With a new state budget set to be revealed on December 17, Virginia Governor Terry McAuliffe took the stage podium on Tuesday at the Mach37 cybersecurity accelerator in Herndon, Va., to reiterate a focus on "building the new Virginia economy."
McAuliffe spoke to a small, select group of startup founders, defense contractors, state legislatures, journalists and venture capital investors from the state funded Center for Innovative Technology (CIT) to announce Mach37's first public-private partnership. The partnership will see General Dynamic (GD) become a "platinum sponsor," which will allow the defense technology giant to access the accelerator's member companies for licensing deals, to consider an acquisition and to help in the software development process.
The speech comes at a time when McAuliffe is seeking support from the Virginia General Assembly to establish a new budget that includes, among other things, increased education spending focused on cybersecurity training at state community colleges.
The aforementioned college program would be the first of its kind, McAuliffe said, as it will offer a cybersecurity degree to applicable students at no monetary fee but instead in return for 2 years of state service.
A McAuliffe spokeswoman later said that Virginia faces roughly 150,000 cyber attacks per day. It's unclear what the spokeswoman defined as an "attack" and who exactly was being "targeted." McAuliffe told the crowded room that Virginia currently boasts about 450 "cyber companies," second only to Silicon Valley, but continues to struggle when it comes to providing a workforce pipeline for them.
"What concerns me is that we have 18,000 jobs in the cyber space in Virginia, today. As Governor, I can tell you we better fix it or these companies will go elsewhere. 18,000 jobs and the average starting pay for them is $88,000. This is a big deal for us folks. We’re good at bring in business, now we have to ready that workforce," he said.
McAuliffe, a longtime proponent of the larger tech sector, said that he believes the commonwealth's future as an economic powerhouse will be predicated on whether it can diverse business growth and become progressively less reliant on Federal defense spending. One of the most important catalysts for longterm economic growth in Virginia, McAuliffe said, will come from the burgeoning cybersecurity sector.
"Two of my children had their data taken. It’s happening everyday"
"The federal government is going to spend billion of dollars on cyber for many years to come. And the private sector is going to spend billions of dollars on cyber. We all know it. We saw that the federal government has been hacked—OPM," McAuliffe said,"in fact, my wife received a letter the other day. We saw Anthem here getting hacked and they had information on all our state employees. Two of my children had their data taken. It’s happening everyday.”
Virginia, home to the Pentagon, several key military bases and a myriad of small-to-medium defense contractors, is the largest recipient of Department of Defense spending. When widespread defense cuts were applied to the federal budget, most notably and recently in 2012 and 2013, Virginia's economy suffered. McAuliffe appears determined to avoid that outcome again.
"We’re still going to get it [defense money via the national budget] obviously, but I think everyone is realizing we need to turbo charge the Virginia economy with a new diversification," he added.
"We need to turbo charge the Virginia economy"
In an interview with DC Inno, the Governor said that he expects the General Dynamics deal with Mach37 to further produce private interest across the space in the accelerator; effectively bringing more cash and resources to grow Mach37 as an organization capable of both developing security companies and talent. For reference, Mach37 has produced/graduated 29 startups since being founded in 2013.
McAuliffe also said that he personally plans to open his renowned rolodex to attract more sponsorships into Mach37. He, however, declined to comment on who will be contacted.
McAuliffe and Mach37 partner Rick Gordon said that the plan is for Mach37 to one day become an entirely self-sufficient operation that is independent of state funding.
Gordon declined to comment on the amount that General Dynamic had invested in Mach37, but added that it is an "extremely significant investment ... probably larger than you would expect."
