Southside Bethlehem KIZ Continues to Foster Innovation and Entrepreneurship
By Colin McEvoy on November 22, 2017
444 jobs created. $7.8 million in investment. Nearly $1.2 million in technology transfer grants awarded. 141 new products developed.
Those are just a few examples of the impact the Southside Bethlehem Keystone Innovation Zone (KIZ) has had since its founding 13 years ago, it was announced at the program’s annual update event on Nov. 21 at Lehigh University’s Iacocca Hall.
“Innovation and entrepreneurship are foundational traits of our city and will continue to lead us in this new economy,” said Bethlehem Mayor Robert Donchez. “It is through programs like the Southside Bethlehem KIZ that we are able to retain and attract bright minds, technology, and products in our city.”
A crowd of more than 200 people attended the event, which also highlighted three startup companies aided by the KIZ this year: Soltech Solutions, a manufacturer of state-of-the-art LED grow lights; UBMe, a free proximity-based networking app; and Freebowler, a manufacturer of portable machines for throwing cricket balls.
“The KIZ has been amazing, and it’s been a great honor to be a part of it,” said Val Arzunian, Founder and CEO of UBMe. “Thanks to the KIZ, I’ve really come to think of Bethlehem as my home now. This is where I want to be, where I’m going to hire people, and where I’m going to grow.”
KIZs are designated areas within Pennsylvania that foster entrepreneurial growth in coordination with the efforts of institutions of higher education. In Bethlehem’s case, the KIZ provides an incentive for graduating Lehigh University and Northampton Community College students with an idea for a startup company to locate in the city, rather than leaving the state for Silicon Valley or another technology hub.
“This is a zone that has continued to do amazing things,” said Sherri Collins, Deputy Secretary of Technology & Innovation at the Pennsylvania Department of Community and Economic Development. “It’s one of the only zones out of 29 in the state that continue to operate at this level. It has always been a poster child for the KIZ program in Harrisburg.”
Since its founding in 2005, the KIZ has led to $69 million in additional funding leveraged, 119 patents awarded, and more than 160 interns placed in companies, according to Asher Schiavone, Bethlehem economic development coordinator.
For every $1 invested by the KIZ, there were $8.88 in additional funding leveraged, $8.58 in increased revenue, and $5.63 in research and development expenditures, Schiavone said.
“It’s pretty amazing to think about all that investment going to companies just in Southside Bethlehem alone over the last 13 years, Schiavone said. “Those are definitely numbers we’re very proud of.”
A company is eligible for financial resources through the KIZ is they are located within the geographical boundaries of the zone, have been operational for less than eight years, and operate within state-approved industry clusters such as information technology, financial services, advanced materials, nanotechnology, opto/micro electronics, life sciences, and energy.
Financial resources provided by the KIZ provides include technology transfer grants up to $15,000 per project, student internship grants of up to $3,750 per intern, and KIZ tax credits up to $100,000 annually, and Technical Entrepreneurship Capstone Program Grants up to $5,000.
Arzunian said thanks in part to the KIZ’s support, UBMe will be presenting at the 2017 New England Venture Summit, where the company was chosen as a “Top Innovator.” Additionally, an intern that started with UBMe through the KIZ helped Arzunian establish a connection with a past advisor to Facebook CEO Mark Zuckerberg.
Paul Hodges, co-founder and CEO of SolTech Solutions, said the company has sold hundreds of units in the past year to almost every state and about 15 countries, with a 20% customer return rate.
“This last year has really allowed us to scale and I credit that to the KIZ,” Hodges said. “I’m very happy that Bethlehem is our home. It’s great stuff.”
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