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May 9, 2012

 

DiNapoli: State Pension Fund Invests in New York City's Technology Sector

In-State Program Provides Capital for New York Businesses To Grow and Create Jobs While Making Money for Pension Fund

New York State Comptroller Thomas P. DiNapoli today toured two New York City tech businesses, Truveris and Movable Ink, which received funding through the New York State Common Retirement Fund's (Fund) In-State Private Equity Program. The Fund has invested nearly $250 million in New York City companies through the program.

"Even in these challenging economic times, the entrepreneurial spirit is thriving in New York," DiNapoli said. "The In-State Private Equity Program helps established and start-up companies based in New York obtain the capital they need to grow their businesses and create jobs. The state pension fund is contributing to the economic strength of New York, while earning significant investment returns. Truveris and Movable Ink are technical innovators building the companies of the future and are part of what is making New York City one of the world's leading technology hubs."

The In-State Private Equity Program, which was founded in 2000 and made its first investment in 2001, partners with private equity managers who seek to invest in New York state companies that require capital for growth or to refinance ownership. The program provides investment returns consistent with the risk of private equity while also expanding the availability of capital for New York businesses.

Highlights of the In-State Private Equity Program (as of March 2012) include:

  • Of the nearly $1 billion committed to the program since 2001, $608 million has been invested in 218 companies, 139 of which are located in New York City. The program currently has significant additional capital available for investment in New York-based companies.
  • The program has returned $322 million to the Fund on $206 million invested in 75 exited companies.
  • DiNapoli has committed $534 million to the program since he took office in 2007.
  • More than 3,000 employees have been added at companies in which the program has invested.
  • New York State companies who have received investment through the program have raised nearly $4 billion in additional capital.

Since December 2010, the Fund has invested $1.7 million in Truveris with Tribeca Venture Partners. Truveris was founded in 2009 with six employees and now boasts 25 full-time staff. The SoHo based company makes software to drive efficiency and cost containment in the prescriptions claims process. Truveris helps payers of pharmacy benefits negotiate agreements with prescription benefit managers (PBMs), validate claim payment accuracy, ensure regulatory compliance and manage pharmacy spend.

"The U.S. spends more than $300 billion on prescription drugs per year with almost all of it going to PBMs virtually unchecked," Truveris Chief Executive Officer Bryan D. Birch said. "Truveris operates a unique software-as-a-service (SaaS) enabled pharmacy claim pricing engine to accurately price prescriptions and check for errors before the client pays its invoice. The funding we've received from our partner at the Common Retirement Fund has helped us expand our product offering and hire additional staff members in New York City to meet our current and future client expectations."

"The Common Retirement Fund's support has been instrumental in enabling us to fund the next generation of leading technology companies here in New York State," Tribeca Venture Partners Managing Partner Brian Hirsch said. "Truveris is a terrific example of the tremendous amount of tech innovation now happening here in New York. We believe historians will one day look back at this era as a renaissance period for tech innovation with New York at the forefront."

In November 2011, the Fund was one of the investors in Movable Ink's $1.3 million seed funding round led by Contour Venture Partners. Movable Ink was founded in 2010 by Vivek Sharma and Michael Nutt and has grown to eight employees in two years. With the Flatiron-based company's technology, emails become containers for live content that can personalize to current time, recipient's location, device, social context and business rules.

"Movable Ink helps some of the country's biggest brands, such as Verizon Wireless, Electronic Arts and DirecTV, increase customer engagement by powering live and streaming content within email," said Movable Ink Chief Executive Officer Vivek Sharma. "The support from the New York State Common Retirement Fund allows us to take email to the next generation. Without the NYC tech eco-system, Movable Ink would not have seen this level of growth."

"We are excited to be working with the New York State Common Retirement Fund as an investor in Contour, through which they are helping to grow the New York early stage technology ecosystem by investing in great entrepreneurs like Vivek and Michael at Movable Ink," Contour Venture Partners Co-Founder and Co-Managing Partner Matt Gorin said.

The New York City metropolitan area had the largest concentration of high-tech employment in the nation, with 317,000 jobs, according to the TechAmerica Foundation's most recent study of the high-tech industry in American cities. These positions cover a broad range of technology jobs in areas such as computer services and equipment, software publishing, internet services, telecommunications, electronics design and manufacturing, optics, medical equipment and biotech research and development.

In 2011, 60 percent of the venture capital investments in the New York metro area were made in the media and entertainment, software and IT services industries. New York state ranked third in the nation, behind California and Massachusetts, for venture capital funding.

DiNapoli will be touring several other investments made through the Fund's In-State Program in the coming weeks, with stops in Albany, Long Island and Rochester. For more information on the program or company eligibility, visit: www.osc.state.ny.us/pension/instate/


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