High-tech sector gets big lift
Since its inception in 1999, Innovation Works has channeled $36 million in state money to Southwestern Pennsylvania startup companies.
But it is other people’s money that most excites Rich Lunak, the local economic development organization’s CEO.
Last year, the 109 companies in the Innovation Works portfolio attracted $122 million in outside investment from venture capital firms, corporations and private investors, Lunak announced Thursday at the organization’s annual meeting in Lawrenceville.
That record tally — up from $92 million in 2006 — further bolsters the region’s rising stature as a good bet for high-tech money, he said.
“While we certainly aspire to greater things, our region is starting to get recognized by outside investors and outside press as being an up-and-coming place for new technology,” Lunak said.
Ten businesses that have received seed funding from Innovation Works showcased their products and business plans at the meeting. Rather than the organization’s offices in the technology park near Hazelwood, the event was held at a former chocolate factory that now houses robot firms RedZone Robotics and Seegrid.
WhereverTV got $150,000 from Innovation Works this year for software development. The South Side company plans to start selling a $199 device in June that allows people to view any video signal from the Internet on television.
“Without the funding from Innovation Works, we wouldn’t be launching next month,” WhereverTV CEO Mark Cavicchia said.
The Coraopolis native said he got the idea in China, after his computer kept crashing while he tried to watch streaming video of a Steelers-Browns game.
Lunak knows what it’s like to start a high-tech company in Pittsburgh.
He was the third person on the payroll of Automated Healthcare, founded by Sean McDonald in 1987 to produce a system for filling prescriptions at a hospital pharmacy.
“My father said, ‘You left Westinghouse to do whatâ¢ Live in a two-bedroom apartment and build a robot?'” Lunak said. “I think there were visions that I was going to retire with my 50-year service watch.”
Automated Healthcare grew to more than 1,000 employees and was bought by pharmaceutical distributor McKesson Corp. in 1996 for $65 million. The division is still based in Cranberry.
Several of Lunak’s former colleagues from Automated Healthcare have found their way to other local tech companies, including former sales vice president Aldo Zini, now CEO of Aethon, a maker of hospital robots showcased at yesterday’s event..
Innovation Works received $6.9 million from the Pennsylvania Department of Community and Economic Development last year, according to its report. It invested $6.1 million in local companies.
The organization also provides help to new companies through its executive-in-residence program and other services.
“You walk in, you talk to them and right off the top of their head, they say, ‘Call X, Y and Z,'” said Craig Markovitz, CEO of Blue Belt Technologies in Oakland. “It’s like instant, awesome networking.”
The Oakland company got $300,000 from Innovation Works this year to help it get U.S. Food and Drug Administration approval for a computerized bone saw for surgical use.