43North will move its operations from the Buffalo Niagara Medical Campus to Seneca One tower with help from a $1.5 million Empire State Development incentive, it said Thursday.
Business competition winners based in the Innovation Center will move to the tower, along with Techstars Buffalo, a global startup accelerator; Z80 Labs, a startup incubator; and 43North's 11 staff. Another eight competition-winning companies would join them in 2020. Right now, 16 of the competition’s 44 alumni are located at 43North’s headquarters.
The move will more than double 43North's space, taking it from 7,000 square feet to 15,000 square feet. 43North had outgrown its current space at the Innovation Center and begun renting additional space nearby in the University at Buffalo’s Downtown Gateway building.
The relocation will make 43North the second major tenant of the tech hub planned for the 38-story Seneca One building, built around technology operations that M&T Bank Corp. plans to locate within the tower beginning later this year.
Relocating near M&T Bank's tech hub could attract more financial technology companies to the competition, helping to “expand the entrepreneurial ecosystem” and raising the region’s profile as a “rising innovation and technology hub,” 43North said.
“It’s important to create density, to have people physically colliding. It helps foster strong relationships, enhances problem-solving and increases the success and growth of these companies,” said Alex Gress, 43North president.
It will also help attract more tech firms to Seneca One, said building developer Douglas Jemal.
"You’ve seen what’s happened downtown on Canalside. You’ve seen the commitment we’ve made to Seneca One. It’s all there," Jemal said. "The more positive beacon we send out, the more we can build a vibrant technology corridor."
43 North will occupy the entire 24th floor, likely beginning in December. M&T is taking floors 7 to 22 for its tech hub.
Officials voted to approve the grant Thursday morning at a meeting of the New York State Urban Development Corp.
43North requested up to $1.5 million, to be used for the design, construction and renovation work that would allow it to expand its incubator space, according to the application. The organization needs more room because the latest competition winners have been at a later stage in their development; they have larger staffs, hire faster and grow more quickly, it said.
M&T has begun a technology development program that gives select new employees a wide-ranging view of operations. The inaugural class comprised about 50 college graduates.
The bank aims to hire 1,000 "technologists" over the next three to five years. Some new hires might be current contractors that will be converted to permanent employees. Others will be brand new to M&T.
M&T is working to reduce its use of consultants and contractors, in favor of using more permanent tech employees, M&T chief financial officer Darren King told analysts on a conference call. The bank pays a premium for contractors and consultants, and those temporary workers do not have the same incentive to stay with the company that permanent workers do.
Winners of the next 43North business competition will be chosen Oct. 30 during a live pitch event at Shea's Performing Arts Center. The first place winner receives $1 million in venture funding, seven runners-up receive $500,000 prizes. All winners also receive free incubator space for one year, mentorship and access to other business incentive programs. The initiative was created by Gov. Andrew M. Cuomo in 2014 as part of the Buffalo Billion initiative.