Austin Technology Incubator Generates Thousands of Jobs and Millions in Economic Impact, Report Finds

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March 5, 2014

AUSTIN, Texas — The Austin Technology Incubator (ATI), and the private companies it has nurtured, generated 6,520 jobs and produced $880 million in economic benefit for Texas during the past decade, according to a new study of the business incubator’s success.

ATI’s contributions have come as Central Texas has experienced an economic and high-tech boom. The report detailing these successes comes as the region prepares to host the 21st annual SXSW Interactive Festival, which draws global attention to the area’s tech industry.

“ATI companies have generated significant economic benefits for the state of Texas, and specifically for Travis County and the City of Austin,” concludes the report, which was published by the Bureau of Business Research at The University of Texas at Austin and drawn from an analysis by researchers at the University of Colorado at Boulder.

ATI is also a unit of UT Austin and is affiliated with the university’s IC2 Institute. ATI leaders commissioned the report but were not involved in writing it.

“In addition to educating great students and conducting top-tier research, UT Austin has fueled the high-tech industry by nurturing startup companies. ATI has been at the heart of that,” said university President Bill Powers. “Director Isaac Barchas and his team at ATI have been integral to tapping into Austin’s entrepreneurial spirit and making our city a technology capital.”

Celebrating its 25th anniversary this year, ATI works with seed- and pre-seed-stage technology startups, offering expert guidance and connecting the companies to local mentors and potential investors. It has nurtured companies in the pharmaceutical, semiconductor, electro-medical and energy industries, among others.

The report looks at the impact of the 39 startups that graduated from ATI between 2002 and 2013, including 30 companies that provided financial information to the authors and nine whose contributions were estimated by the Colorado researchers. The report found that these firms:

  • Generated $880 million in total economic benefits for the state
  • Created more than 6,520 jobs directly and indirectly
  • Produced more than $20 million in local tax revenue

The report also offers seven case studies of companies that graduated from ATI before 2003 and highlights their successes and economic contributions.

Multiple companies from that era went on to receive significant venture capital funding, become publicly traded or were purchased by other firms. Many of the companies’ founders went on to establish other startups, took on leadership positions in major corporations and returned to ATI to mentor other startups.

“By any economic metric, ATI’s effect on the Austin technology ecosystem has been profound,” said Jim Jarrett, the Bureau of Business Research’s lead researcher on the report. “But perhaps most important, as the report’s case studies show, ATI has nurtured deep changes in the economic culture of the region that will last far into the future.”

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