Gov. Asa Hutchinson told attendees gathered at the ICBA ThinkTech Accelerator’s Demo Day on Wednesday (March 27) that he believes Arkansas can become a global “technology center” where companies can grow and make millions of dollars and then invest back into the state’s economy.
“My goal as governor is to bring education to bear in technology, in computer science and in all the fields that are needed, and then to lead that effort to make sure they have the job opportunities since we are going to be a technology center,” Hutchinson told a crowd of about 200 people at the Arkansas Regional Innovation Hub in North Little Rock.
Hutchinson made his comments at the end of the first-of-its-kind, startup accelerator program, hosted by the Little Rock Venture Center. The local entrepreneurial service organization first joined with ICBA, or the Independent Community Bankers of America, in October to develop the first fintech incubator program to exclusively focus on aiding early-stage firms working on new innovations and hi-tech products for smaller community banks.
In January, the Venture Center selected finalists of 10 startup firms from across the globe to participate in the 12-week program. According to organizers, the program received 190 applications from early-stage financial technology companies across the U.S. and 39 other countries from as close as Fayetteville and as far away as New York City and Brisbane, Australia.
All 10 cohorts received an initial investment of $75,000 to participate in a 12-week residence and mentoring process for companies looking to partner with community banks. Last week, the eight companies that graduated from the first class held a live demonstration to an audience of more than 3,000 community bankers at an “ICBA Live” event in Nashville, Tenn. on March 18.
At Wednesday’s event, the eight companies gave a final “pitch” presentation at the Innovation Hub, where the audience included local community banking and business leaders, potential investors and a host of entrepreneurs from the city’s emerging startup community.
As is his custom, Hutchinson shared anecdotes from his job as the state’s chief executive by touting the much-publicized computer coding initiative at the center of his administration’s economic development and education plans. He told the festive crowd he was visited this week at the Governor’s office by more than 30 six graders from an elementary school in El Dorado.
“They came up to meet with me because they were all coders,” Hutchinson said proudly. “I couldn’t believe it, so I said, ‘What made you get into coding?’ and they were articulating answers, ‘well it’s robotics; it’s being able to tell a computer what to do, or it’s games.’ They are interested in this and they are going on.”
The state’s 46th governor also shared that he and state economic development officials traveled to Northwest Arkansas Wednesday for a groundbreaking to announce a new $46 million building along Interstate 49. When completed in early 2021, the three-story, 148,000-square-foot building will be the new Northwest Arkansas headquarters of Transplace, a third-party transportation management and logistics technology firm based in Frisco, Texas.
Today, the J.B. Hunt-led Transplace employs about 600 workers in nearly 80,000 square feet of office space in Lowell. The move to Rogers is expected to increase the number of workers to between 1,100 and 1,200, with an estimated $60 million in payroll, officials said.
“They call it the transportation logistics hub of the global marketplace,” said Hutchinson. “And so that’s a technology investment that’s being made, and then I come here and as governor I am impressed with this list of (eight) companies.”
Hutchinson also touted his technology bona fides by noting he will speak at the 2019 Blockchain for Business Conference at the University of Arkansas in Fayetteville, where academic and business leaders will discuss the emerging technology that involves blocks of digital data behind the development of cryptocurrencies such as bitcoins.
“Don’t quiz me on it, but I know how important it is,” Hutchinson said as the crowd roared with laughter.
The popular Republican governor closed his comments by saying that the Arkansas Economic Development Commission chose to help fund the ICBA Fintech program and other similar accelerator projects across the state in hopes of bringing more tech-related jobs and investments to Arkansas.
As noted, Hutchinson was behind three key bills enacted in the 2017 session, sponsored by former State Sen. David Sanders, R-Little Rock, that help startups and other technology ventures reach their potential. Acts 166 and 167 of 2017 overhauled the Arkansas Acceleration Fund created by the legislature in 2011 to help bring high-tech jobs to the state.
Act 165 of 2017 created the “Arkansas Business and Technology Accelerator Act.” Under this proposal, AEDC’s division of Science and Technology will create a state-supported startup immersion program that will help local companies and entrepreneurs quickly commercialize their business ideas and concepts.
“What more can we do?” Hutchinson asked rhetorically, adding, “We want to be that hub of excellence for technology companies that see Arkansas on the map as investing and leading the way in technology growth in our society.”
Earlier in the evening event, Venture Center Executive Director Wayne Miller said the cohort companies that made presentations Wednesday night will move forward and pursue deals with companies and small banks exploring next-generation lending, artificial intelligence and machine learning, blockchain, payments, advanced analytics and big data, regulatory compliance tools, cybersecurity, authentication, and streamlining customer experience, among others.
During the 12-week bootcamp in Little Rock housed in the city’s downtown Technology Park, Miller said the program’s participants were mentored by local business leaders and executives, ICBA staff, and member bank executives from the trade group’s pool of more than 3,000 banks from across the U.S.
The curriculum studied over the past three months included instruction on compliance, regulatory issues, security and risk management, he said.
The Venture Center also runs the similarly-styled FIS FinTech Accelerator program that has brought international attention to the city’s historical link to the financial technology sector.
That three-year program is sponsored by Jacksonville, Fla.-based, Fidelity Information Services Inc. (FIS), the world’s largest financial technology services giant that has its roots with the former Systematics and Alltel Corp. and Little Rock investment firm Stephens Inc.
ICBA President and CEO Rebeca Romero Rainey told the tech-oriented Little Rock audience that the Washington, D.C.-based trade group decided to participate in the Arkansas-based accelerator program because of those fintech and banking technology ties. She said new innovations will be the key to the viability and future success of smaller banks.
“We are doing this because we believe in the future of community banking,” said Rainey. “We couldn’t be more excited about what this does in the future, and so excited to hear where these companies will lead our community banks as we go forward.”
As the largest trade group for Main Street America banks, ICBA members have more than 52,000 branches nationwide and make up 99% of all banks. Altogether, community banks employ more than 760,000 U.S. workers and are the only physical banking presence in one in five U.S. counties, said Rainey. Combined, those banks have $4.9 trillion in assets, $3.9 trillion in deposits, and $3.4 trillion in loans for consumers and businesses of all sizes.
The companies that participated in the 2019 program and gave final presentations include:
• Adlumin, Alexandria, Va.
• Agora, New York, N.Y.
• Botdoc, Monument, Colo.
• CRiskCo, Brisbane, Australia
• KapitalWise, New York, N.Y.
• MK Decision, San Diego, Calif.
• Sou Sou, Washington, D.C.
• Teslar by 3E, Fayetteville, Ark.