NYC Invests $12M To Provide Free Fiber Build-Out To 240 Startups

The city of New York has just launched the ConnectNYC Fiber Challenge to help small NY-based companies get a free high speed fiber build-out in their offices. In order to win the prize, you have to submit an application to justify that you need very high speed connectivity — tech startups seem to have an edge in the challenge. In all, 240 companies will each receive a chunk of the $12 million investment over two years. The average cost of a build-out is approximately $50,000.

The build-out will begin very rapidly as $7 million will be distributed this year. Qualifying companies must be located in New York, and have fewer than 100 employees in total.

“My job is to make sure that companies that are relocating or starting in New York have everything they need,” Rachel Haot, Chief Digital Officer of the City of New York, told us after Shapeways’ factory opening on Thursday. Connectivity is one of the key elements to attracting startups to New York.

The three judging criteria will be the potential impact of fiber on the business (30%), the potential to improve broadband infrastructure in underserved areas (40%) and the potential for industry clustering (30%). Companies that are located in specific parts of the city, such as New York’s Industrial Business Zones, will have a better chance to win.

The city has partnered with Time Warner Cable and Cablevision. Winners will have to agree to sign a one-year contract with those ISPs. Other than that, there aren’t many downsides to participating in the challenge.

The involvement of officials in the tech ecosystem is one key differentiator of the New York scene. Other important parts need to be addressed but the city has those needs in mind. “The number one thing companies are asking for when they are relocating to New York is talent,” Haot said.