcester is mentioned as an example of strides the city is making. Murray said he expects venture capital to make its way to Worcester as more economic development investment is made in the surrounding area. While venture capital can be an im- portant tool for entrepreneurs, startups in the Worcester area are helped in less visible ways, from silent investors to affordable MBI incubator space. MBI, a nonprofit funded by the state as well as through donations and rent, offers shared equipment for firms to keep costs down. It has helped launch Blue Sky BioServices, now part of drugmaker LakePharma, and Coley Phar- maceutical Group, which was bought by Pfizer for $164 million and is now based in Wellesley. A new strate- gic plan for MBI aims to better help startups attract funding, hire the right man- agement or land an acquisition that fits best, said Jon Weaver, MBI's president and CEO. "We look at ourselves as ex- tensions of their teams," Weaver said. Industry offi- cials are working to get more lab and office space in Worces- ter, with today's rents generally too low to make new construction feasible without tenants lined up. At WPI, more funding is going into helping students leading new startups. e school counts 15 active startups, nearly all in Worcester County, including Battery Resourcers, which is developing a lithium battery recycling technology. ose companies raised more than $14 million combined in fiscal 2019, said Todd Keiller, the director of WPI's Office of Technology Commercialization. WPI is building more of a culture of invention, including supporting startups however it can, Keiller said. "You wouldn't see venture capital mon- ey yet," he said of WPI-born startups, "but you will soon." Some venture capital does flow into the Worcester area, even if not nearly at the levels Boston area firms see. Last year, RxAdvance, a Southborough pharmacy benefit manager, took in $50 million, and Worcester manufacturer Anchor Labs received $17 million. SimpliVity, a West- borough information technology firm now part of Hewlett Packard Enterprise, received $175 million. Todd Keiller, director of the Worcester Polytechnic Institute Office of Tech- nology Commercialization, tries on the headgear from startup In Virtu Data Solutions at The Venture Forum event at WPI in April. PHOTOS/MATT WRIGHT

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