Fintech
Office of the Governor | Governor Murphy Announces Fintech Accelerator Proposal in Hoboken
NJ FAST is the fourth strategic innovation center in the state and will support research and development, innovation and entrepreneurship in the Fintech and Insuretech sectors
HOBOKEN, NJ (May 7, 2024) – Governor Phil Murphy announced today that the New Jersey Economic Development Authority (NJEDA) and Plug and playa Silicon Valley-based innovation platform and company known for connecting startups, corporations, venture capital firms, and government agencies, has launched an acceleration hub known as the Fintech Accelerator at Stevens Institute of Technology (NJ FAST). FAST is the first East Coast location for Plug and Play, which has partnerships around the world.
THE Strategic Innovation Center (SIC) will serve as a hub for financial technology (fintech) and insurance technology (insuretech) startups. Stevens Institute of Technology will serve as a founding academic partner and Financial Prudential will serve as a founding member of NJ FAST.
“As the fourth strategic innovation hub, NJ FAST positions New Jersey to remain at the forefront of innovation, research and development, particularly in the cutting-edge fintech and insuretech sectors,” said Governor Phil Murphy. “NJ FAST will enable new entrepreneurs to bring their world-class ideas to New Jersey, further growing our state’s inherently impressive talent pool, all while capitalizing on the resources and expertise of our partners at Stevens Institute of Technology. Our partnership with Plug and Play sends a clear message: when it comes to technology and innovation, the Garden State is the place to be.”
NJEDA and Plug and Play have signed a non-binding letter of intent to form a limited partnership known as NJ FAST. The two entities will oversee the NJ FAST accelerator program with the opportunity to make equity investments in select participating companies. The program will host two cohorts per year, with a minimum of 10 companies per cohort. Companies will be recruited globally to participate in the program, but at least 20 percent of the cohort will be New Jersey-based and there will be a strong focus on diversity, equity and inclusion. Equity investments of up to $1 million will be made in at least 15 percent of the participating companies.
Pending approval by the Board of Directors, NJEDA intends to invest up to $17.5 million in the fintech accelerator.
“Since taking office, Governor Murphy has prioritized growing New Jersey’s innovation economy, ensuring that tomorrow’s companies have access to world-class resources and support as entrepreneurs grow and scale their businesses,” said Tim Sullivan, CEO of NJEDA. “Supported by NJEDA’s Strategic Innovation Center program, NJFAST aims to make New Jersey a national leader in fintech and insuretech by supporting innovation, which will help scale up startups and drive the creation of new technologies that will in turn create jobs and support long-term sustainable economic growth across the state.”
Plug and Play was founded in the 1990s and achieved early success by investing in companies like PayPal and Dropbox. The company has more than 60 locations across five continents, with NJ FAST being the company’s first partnership on the East Coast. Plug and Play’s network is comprised of 50,000 startups, more than 500 leading companies, and hundreds of venture capital firms, universities, and government agencies. From 2020 to 2022, Plug and Play was the world’s most active startup accelerator, according to CB InformationPlug and Play invests in over 250 companies each year.
The company plans to commit at least 10 percent of its total capital commitment, up to $2.5 million, in funding for the Innovation Center and will seek funding and industry support from various corporate entities.
“We couldn’t be more excited to land in New Jersey and work with NJEDA, Stevens Institute and Prudential to grow our presence on the East Coast and implement our open innovation approach in the financial services and insurance industry to identify and accelerate the most promising startups in the space,” said Michael Olmstead, Chief Revenue Officer at Plug and Play.
Stevens Institute and Prudential will provide training and other educational, licensing and research opportunities for startup companies participating in NJ FAST and more. Stevens will also host events annually on its campus and provide a permanent team of student interns who will work to support participating companies.
Stevens Institute already has a strong presence in the fintech space. Its fintech-focused research center, the Center for Research Toward Advancing Financial Technologies, collaborates with academic and industry partners on innovative solutions such as decentralized finance, AI-enabled finance, quantum finance, and solutions to climate impacts on investments. The research center also works to protect financial data by building and testing fairer trading platforms and supporting improved market simulation and stress testing tools.
“NJFAST is an excellent example of a public-private partnership in higher education that has the potential to bring significant economic value to our state and serve as a national and global leader,” he said.assists Stevens Institute of Technology President Nariman Farvardin. “Stevens is pleased to leverage her deep and significant expertise in financial systems, technology and entrepreneurship, and our knowledge of emerging areas such as artificial intelligence, machine learning and quantum computing, for the benefit of all partners and the state.”
With renowned financial institutions such as Prudential, Barclay’s, Fiserv and JP Morgan already present in New Jersey, NJ FAST will build on the state’s long history as a leader in the financial sector. With a focus on financial technology, NJ FAST will support the growth of new types of companies and career opportunities, expanding New Jersey’s influence in the national finance and financial technology sectors.
“NJ FAST will create exciting new business ventures for entrepreneurs in Hudson County, New Jersey and the region. Investments like this are critical to creating jobs and expanding New Jersey’s innovation economy,” said Kathleen Coviello, NJEDA’s chief economic transformation officer. “NJ FAST will serve as a central hub for innovative fintech entrepreneurs, enabling the advancement of new cutting-edge developments.”
SICs are facilities that support research and development, innovation, and entrepreneurship through mentoring, networking opportunities, hands-on training, business support services, and educational opportunities. SICs can be accelerators, incubators, or research centers. Having a physical location where entrepreneurs can collaborate will help support diverse new innovators and drive long-term economic growth.
Last week, Governor Murphy attended the cutting of the ribbon at HAX’s flagship U.S. headquarters in Newark. HAX, also a SIC, will support 100 new companies over the next five years, generating at least 2,500 new jobs.