BUFFALO — Until two weeks ago, Ace Callwood had never set foot in this chilly, postindustrial city, but he committed, sight unseen, to move his fledgling technology business and its four employees here. The lure that drew him was cash: a guaranteed investment of at least $250,000 and a shot at as much as $1 million.

Mr. Callwood’s company, Painless1099, was one of 11 finalists in 43North, America’s largest business-idea contest, which recently held its second annual competition. With $5 million in prize money, the venture aims to retain local entrepreneurs and attract new ones to Buffalo, a city that has lost more than half its population, and many of the industrial giants that once fueled its economy, over the last 65 years.

Buffalo’s downtown is filled with signs of both the area’s struggles and its steps toward revitalization. New restaurants and retailers, along with the decades-old ones that have endured, sit adjacent to derelict buildings, many of which still bear architectural traces of the area’s more prosperous past. The toll of Buffalo’s economic troubles is even starker in the outskirts of the city, which has a poverty rate that tops 30 percent and a median household income of around $31,000.

This city has been a focus of Gov. Andrew M. Cuomo, who visits often and pledged $1 billion in tax breaks, grants and other aid. A portion of that money helped seed 43North, which emerged from brainstorming sessions with consultants hired to help develop a plan for the so-called Buffalo billion. The program also has private sector sponsors.