When Buffalo’s first unicorn went public in 2021, it marked a historic occasion for the local startup community. Among its potential impacts: An expected tens of millions of dollars for 43North.
The largely state-funded accelerator and incubator established the 43North Foundation, aimed at supporting the Buffalo-area entrepreneurial ecosystem, to administer the proceedings from ACV Auction’s initial public offering.
To date, those involved with the 43North organization and its foundation have declined to disclose the exact amount of funding the foundation has and how much it made from ACV's IPO.
But public documents filed with the Internal Revenue Service reveal the payoff the foundation received and give a peek into its potential economic resources today.
ACV, an online marketplace business for automotive dealers, is the first software startup founded in Buffalo to have achieved unicorn status, meaning it was valued at a billion dollars or more by the venture capital firms investing in it.
It was the $1 million grand prize winner of 43North’s 2015 pitch contest. As part of the terms, the organization got a 5% equity stake in the then-private startup. The company has since grown to a company with over 600 local employees and, in March 2021, became a publicly traded company on the NASDAQ.
That translated to a windfall of $40.64 million for the 43North Foundation, tax filings for the fiscal year ending December 2021 show.
In fiscal 2021, the foundation had total assets of $67.4 million, total expenses of $63,777 and total revenue of $56.48 million, according to the filings.
Coming soon: Business First’s analysis of the 43North filings is part of a larger cover story, publishing Sept. 1, evaluating 43North’s portfolio companies’ success and the economic engine’s overall regional impact. Sign up for our newsletters to make sure you don't miss it.
The foundation's mission is to "infuse our region with opportunities by investing in organizations, ideas and innovation — and in making Buffalo the best it can be." It funds that mission with the proceeds from the exits of 43North's portfolio companies, including money from businesses going public and getting acquired or merged.
It was one of the local investors that supported Bitwise Industries coming to Buffalo to train tech workers in underserved communities. (The Fresno, California-based company furloughed its entire workforce, including its Buffalo team, suddenly in late May.)
Bill Maggio, who chairs the 43North Foundation board and is past chairman of 43North, said that as the organization’s 2022 and 2023 tax filings become available, people will see the foundation’s assets growing.
He also pointed out that everyone who serves on the foundation are volunteers and that proceeds from ACV’s IPO aren’t the organization’s only assets.
“Our intention is to make this the most impactful foundation around supporting the entrepreneurial ecosystem in Buffalo, especially startup entrepreneurship,” said Maggio. “That’s our goal, and I think we’re well on our way to do that.”
