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As MassChallenge considers expansion, could New York be next?

Posted by Scott Kirsner  December 6, 2011 11:54 AM

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The founders of the MassChallenge start-up competition, which offers $1 million in prize money to promising companies, have spent the summer and fall engaging in conversations about expansion. While bringing the competition to a second city will require funding commitments from philanthropists and corporate sponsors — which haven't yet been nailed down — it sounds like New York tops the list, followed by London. Cities in Brazil and the Middle East are less likely candidates. And as the Boston-based program enters its third year in 2012, founder John Harthorne tells me that a second city wouldn't launch before late next year or 2013.

On New York, Harthorne says, "There's a lot of money, and a big media presence. We've been talking to billionaire types and major corporate entities." While there's no anchor funder yet for a Manhattan-based MassChallenge, Harthorne says there are several interested parties. (Among the benefactors who have supported MassChallenge in Boston are Sycamore Networks founder Desh Deshpande and Vertex Pharmaceuticals founder Josh Boger.)

Co-founder Akhil Nigam traveled to London in November to discuss the potential of a second MassChallenge program operating there. And when I caught up with Harthorne by phone yesterday, he was at Logan Airport on his way to Brazil, where he was participating in the state's "Innovation Economy Mission." "Brazil would be an interesting place for us," he said.

Though the Boston program received applications from 733 start-up teams this year (up from 446 in its inaugural year), there is the question of whether a second site for MassChallenge would dilute the quality of entrants. And also whether state agencies that have offered financial support to MassChallenge here would continue to feel that MassChallenge was doing enough to boost economic development in Massachusetts if it was simultaneously doing the same thing in New York. Harthorne acknowledges the political sensitivities, and says he has talked with city and state officials already. He believes that a New York program "could be complementary to both locations. Boston and New York both have a common enemy, which is California, and all of the hype that surrounds Silicon Valley."

Three things make the MassChallenge different from collegiate business plan competitions, or accelerator programs like Y Combinator and TechStars. First, MassChallenge is open to all sorts of start-ups, whether they're developing biotech drugs or shoes or gluten-free cereal. Second is size: they offer free office space and mentorship to more than 100 companies each year. And third, the prize pool of $1 million, doled out in $50,000 and $100,000 chunks to a chosen few companies, comes with no strings attached; MassChallenge doesn't take equity in the companies that win.

The program's 2011 winners are listed here.

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About Scott Kirsner

Scott Kirsner was part of the team that launched Boston.com in 1995, and has been writing a column for the Globe since 2000. His work has also appeared in Wired, Fast Company, The New York Times, BusinessWeek, Newsweek, and Variety. Scott is also the author of the books "Fans, Friends & Followers" and "Inventing the Movies," was the editor of "The Convergence Guide: Life Sciences in New England," and was a contributor to "The Good City: Writers Explore 21st Century Boston." Scott also helps organize several local events on entrepreneurship, including the Nantucket Conference and Future Forward. Here's some background on how Scott decides what to cover, and how to pitch him a story idea.

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