UB ventures into funding, invests $250,000 in student-founded startup

The modern seatbelt, Google and the implantable pacemaker are disruptive innovations with origins on university campuses.

Could a self-driving boat be the next notable innovation with university roots? UB and Varia Consulting Group have put money on it.

The first-ever venture capital fund administered by UB has made its inaugural investment: $250,000 to Buffalo Automation, an artificial intelligence (AI) startup founded by former UB students and primarily focused on autonomous marine navigation. UB’s investment will be matched by Varia for a total investment of $500,000.

Managed by UB’s Office of Business and Entrepreneur Partnerships, the Buffalo Innovation Seed Fund is an early-stage, evergreen venture capital fund dedicated to funding and growing the next generation of outstanding businesses in Buffalo. The initial fund has been capitalized with $10 million from Gov. Andrew M. Cuomo’s Buffalo Billion initiative, as part of UB’s Innovation Hub.

“The UB Innovation Hub is helping support emerging partnerships and foster collaboration. This inaugural investment is an example of the university’s commitment to growing the tech economy and creating good-paying jobs paving the way for Buffalo and Western New York to build back better and succeed in the post-pandemic future,” says Lt. Gov. Kathy Hochul.

The idea for Buffalo Automation began in 2014, when Thiru Vikram was an engineering student at UB. After winning $300 in a student pitch competition, Vikram and his co-founders went on to win numerous contests, including the grand prize at UB’s Student Sandbox competition and first prize at the Henry A. Panasci Jr. Technology Entrepreneurship Competition.

UB faculty and staff have fostered Buffalo Automation’s growth through coaching and mentorship. The company is also a graduate of UB’s Incubator @ Baird, has benefitted from UB student interns and has hired several UB graduates.

“UB has been inspirational to us from the time we were exposed to various startup initiatives at the university. The mentorship and support we’ve received from faculty and staff have been instrumental in getting us to the key milestones we’ve achieved,” says Vikram.

Buffalo Automation’s flagship product, AutoMate, is a predictive boat-navigation system that guides large commercial ships. The system utilizes AI, neural networks and thermal imaging technologies to identify obstructions such as stationary objects, people or other boats and provide warnings to crews to safely navigate around them.

AutoMate has been implemented in multiple commercial ships operating in the Great Lakes. The $500,000 investment will accelerate Buffalo Automation’s growth, helping the company secure additional customers and continue product development.

“Our next key milestone is to automate lock entry. Locks are very difficult for humans to navigate and are the No. 1 place that vessels get damaged. Our goal is for AutoMate to navigate locks precisely, eliminating damage to both ships and public infrastructure,” says Vikram.

The AutoMate system is also available in a consumer version called Pegasus, for smaller recreational boats. The technology is designed to provide a fully autonomous boating experience when combined with future electrified transport, such as water taxis and ferries.

“Decarbonizing the boating industry is an important part of our ethos, and we’ve designed Pegasus to fit into that model,” Vikram explains.

Buffalo Automation has launched a new product line that will also be boosted by the Buffalo Innovation Seed Fund.

The product is an app called Mayday. Using the app, people can point their phones at their surroundings and Mayday will identify objects in view. While Buffalo Automation has already programmed the app to detect watercraft, Mayday can detect anything once trained to do so. According to Vikram, this technology could potentially be implemented in any circumstance that needs AI, opening up new market opportunities for the company.

“Mayday is a solution for non-programmers. Mayday allows entrepreneurs to utilize AI in their products without ever writing a single line of code,” he says.

“The investment will cement Buffalo Automation as a permanent fixture in the Buffalo startup scene.”

Rick Gardner, director of startup ventures at UB, says that the Office of Business and Entrepreneur Partnerships has been impressed with Buffalo Automation’s “intelligence, resourcefulness and grit. These attributes, combined with their innovative solution in a growing market, make Buffalo Automation an attractive investment for the seed fund."

Scott Friedman, Varia co-founder and managing director, adds: “Buffalo Automation’s combination of AI, machine learning and proprietary algorithms is unique around the world. We have enjoyed working with Vikram and his team, and helping them grow one of Buffalo’s great early-stage companies.

“We also are delighted to partner with UB in supporting Buffalo Automation,” Friedman says. “With its many talented faculty and students, we have long viewed the university as at the epicenter of innovation in Western New York and expect the new Buffalo Innovation Seed Fund to further enhance and define its leadership role — not only locally but in the worldwide innovation economy.”

The mission of the Buffalo Innovation Seed Fund is to support Western New York-based, early-stage companies. The fund aims to help life-changing technologies make it out of the lab, into the marketplace and create new jobs for the region.

Monetary returns to the fund will allow UB to continue investing in emerging innovative startup companies.

“We designed the Buffalo Innovation Seed Fund to be cyclical, and our investment in Buffalo Automation is just the beginning,” says Christina Orsi, UB associate vice president for economic development. “By providing students, faculty, staff and researchers with the support they need to take a kernel of an idea and turn it into a product or service that benefits society, we are catalyzing the next generation of great startups right here in Buffalo.”