New Startups to Lose Seed Funding
The tech community in Florida is in despair after Florida Governor Rick Scott stopped the allocation of state funds for helping startup companies.
In the budget approved for fiscal-year 2018, Governor Scott vetoed $409 million worth of funding to various items. One of the items that has been dropped from the budget was $5.5 million for the Florida Institute for the Commercialization of Public Research (FICPR). The money was being used by the institute to provide seed funding to new startups in the state.
Following the state’s funding cuts to FICPR, the institute has been forced to lay off some of its staff in order to survive the cash crunch.
The institute had been receiving $5.5 million since 2013, and had been using it to help new startups get off the ground. The institute has funded 71 startups , many of them in the last few years. This has helped create more than 4,000 jobs in the state, and those positions have been averaging $76,000 in salaries.
The institute had been helping establish Florida-based tech companies that could create high-paying jobs in the state. In the absence of the state appropriations, the institute’s seed fund will no longer be able to fulfill aim of investing in emerging companies.
The Chief Operating Officer of the institute, Jane Teague, said that FICPR was currently working with about 20 companies to get them ready for their first round of seed funding. Their future may now be in limbo.
She added that the Institute had funded various startups that have gone on to raise millions of dollars worth of funding from venture capitalists. “We’ve put to work $23 or $24 million but our companies have gone on to raise $150 million,” said Teague. “[T]hey are working on things like curing cancer and diagnosing diseases early.”
Just a few of the startups funded by FICPR are Kairos AR, Inc., Vigilant Biosciences, Inc., Biscayne Pharmaceuticals, DealCoachPro, BlinkBio, and Ovation Diagnostics.
FICPR is not the only institute whose funding is being slashed by the State of Florida. A number of other tech-focused incubators run by universities are also facing funding cuts.
FICPR is hoping for the funding to resume in the next fiscal year.
“Tech funders, startups already feeling sting of state budget cuts,” Miami Herald, July 10, 2017.