Tucked into the package of government enticements that helped land GE’s corporate headquarters in Boston was this little nugget: $5 million for an “innovation center” to help startups and academic researchers work with the industrial behemoth.
It’s not yet clear exactly what form that project will take or which technologies it might focus on. GE didn’t immediately return a message seeking more information about the innovation center, and Mayor Marty Walsh and Governor Charlie Baker declined to discuss additional details Wednesday.
But GE, which referred to the site as a “Digital Foundry,” made it clear that the Boston area’s historic strength in R&D was a major key in its decision to relocate to the city.
“Massachusetts spends more on research & development than any other region in the world, and Boston attracts a diverse, technologically fluent workforce focused on solving challenges for the world,” CEO Jeff Immelt said in his statement confirming the headquarters move.
That was welcome news to some in the region’s startup sector, which has long coveted a corporate household name to serve as a pillar for the region’s technology ecosystem.
Dave Barrett, a managing partner with Boston venture firm Polaris Partners, said the Boston area’s strengths in biotech, health IT, robotics, and other infrastructure innovations matched up well with GE’s corporate profile.
Having a company of GE’s size nearby also couldn’t hurt for startups and investors seeking big customers, spinout companies, or potential acquirers, industry observers said.
“If you’re talking about a company that’s a $150 billion business, it definitely is an admirable league to be in,” said Jody Rose, director of the New England Venture Capital Association. “It increases our access to capital. And not just capital, really — it’s more about innovation and being able to tap into their resources to seed that.”
Baker also touted the “tremendous ripple effects” that GE’s arrival could have on the local tech and research sectors in a Thursday morning interview with WBUR.
“A lot of the folks that play in the tech space are going to find a partner who’s going to be interested in investing in them and what they’re up to, and that’s going to be good for us,” he said.
Landing a major company with roots in new technologies also is a huge boost to the region’s tech credentials, said Allan Telio, a vice president of high-tech training program Startup Institute — particularly while longtime local tech leader EMC is in the middle of selling itself to Dell in a $67 billion buyout.
“For a long time, the narrative that has come out about Boston is `everybody leaves.’ We always lose to California. You take a look at Facebook or Dropbox or Reddit, or whatever company that has done well that got started here, but left,” he said. “This really does change the narrative.”
GE isn’t the first tech company to plant an innovation-focused initiative in the Boston area. In May, Royal Philips announced plans to consolidate its North American research operations into a 250-person center in Cambridge, near researchers at Harvard and MIT.
Location is another key factor in GE’s drive to connect with a new wave of technologies and entrepreneurs, Barrett said. A generation ago, a major corporate headquarters might have been planned in the suburbs rather than the urban Seaport District targeted by GE.
But changing demographics have driven innovative companies and their investors back into the city. Barrett’s firm is a perfect example: after years in Waltham, Polaris Partners relocated about a year ago to the same neighborhood that will soon welcome GE.
“Millennials want a great work experience, not just great employment,” Barrett said. “That’s why so many technology startups want to be down here or in Kendall, because there’s just so many like-minded innovators around them.”
Updated 11:25 a.m. with additional Baker comment, fixed typo in second paragraph.