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An Overview

Cornell Tech officially launched 3 years ago, and since then the number of startups that were formed at Cornell Tech and spun out have grown at a rapid pace. This report provides a detailed view into Cornell Tech’s spinout activity and how the campus is transforming universities’ role in the creation of startup companies.

29Companiesformed and spun out between January 1st 2014 -August 1st 2016

and over 100 employees built these startups

Founders

62

12 of pre-seed – seed funding raised in less than 3 years

Million Dollars

93 are headquartered in NYC, while 7% are headquartered in San Francisco

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Startups per Year

The rate of startups formed at Cornell Tech is growing rapidly. Between 2014 and 2015, the total number of active spinouts increased more than 5 times and in 2016 we have already seen an increase greater than 2 times the number of startups in 2015. The graph below shows the growth of startups at Cornell Tech.

2014 2015 2016

8

0

16

24

32 Spinout Companies

21 CompaniesCurrently Active

29 Total number of spinouts

17 spinouts formedin 2016 alone

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Spinouts by Program

There are several hubs at Cornell Tech where startups are formed, and those founders include master’s students, PhDs, faculty, postdocs, and alumni. The number of startups being formed by Runway Postdocs and Startup Studio teams are increasing at an accelerated rate. Between 2015 and 2016, the number of Runway Postdoc spinouts have increased 150% and Startup Studio spinouts have increased by 20%. Of the total startups formed, we have seen the most startup activity come from the Runway Postdoc program and Startup Studio, followed by alumni.

Alumni: Recent Cornell Tech graduates

Studio: Masters students (MBA, CS, LLM)

Runway: Postdocs that are commercializing deep tech

2

4

6

8 Spinouts

2014 2015 2016

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Working Across Industries

There are 7 focus areas that have a!racted more than $1 million in funding and are generating the most jobs—these are areas where more than 10 people per team are actively working to build companies. These focus areas are Wellness, IoT, Big Data, Computer Vision, applications focused on parents, Machine Learning, and Mobile technology.

Wellness

IoT

Big Data

Computer Vision

Parents

Machine learning

Mobile

Developer platform

Research

Finance

Urban Development

Ecommerce

Marketplace

Health

Food

Communication

Productivity

Education

Media

Robotics

Pets

Sports

Recruitment

Bots

Fashion

Manufacturing

VR/AR

Dollars raised 0 1m 2m 3m 4m 5m 6m 7m 8m 9m 10m

People hired 0 4 8 12 16 20 24 28 32 36 40

People hired

Dollars raised

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Building a Community of Founders

Cornell Tech is dedicated to fostering pioneering leaders of the digital age, and one way we are keeping this promise is through a campus culture that produces successful startup founders. Since 2014, 62 startup founders emerged from Cornell Tech. At this rate, Cornell Tech is on track to building an influential and tightly connected community of founders that will build the next wave of transformational startup companies in New York City.

2014

2015

2016

Pre-existing Founder

New Founder

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Different Types of Founders

The founding teams of Cornell Tech spinouts ranged from solo (1) founders to four (4) founders. Most of the spinout teams are founded by 2 co-founders, while teams that are founded by 3 people raised the most money from angels and venture capitalists. Majority of the teams founded by solo founders are from the Runway Postdoc program. The Runway Postdoc program has been focused on identifying postdocs who have IP that can be commercialized. Leaders of Runway and entrepreneurship at Cornell Tech are currently exploring opportunities for Runway postdocs to organically build relationships with potential co-founders while their companies are incubated on campus. Below is the breakdown of Cornell Tech teams by number of founders and funding.

4

8

12

16 Teams

Number of Founders per Team

1 2 3 4

Alumni

Studio

Runway

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Strong Teams Make a Difference

The optimal founding team sizes from Cornell Tech have been teams with 2 – 3 co-founders. On average, solo founders raise slightly more capital than teams with 2 founders; however, on average solo founders have to recruit 3 new employees in the early days, which has a higher opportunity cost (i.e. cost of equity and/or capital ) than teams with 2 founders that recruit one new person. On average, teams founded by 3 people raise significantly more capital than any other team size and only recruit an average of 2 additional people to work on the company in the early days. Founding team sizes of 4 people underperform in fundraising and on average still require an additional person to join the team.

$300k1

$600k 2

$900k3

Raised $1.2m 4 People Hired

Number of Founders per Team

1 2 3 4

Average People Recuited

Money Raised since Aug.

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29 Companies Raised Over $12 Million

Over the past two years, the average pre-seed – seed round size for Cornell Tech startups has increased rapidly. We saw a 1.2x increase from 2014 – 2015 and a 3.3x increase from 2015 – 2016. In 2016, the average funding for a Cornell Tech pre-seed – seed stage spinout was $629k. We have seen majority of the funding for these companies come from family, friends, angels, and Cornell Tech. These companies are still very early in their history—the oldest startups were founded just two years ago—and we expect the average funding per company to continue to increase over time.

4

2

6

10

14

8

12

16 Teams

0

100k

100k

500k

500k

1m

1m

10m

Total Investment

Alumni

Studio

Runway

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Key Learnings

Just 3 years into building a spinout culture at Cornell Tech, we have begun to learn what is working and what isn’t working. The campus and spinout culture are constantly evolving, and it is becoming a reliable destination for the development and growth of startup activity in New York City. We regularly reflect on our key learnings, and use those learnings to improve our startup culture. Below are some key insights:

The number of founders at Cornell Tech is growing rapidly, and as a result there is an active community of alumni building startups. As the alumni community continues to grow, Cornell Tech will see greater demand for co-working space, events, and resources.

Growing community of startup founders at Cornell Tech

While at Cornell Tech and upon immediate spinout, startups are raising the most capital from family, friends, founders, and non-institutional angel investors. As we continue to build support for spinouts, we are prioritizing opportunities to get our teams exposed to non-institutional angel investors, and organizing opportunities for startup founders’ networks to see external validation of their success.

Origins of initial funding are family, friends, former co-workers, founders, angel investors, and Cornell Tech

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Key Learnings

While at Cornell Tech and upon immediate spinout, startups are raising the most capital from family, friends, founders, and non-institutional angel investors. As we continue to build support for spinouts, we are prioritizing opportunities to get our teams exposed to non-institutional angel investors, and organizing opportunities for startup founders’ networks to see external validation of their success.

Optimal team size is 2–3 founders

The most active hubs of startup formation and development at Cornell Tech are the Runway Postdoc Program, Startup Studio spinouts, and alumni. We have learned that there are resources in each of those hubs that are materially valuable to the other hubs. To achieve be!er collaboration, influence shared learning, and prepare to operate at greater scale, Cornell Tech plans to consolidate resources across the three hubs.

Our first step is to hire a Director of Runway and Spinouts. The new director will not only run the Runway Postdocs Program, but also organize spinout clinics and resources that all startup founders can benefit from while at Cornell Tech.

Consolidation of on-campus startup resources

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Key Learnings

Institutional seed and Series A investors continue to monitor Cornell Tech startups, and a few have funded the fastest growing seed stage spinouts. Because many of Cornell Tech’s startup are not yet at the stage for later stage funding, we have developed an investor brief—the brief highlights the recent startup spinouts—that is sent to top institution investors and angels that are in the Cornell Tech network. We have seen a positive response, several of those investors have proactively reached out to our teams to discuss opportunities to invest and add value.

Positive response from institutional seed investors

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This Year’s Studio & Postdoc SpinoutsStartup Studiowww.bowtie.ai

A plug and play chatbot solution for any business, on any platform. We want to do for bots what squarespace did for websites.

Runway Postdocwww.cityhive.net

A software engine of the on-demand economy. City Hive is a true enabler of efficient e-commerce for the benefit of producers, merchants, and consumers alike.

Runway Postdoc

Code Ocean accelerates innovation by making state-of-the art scientific research accessible and useful.

Startup Studiowww.gitlinks.com

Helps organizations manage and monitor their open source software usage and assists them with making the best product decisions.

Runway Postdocwww.innovatively.co

Makes sense of public data to deliver comprehensive information on markets, companies and products in the healthcare and life sciences industries.

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This Year’s Studio & Postdoc SpinoutsRunway Postdocwww.maalka.com

Enables cities, corporations, utilities and building owners to launch and manage successful sustainability initiatives.

Runway Postdocwww.nanit.com

Nanit is revolutionizing the way babies sleep with machine learning algorithms and advanced computer vision technology.

Startup Studiowww.phylosofy.com

A paper book on which any digital content can be viewed using our cross-platform mixed reality software.

Runway Postdoc

Helps patients with motor-related diseases, like Parkinson’s, Arthritis and Multiple Sclerosis.

Runway Postdocwww.peachylabs.com

PeachyLabs is building a computer vision system that can fully describe the food in an image, including ingredients, dish name, nutritional data, cuisine and flavor profile.

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This Year’s Studio & Postdoc SpinoutsStartup Studiowww.robotc.io

RoboTC is a universal brain which instantly gives any robot intelligence.

Runway Postdocwww.shade.io

Developing a groundbreaking UV radiation monitoring system for people suffering from lupus.

Startup Studio

A data platform for autism education.

Startup Studiowww.uruvideo.com

Uses computer vision to create a whole new (and entirely unobtrusive) ad spot inside your videos.

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This Year’s Alumni StartupsAlumniwww.bambify.com

Bambify empowers apparel brands and entrepreneurs to launch an idea from one platform.

Alumniwww.leavenworthclothing.com

Bringing a new option in shirts for men as we've made a shirt knit using silk, cashmere and cotton with a loose neck and fit.

Alumniwww.turtle.ai

A simple to use project management software that makes it easy to find and hire freelancers AND integrate them into existing teams and projects.

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Startup Culture

Since New York City issued the applied sciences and engineering challenge in 2010, Cornell Tech has been on the forefront envisioning and planning the future of graduate education. Over the last 4 years, since the selection of Cornell Tech and the Technion as the institutions to build a new applied sciences campus in New York City, Cornell Tech has taken measurable steps toward pushing the limits on a new educational pedagogies that a!racts world-class faculty, students, staff, industry leaders, and practitioners. Revolutionizing graduate education requires Cornell Tech to simultaneously execute on a wide range of opportunities including initiatives such as the creation of a pre-eminent urban campus on Roosevelt Island, thought leadership pertaining to how corporations look to universities for innovation, and creating burgeoning spinout culture on the campus.

Cornell Tech is on the forefront of reimagining an academic environment designed to support the formation and development of startups on campus. Today, our economy is placing greater value on individuals’ ability who can build so#ware and apply their skills in a way that result in measurable value. We are in a time when it’s be!er to be able to builds things vs. simply know things. Cornell Tech’s approach to teaching students and entrepreneurs how to build is creating a new career path that is propelling students, faculty, and PhDs into forming companies, seed funding, and acqui-hires immediately following their time at Cornell Tech. At Cornell Tech’s current pace of innovation, the campus is on its way to becoming the largest incubator in the world.Currently, there are two programs at Cornell Tech that are responsible for the majority of startups formed on the campus. Those programs are Runway Postdocs and Startup Studio.

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Startup Focused Programs

The Runway Startup Postdoc Program is part business school, part research institution, and part startup incubator. Based at the Jacobs Technion-Cornell Institute, Runway ushers recent PhDs in digital technology fields through a paradigm shi! — from an academic mindset to an entrepreneurial outlook.

Startup Postdocs arrive with ideas for unproven products and markets that require time and specialized guidance to develop. These startups demand more than a few months to launch. They need a bit of a “runway.” That’s why our program lasts 12–24 months and incorporates academic and business mentorship.

Runway provides an impressive package valued at $150,000 that includes a salary, research budget, housing allowance, space and more. In addition, the Startup Postdoc receives significant benefits and perks and corporate support valued at $320,000.

This class helps students develop their ability to imagine, recognize, develop, and improve startup ideas. Students invent and explore thousands of startup ideas, and help each other evaluate and improve those ideas. By the end of Startup Ideas, students self-organize into co-founding teams around specific startup ideas that they will execute on in Startup Studio the following semester.

Runway Postdoc Startup Ideas

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Startup Focused Programs

Students, develop their ideas, products, and pitches, learn to create and tell a compelling startup story, build and demo a prototype, and test their product with users. Some teams go on to cofound these startups a!er graduation.

Cornell Tech’s integrated curriculum continues to evolve and push the boundaries of academia’s role in startup creation and commercialization of new technologies. As an example, The Foundry at Cornell Tech, the campus’s internal product development team, actively builds innovative technology that is used in the classroom by students to bolster the creation of new ideas. Unicornucopia, the latest technology built by The Foundry for the classroom, has been responsible for the creation of over 1,000 ideas and inspirations that led to startups formed on campus through Startup Studio. A new version of the Unicornucopia is currently being used by students at Cornell Tech, and we expect over 3,000 new ideas to be created during the Fall 2016 semester. Beyond the classroom, The Foundry has worked with several spinouts on product development and design.

Startup Studio Continued growth

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Spinout Support Suite

The Spinout Clinic helps transition Cornell Tech founders out of the academic environment and into the startup community. During the clinic, founders gain access to ready-to-use resources that help founders navigate current spinout decisions. Each session consists of a round table discussion that dives deep into founders’ real-time concerns and decisions. The round table discussions are followed by forward progress sessions, where practitioners that have very specific experience are invited to work with the teams one-on-one to execute next steps that include legal entity formation, Startup Award application preparation, fundraising, media training, and more. Five of the seventeen 2015 spinouts found their lawyer at the Spinout Clinic and eight teams learned how to structure their seed rounds.

Spinout ClinicThe Spinout Open House brings together and empowers an enthusiastic community of angel investors to make early investments in the institution’s highest potential teams. This informal angel network is growing and prime to make pre-seed investments in high-potential student teams. In Nov. of 2015, we organized a group of 60+ investors to Cornell Tech’s co-working space in the New York Times building to support growing group of startup spinouts. Just two months a!er the first Spinout Open House, two of the participating teams have received investment commitments from angel investors who a"ended the event.

Spinout Open House

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Spinout Support Suite

Startup Awards supports post-graduate startup opportunities that are too early for seed funding and unable to be self-funded. At Cornell Tech, entrepreneurs are trained to view the world through an entrepreneurial lens and to exercise entrepreneurial behavior: forming teams and building products that address opportunities in the commercial world. However, it takes time for students to translate their entrepreneurial experiments into new commercial ventures, thus they are o!en too early to a"ract seed investments. This common scenario creates a “gap” between the post-academic environment and teams’ investment readiness. For teams that are not financially independent—which are most students—the cost and risk of building a startup during the gap period deters an entrepreneurial career and leaves potentially valuable opportunities unrealized. For this reason, Cornell Tech offers startup awards.

This award allows any Cornell Tech students or alum, regardless of economic status, to directly pursue an entrepreneurial career a!er graduation. In addition to the cash award, we offer free, dedicated Cornell Tech co-working space in the New York Times Building. Six of the seventeen spinout teams earned a Startup Award.

Startup Awards

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Just Ge!ing Started

We are in the earliest days of building a transformational institution. These early signs of spinout success have been produced during a period where only 100s of students and 100s faculty/staff have ventured out to explore the possibility of a university being intimately involved in startup idea generation, formation, and spinout. We are expecting 10x growth ahead of us, and that growth will have an extraordinary impact on Cornell Tech’s spinout activity and culture. We look forward to building Cornell Tech spinout capacity—a process that builds on key learnings year a#er year—and a!racting the very best entrepreneurs to drive innovation in the digital economy!

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Contact Us

If you are interested in learning more about Cornell Tech startup spinout activity or would like to get involved, then contact Aaron Holiday at ah643@cornell.edu.ah643@cornell.edu