Recruitment gets underway this month for the first five early-stage technology companies to be part of a new initiative to grow the next generation of Huntsville defense businesses.
Cummings Research Park last month announced it’s launching a DefenseTech Accelerator, partnering with the Huntsville/Madison County Chamber and Treble One, a Dayton, Ohio-based aerospace consulting firm. The program is designed for companies with innovative products that can be grown and scaled in the defense and commercial markets.
“The idea is that by the time they graduate from this accelerator in 12 weeks, they have a fully marketable product that then can be sold to either the government or a prime contractor or an OEM, or they’ve got the ability to go after additional private capital at that point,” Erin Koshut, the park’s executive director, said.
At the end of the 12 weeks, “there will be a pitch competition to potential customers. We have the ability through this accelerator to impact their revenue.”
The program will use the Innovate Alabama tax credit program, a statewide initiative for local companies and individuals with significant tax liability to allocate 50% of their taxes to stay local. State tax liabilities that can be used for the program are the Alabama income tax, state insurance premium tax, state public utility license tax and the state portion of the financial institution excise tax.
So far, Synovus Bank, SimTech and Regions Bank are involved in the effort, and additional tax credit donors are sought for the effort.
“For this first year, we’ll do either one or two cohorts – we’re working on that right now – and they’ll have five companies each,” Koshut said. “The goal is that we launch that first cohort in the November time frame.”
Firms will be recruited locally and in Alabama as well as out of state to locate in Huntsville. “To fully take advantage of our ecosystem in Huntsville, you have to be here, and you have to be engaged,” Koshut said.
Since the announcement rollout, Koshut and Chris Wimmer, the vice president of business development at Treble One, have had companies reach out to them, expressing an interest to participate. Businesses can participate without paying any fees or relinquishing equity.
“This kind of development – having it in Huntsville, having it right outside Redstone Arsenal – I think will help identify potential technology integrations and technology products that support what the missions are of many of those 72 different agencies that are on the Arsenal,” Koshut said. “We hope that we’ll get some of those different agencies involved in the DefenseTech Accelerator and help these companies understand the missions of some of those agencies and what they’re looking for in the future and how this community and this accelerator program can support them.”
“Our country’s adversaries are developing major weapons systems nine years faster than the United States,” Wimmer said in a release announcing the program. “These adversaries are appropriating intellectual property and rapidly integrating these capabilities into their military forces, which could potentially lead to a future conflict where the U.S. might find itself at a significant disadvantage.
“It’s imperative that government, investment communities, startups, and primes unite to accelerate the defense ecosystem.”
There are accelerators in Huntsville that focus on business-to-business and consumer-focused entrepreneurial ventures, Koshut said, and “we felt like what we were really missing was an opportunity to grow the next generation of those defense contractors, whether it be to grow them into small businesses” or large defense contractors.
After researching and visiting some models across the country and connecting with Treble One, “ultimately, we decided to go after an accelerator program specifically for defense” and apply to Innovate Alabama to use their tax credit program to fund it.
A dedicated staff will manage the accelerator and the cohort process from space in Cummings Research Park East.
“The idea is that this is the first of what will become a multi-year program that will grow and grow the number of companies participating,” Koshut said. “I’m really excited to get it started, really excited to see the kinds of companies and products that we can have here in our community that can support the warfighter and the mission of these DOD agencies to keep our country safe.”
