These 'smart cities' startups wanna move to Brooklyn - Technical.ly Brooklyn

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Sep. 15, 2016 12:45 pm

These ‘smart cities’ startups wanna move to Brooklyn

Meet the finalists for NYU Tandon's Urban Future Competition. Coming from as far as the United Kingdom, they're vying for $25,000 and a space at the Urban Future Lab incubator.

Amanda Weeks of Industrial/Organic makes her pitch.

(Courtesy photo)

Brooklyn is flexing its “smart city” steez.

Programs in the borough now offer resources to companies addressing how to improve cities, including Greenpoint’s Urban-X and the Urban Tech Hub at the Navy Yard’s New Lab. NYU Tandon’s city- and state-backed Urban Future Lab is the elder statesman of this bunch, having incubated 35 companies since launching in 2009.

Now, as part of the Urban Future Lab’s Urban Future Competition, seven startups from across the country (and two from the United Kingdom) are vying for cash and a place at the Urban Future Lab incubator at the MetroTech Center. The startups pitched on Monday. At least one company that pitched, London-based Highview Power Storage, plans to open a Brooklyn office whether it wins the competition or not.

The fact that companies from as far as San Francisco and London want to move to to Brooklyn to incubate their business points to the borough’s growing strength in the smart city sector and the legacy of the Urban Future lab (and yes, the prospect of winning $25,000 is also alluring). There’s been some skepticism about cleantech in particular in the past — we’re reminded of how Urban-X managing director Micah Kotch said that “some of the business models are still in flux” — so it makes sense for startups to find somewhere where’s there’s critical mass.

Urban Future Lab will announce two winners, which will each receive $25,000 and a spot at the incubator, at the REV Future conference on Sept. 27.

Seven finalists presented in two categories: Smart Grid, for companies focused on the energy sector, and Smart Cities, for companies addressing other urban challenges.

The Smart Cities finalists

  • Industrial/Organic, which has been popping up on our radar a lot these days, makes a compact processor for food waste. Rather than using anaerobic digestion to process waste, as standard, the company’s processor uses lactic acid fermentation, the same process involved in making kimchi and sauerkraut. One key benefit: it reduces odors. (There are apartments in the same building as Industrial/Organic’s facility in Red Hook.) The company makes money from restaurants by processing their food waste, and it then sells the resulting fertilizer to farms. That’s especially a big win for restaurants focused on the farm-to-table trend, CEO Amanda Prinzo Weeks said: “They can say that we’re closing the loop.”
  • Fentrend makes a platform for architecture and construction firms to compare the price and environmental benefits of doors and windows. The company, based at Coworkrs in Gowanus, also works with door and window suppliers, from whom it receives its data, to guide them through the bidding process on construction projects and from whom it takes a commission, whose amount the company declined to specify. Fentrend allows contractors to get pricing information in minutes, rather than waiting one to three weeks for a quote, and easily compare options. Few architecture firms make comparative bids, said CEO Andy Huh, but of those that do, “right now, [they’re] using Excel.”
  • CTY, based in St. Louis, has developed a sensor platform, called Numina, which can readily detect people and objects such as cars, down to the specific make and model. Numina’s primary application is detecting traffic patterns. Unlike similar technology, it does not record video, which is a plus in the privacy column. CTY is currently working with the city of Jacksonville, Fla., which CEO Tara Pham said has the highest fatality rate from car accidents in the U.S., to determine which areas are most prone to traffic-related accidents. The sensors have other applications, too: CTY is also working with the Brooklyn Navy Yard to automate alerts for trash pickup. “We believe that smart cities are responsive cities,” Pham said.

The judges for the Smart Cities category were Sukanya Paciorek, the head of asset management for the Brooklyn Navy Yard Development CorporationDavid Gilford, the senior director of client strategy at Manhattan-based Intersection, one of the companies behind LinkNYC; and Lila Preston, a partner at Generation Investment Management, the London investment firm co-founded by Al Gore.

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Judges David Gilford and Lila Preston deliberate.

Judges David Gilford and Lila Preston deliberate. (Courtesy photo)

The Smart Grid finalists:

  • OhmConnect, based in San Francisco, enables its customers to save on energy costs by alerting them of energy spikes and prompting them to reduce their energy use accordingly. The company subsidizes the cost of smart meters for its customers but makes money by selling the energy its customers save back into the market. One surprise the company found, director of partnerships Grace Park-Bradbury noted: most of its customers aren’t eco-conscious, they just want to save cash. “Most of us are here for the green, so that was a course correction for us,” she said.
  • Tagup monitors the status of industrial equipment through a connected hardware-software platform. The company, which is located in Somerville, Mass.-based Greentown Labs, a sister incubator to Urban Future Lab, is focusing on power transformers. According to CEO Jon Garrity, who previously worked at GE, Tagup has an advantage over its legacy competitors because it specializes in providing detailed analytics and a friendly user interface, neither of which are strengths of large, hardware-focused companies. “They will tell you they have expertise in software, but they don’t,” he said.
  • Highview Power Storage develops plants that use liquid air for large-scale energy storage. The plant captures air, cleans it then cools it to -194℃ to turn the air into liquid. The liquid air is stored in a cryogenic tank until it’s ready for use. Then it’s heated back into gas and exported to the energy grid. All of that sounds pretty fancy, but the London-based company uses off-the-shelf components for its system, business development manager David Kaye said: “It’s a quite mature technology.” Highview’s clients include the U.S. Navy, and it has partnerships with GE and British waste management company Viridor.
  • SEaB Energy, like Industrial/Organic, makes a compact waste processor, but its products are specifically designed to generate electricity, hence lowering both waste hauling and energy costs for its customers. The processors accept both food waste and liquid sewage (ew, we know). Although the units are pricey, at $400,000, CEO Sandra Sassow made the case for their cost benefit. “The system pays for itself in three years,” she said. Sasson said the company, which is based in the University of Southampton Science Park in the U.K., earned $1 million in revenue last year and is projected to take in $3.29 million this year — and turn a profit, which drew applause from the room.

The judges for the Smart Grid category were Lou Schick, a founding partner of Manhattan-based NewWorld Capital GroupMargarett Jolly, the director of research and development at ConEdison; Kotch, the managing director of Urban-X; and Jun Shimada, the founder and CEO of Manhattan-based ThinkEco, which was incubated at Urban Future Lab.

David Kaye of Highview Energy Storage presents his pitch.

David Kaye of Highview Energy Storage presents his pitch. (Courtesy photo)

What’s Next for Urban Innovation in Brooklyn

With this competition, the Urban Future Lab is seeking to freshen up the mix of companies in its incubator, managing director Pat Sapinsley told Technical.ly. Most companies stay in the incubator an average of two years, and a few members have begun to outgrow the space, she said. The finalists for the competition were selected using the same criteria as the incubator’s normal application process, so it’s possible that they all could end up joining the incubator. If they do, it would be a new way to draw out-of-town companies to the area and build up the smart city scene.

“We’re looking for new companies to fill the space,” she said. (If you’re interested, apply here. Rent begins at $450/month. The incubator doesn’t take equity.)

The recent surge in “smart city” programming in Brooklyn was evident at the event. Two of the finalists, Industrial/Organic and CTY, participated in the first cohort of Urban-X. (No conflict of interest: Kotch wasn’t involved in judging either of those companies.) Highview’s project manager, Richard Riley, told Technical.ly the company plans to open an outpost in Brooklyn, which he will head, regardless of its result in the competition.

The increased activity has been heartening to see, said Urban Future Lab program manager Jiro Otsuka, but it’s also been a little confusing to companies trying to figure out where to apply. Urban Future Lab, he said, is for companies that already have customers and revenue, so it may serve as a stepping stone for startups that have already gone through accelerators. But it’s not primarily focused on hardware companies, as Urban-X and Urban Tech Hub are. For instance, one of the incubator’s companies, United Wind, provides financing for wind turbines.

“They’re basically the SolarCity of wind,” Otsuka said, referring to the solar-panel company backed by Elon Musk.

One area where Otsuka anticipates greater interest is cybersecurity for the energy grid. The internet of things, particularly as it relates to the energy sector, has a dark underbelly: as more devices get connected to regulate energy use, hackers have more opportunities to wreak havoc. Utility companies have already started to approach the incubator about the topic, and Urban Future Lab may actively seek pitches addressing the issue in the future, Otsuka said. The Urban Future Competition was the lab’s first attempt at soliciting applications by offering prizes, but according to Otsuka, it’s looking to be a promising approach.

“These companies face a Valley of Death challenge, and we can provide an upfront incentive for them to keep going,” he said.

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