NEW YORK STATE URBAN DEVELOPMENT CORPORATION d/b/a ...

funds used to capitalize Innovate NY. The Fund’s objective is to invest in seed stage businesses
through regional and/or industry focused Investment entities to be selected by and contracted
with the Corporation. Investment priority by these entities shall be given to New York Statebased
seed stage businesses involved in commercialization of research and development or
high technology manufacturing.
B. The Project
The Corporation issued a Request for Proposals (“RFP”) on December 23, 2011 via an
advertisement in the New York State Contract Reporter and direct mail/email distribution to
private for-profit or non-profit investment managers, investment funds, regional and local
economic development organizations, technology development organizations, and research
universities that make seed stage equity or quasi-equity investments in New York State
companies.
In response to this RFP, the Corporation received 21 submissions requesting a total of
$116 million in funding. One submission was disqualified due to it not being a valid applicant.
Pursuant to the competitive review and selection process, six (6) investment entities have been
selected by a selected review team consisting of ESD staff and one NYSERDA representative
with investment expertise to receive a total of $25 million in program funds and up to $1.5
million from SBTIF. Each selected investment entity must secure private matching funds
through additional direct investment or co-investment with other investors at a rate of 2:1 on a
portfolio basis.
Submissions were evaluated on criteria including, but not limited to, the applicant's:
(a) track record of success in raising investment funds and successfully investing them; (b)
financial and management capacity to source deals, perform due diligence, evaluate the
commercial potential of emerging technologies, and to provide management expertise and
other value-added services to beneficiary companies; (c) demonstration of need in target
market for seed stage investments in target sectors; (d) ability to secure the required non-State
matching investment; (e) competitiveness of the proposed compensation structure; (f) ability to
secure partnerships with local or regional stakeholders; (h) ability to direct funds to
underserved populations and communities; and (i) investment record and capacity to invest in
the State; and, (j) other criteria determined to be relevant to making investment decisions
consistent with the purposes of the Fund. All applicants had to specify particular industry
sectors and/or regional or other investment strategies.
The Corporation and each investment entity receiving program funds shall enter into
one or more written agreements (including limited partnership agreements) governing the
Corporation’s investment. After an investment entity is under contract to the Corporation, the
Corporation may award additional program funds to an investment entity without an additional
solicitation. The Corporation reserves the right to make reallocations of funds after the initial
awards if selected Investment entities do not meet the program performance requirement as
set forth in the program investor agreements.