Biotechnology startup Big Magic Inc. is now the second business taking advantage of the state’s NJ Ignite program – a rent subsidy state economic incentive for companies eyeing a move into one of the state’s existing collaborative workspaces and incubators.
Big Magic recently made a move into VentureLink, a 108,000-square-foot incubator at the NJIT campus in Newark which hosts more than 60 additional technology and life science companies, according to a statement issued Thursday from the Economic Development Authority.
The EDA’s NJ Ignite program subsidizes part of the rent for start-up’s moving into incubators or collaborative workspaces for periods of generally two, four or six months. The state and VentureLink will split the costs of six months of rent for the workspace.
Collaborative workspaces and incubators are typically utilized by start-ups strapped for the cash needed to afford office or laboratory space, or certain kinds of complicated equipment. Startup employees often have the opportunity to network and collaborate with each other, given their close proximity.
“Young, growing companies like Big Magic thrive in the synergistic environments that collaborative workspaces offer,” EDA Chief Executive Officer Tim Sullivan said in a written statement.
“Startups that operate from collaborative workspaces are far more likely to succeed than companies going it alone,” Sullivan added. “Helping startups through programs like NJ Ignite is vital to the re-emergence of New Jersey as a leader in innovation.”
The state has a collection of other economic incentives – all run by the EDA – to help lure in startups.
The recently expanded Angel Investor Tax Credit program allows investors to acquire refundable tax break of up to 20 percent of their investments into emerging technology businesses.
Another incentive, the Technology Business Tax Certificate Transfer Program or Net Operating Loss Program, allows eligible companies to sell state net operating losses and unused R&D tax credits to unrelated profitable companies for cash, which can in turn be used to fund research or as working capital.
But, the state’s largest incentive programs – the Grow New Jersey corporate tax breaks and the Economic Redevelopment and Growth gap financing program for residential projects which awarded billions of dollars in incentives in 2013 – both expired on July 1.
Gov. Phil Murphy, a critic of Grow NJ and ERG, declined to sign legislation extending the program for seven months to buy time for the and legislative leaders to hash out a new set of incentives. The governor and Democratic legislative leaders have been embroiled in a political dispute over the fate of those incentives.d