In this issue of Insights, we talk with Jack McGowan about startup development. With years of experience on the Insyte team, Jack has long been dedicated to helping entrepreneurs evaluate, develop and fund their business ideas. Here, he discusses the role he plays on the Insyte team, with his clients and in the region’s startup community.
People know Insyte for consulting with manufacturing companies, but you also do a lot of work with the startup community. Can you talk about that?
Insyte has worked with startups since its founding more than 30 years ago. For many years, we managed the UB Technology Incubator on Sweet Home Road in collaboration with UB. I have served as Executive Director of the Western New York Venture Association since I joined Insyte in 1994 and other Insyte staff provide administrative support. Insyte also manages the WNY Business Development Fund with our partners at Empire State Development, the Erie County IDA and UB. We also help companies apply for R&D funding through the federal Small Business Innovation Research (SBIR) funding program. Insyte’s been helping startups since the days when virtually no one else was.
How has the entrepreneurial ecosystem changed over the years in Western New York?
There’s a lot more emphasis on entrepreneurship now and there’s more money and resources behind it. Twenty years ago, you had the UB Incubator which was was really the only technology-focused incubator; Insyte managed that in partnership with the university. About 15 years ago, UB hosted the first business plan contest, the Henry A. Panasci Jr. Technology Entrepreneurship Competition; now there are multiple pitch events and competitions in the region. The Bright Buffalo Niagara Forum continues to grow. We’ve got 43 North, which is the world’s largest business plan competition. There’s the New York State Student Competition. UB has startup programs like eLab and the Student Sandbox. 43 North, Z80 Labs and VCAMP have accelerator programs. None of these existed five or ten years ago. These are all things that have come on line in the relatively recent past. It’s great to see. Insyte’s been a key part of that, working with all these various entities in very much a collaborative role.
What do you think this increased interest in entrepreneurship indicates about the changing business community in Western New York?
It shows we understand that we need to do more than attract established companies from out of town—the traditional economic development model—and we need to start attracting new ones as well if we’re going to grow the local economy. It shows that people from various sectors of the community—millennials who want to make a difference; government; educational and research institutions; forward-thinking companies; and angel investors—are working together to grow our region.
What are some pointers that you regularly provide to startups?
There’s a lot more to starting and building a successful business than having a great idea. The idea or technology needs to be unique and innovative. It needs to fill a customer need or want. Inventors or technologists often only consider the product from their own perspective as opposed to the customer’s perspective. You need a team. A lot of people view being an entrepreneur as going out and doing the heroic job of making a company successful on their own. Good investors can provide money and guidance but they also need to own an appropriate share of the business. Many entrepreneurs believe the sequence for starting a business is to come up with an idea, develop a business plan, raise money and then execute the plan and prove that the idea is valid. But most investors are going to want to see that you’ve begun to execute, that you’ve done that testing and validation before they put their money in.
How valuable is Insyte to the startup community?
I think that Insyte provides value through its business experience and willingness to collaborate with all of the parties in the startup community. The advice that we provide helps startups increase their chances to attract investors and build successful businesses. We helped build the WNY Venture Association and the Buffalo Angels, which invested more than $1 million in local companies last year. We’re frequently invited by our ecosystem partners to serve as presenters, judges or mentors in their events or programs, so we must be adding value.