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April 5, 2021 Startups, Innovation & Technology

COVID-19 disrupts Hartford’s efforts to become a startup magnet

PHOTO | CONTRIBUTED Startup founders participate in a strategy session during a pre-COVID Hartford InsurTech Hub accelerator program in downtown Hartford.

Disruption is a common theme in the tech industry.

And that’s precisely the impact COVID-19 has had on Hartford’s fledgling efforts to develop a startup ecosystem — particularly on accelerator programs that have brought dozens of early-stage companies to the city in recent years with hopes they will stay and grow here.

Michelle Cote

In fact, Startupbootcamp, the London-based company that was hired to run two Hartford accelerator programs focused on grooming insurance and healthcare firms, has essentially left the market, leading some to worry about what’s next for the region’s efforts to cultivate a vibrant startup scene.

But others aren’t ringing the alarm bells just yet, arguing that while COVID-19 may have limited opportunities to physically bring new startups to Hartford, there are plenty of ongoing efforts to make the city more attractive to innovative early-stage companies. They also say that accelerator programs, while important cogs in a startup ecosystem, aren’t necessarily the whole machine.

“I think we learned a lot of lessons through hosting [Startupbootcamp],” said Michelle Cote, director of Launch[H]artford, a nonprofit that works as a go-between for startups, government officials and corporations in the city. “I think our partner companies have become much more sophisticated in their ability to host innovation activity.”

Cote said Startupbootcamp served its purpose, and was a good way for Hartford to distinguish itself as a place where people are serious about creating an innovation economy. But she added the accelerator model isn’t the only way to accomplish this.

Cote said Launch[H]artford is currently working on a significant program to bolster the city’s entrepreneurial efforts that will be unveiled later this month.

She declined to provide further details.

Economic ‘engines’

Startup accelerators have been around for years, largely getting their start in tech havens like Silicon Valley and Boston. Each program can differ somewhat but they all essentially provide education, mentorship, financing and/or office space to early-stage companies, typically over the course of several months.

The goal for host cities is to get some of those startups to relocate there and eventually add jobs and economic activity.

Startupbootcamp’s arrival in Hartford was heralded as a major win for the city.

It first entered Connecticut in 2017 to run the state’s inaugural insurtech accelerator (Hartford InsurTech Hub), which lasted for three years until its final cohort finished amid the pandemic in May, 2020. It was also tapped to run a medical technology accelerator — in partnership with Hartford HealthCare, Trinity College and the UConn School of Business — that was announced in 2019 and ran for one session.

Dawn LeBlanc, managing director of the Hartford InsurTech Hub, said Startupbootcamp made a decision to largely put aside its U.S. efforts and focus on other countries where it operates, although it still plans to continue an all-virtual program — called Hartford InsurTech Hub 2.0 — that matches mature startups with insurers, including some based in Connecticut.

David Lehman

Shana Schlossberg, CEO and founder of downtown coworking and incubator space Upward, said Startupbootcamp’s exit from the two accelerators should serve as a warning that the burgeoning startup community that gained momentum in the three years leading up to the pandemic could fizzle without increased support and public funding.

“We all got slapped in the face by COVID, and now we kind of have to go back to 2017, actually invest more and give more to these [accelerators] so they can make up the lost time,” said Schlossberg, who also runs an accelerator called Upward Labs that focuses on grooming smart building and senior care technology. “How can we go backwards now? We need to continue promoting this city around the world.”

The state is focused on building up Hartford as an attractive place for entrepreneurs, said David Lehman, commissioner of the Department of Economic and Community Development (DECD).

Lehman praised accelerator programs for bringing startups to Hartford, and promoting the city as a desirable place to do business. The state has financially supported several of these programs in recent years, including about $7 million in funding from DECD and Connecticut Innovations — the state’s quasi-public venture capital arm — to Upward and Upward Labs, Lehman said.

One possible source of additional support could come from the federal government’s American Rescue Plan, which will bring billions of dollars in COVID-19 relief to Connecticut. Some of that money should go toward promoting startups, Lehman said. But that doesn’t necessarily mean direct funding to accelerators or coworking spaces.

“There’s not a magic bullet here other than sound policy and continuing to lean into the workforce and make it easy to start these businesses,” Lehman said. “Silicon Valley was happening before the era of WeWork and Upward Hartford, as was Cambridge, so I think it’s more than just the accelerator.”

The startup accelerators that launched in Hartford in recent years didn’t just depend on state funding. They also received corporate support.

Dawn LeBlanc

For example, Startupbootcamp’s InsurTech Hub received funding from Cigna, Travelers Cos. and The Hartford, while the Stanley + Te

chstars Accelerator, focused on advanced manufacturing companies, received backing from New Britain toolmaker Stanley Black + Decker.

LeBlanc said insurers didn’t renew funding for InsurTech Hub after a three-year contract ended last year. She said the program lost value, since a large part of what Startupbootcamp brought to the table was the ability to travel the world and recruit startups, which wasn’t possible during the pandemic.

Schlossberg said she thinks the state underestimates how important accelerators are to developing Hartford into a startup-friendly city. She refers to accelerator programs as the “engines” driving Hartford’s startup scene over the past few years.

State funding for accelerators has been premised on the idea that the money would get the programs up and running, and then success or failure would dictate whether they can continue on their own, Schlossberg said. The programs had been achieving what they set out to do, she added, but because of COVID-related setbacks, they require more funding to continue.

Shifting gears

Others running accelerator programs in Hartford agree that COVID has posed challenges. Some think they might shift the way they run accelerators to make them more effective in the future.

Hartford HealthCare in 2019 partnered with Trinity College and the UConn School of Business to establish the medical technology accelerator run by Startupbootcamp.

Dr. Barry Stein, Hartford HealthCare’s chief clinical innovation officer, said the health system is still working with startups that went through the medtech accelerator’s first and only cohort, including Lineus Medical, which is currently seeking Food and Drug Administration approval for a device that aims to reduce IV complications.

But the accelerator program has since evolved. Moving forward, instead of recruiting a specific number of companies to Hartford for a predetermined amount of time, HHC is looking to directly partner with startups trying to solve healthcare-related problems.

Dr. Barry Stein

For example, it recently partnered with tech firm Openwater, which is developing a medical-imaging product able to detect strokes. It also has an ongoing relationship with the Israel Innovation Authority and is working with two startups developed through that partnership.

“We are a traditional accelerator on steroids,” Stein said.

Paul Tyler is chief marketing officer at Hartford-based Nassau Financial Group, and runs the two-year-old Nassau Re/Imagine accelerator, which provides startups in the life insurance, annuity and reinsurance industries with free work space and legal, human resources and business-development services. Before the pandemic, he’d tell startups in the fintech and insurtech spaces they should come to Hartford to be in close proximity to large insurance and financial firms.

“We started our program saying, ‘come to Hartford, you can bump into an actuary in the coffee shop, you can ride the elevator up and meet all these people,’ ” Tyler said. “Well guess what? They’re not here [right now].”

For the rest of at least this year, Tyler said Nassau Re/Imagine will likely focus more on working with startups remotely and connecting them to companies in Hartford.

Stanley Black & Decker runs the Stanley+Techstars accelerator out of its downtown innovation center in Constitution Plaza. The pandemic forced the accelerator to host its 2020 cohort remotely, and companies were able to adjust to the new format, said Mark Maybury, Stanley’s chief technology officer who heads the accelerator program.

Maybury said Stanley+Techstars will keep bringing startups to Hartford, but he’s taking a hard look at shifting the accelerator to a hybrid model with a mix of in-person and remote elements.

“All physical is not nirvana, and all virtual is not nirvana,” Maybury said. “I think an appropriate mix of the two intentionally chosen is the optimum way to go.”

Shana Schlossberg

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