Earlier this week Flashpoint, Georgia Tech's new startup accelerator, held it first ever demo day. While really a bit more of a pitch day, I only saw one demo, the teams did a great job. Locally David Cummings has a nice summary of the companies that pitched and TechCrunch even covered the event.
While in many respects it is to soon to tell, the capstone of the program begs the question "is Flashpoint a success?" The early answer is yes.
This answer is based on my involvement in the formative stages of Flashpoint back in the second quarter of 2011. Call me a bit player but I was a member of Flashpoint's formative team. I was there when we hashed out the concept of "startup engineering", an idea of Merrick Furst's that I thought was brilliant when he first pitched it. I there when we defined winning (we actually used the word) as creating two or more fundable companies after four months. It is a real metric. So how is Flashpoint doing against it?
Flashpoint is winning. Pindrop Security recently received an investment from Sand Hill road based Andreessen Horowitz (a little cherry picking perhaps from Flashpoint's valley demo day event host). And word is, while a bit odd to be jumping from accelerator to accelerator, that two Flashpoint companies will be joining the next Y Combinator class where they are assured to get $150k in funding from Yuri Milner's and Ron Conway's Start Fund. Add in Social Fortress' executed term sheet to raise $2 million (they still have to fill out the round and that is often quite difficult), and you have between three or four companies that have become fundable. In terms of the goals of Flashpoint, that is winning.
And it is still early. The Flashpoint companies have come a long way in four months. It is going to be most interesting to see how they are received next week when they enter the land of Fred Wilson for demo day at Union Square Ventures in NYC and they week after at Andreessen Horowitz in Menlo Park.
So I have known Paul Stamatiou for nearly four years now. We met at Atlanta Startup Weekend in 2007. He pitched Skribit at that event and my thought when he did so was great idea, we can build it, not so sure about the market. The market turned out to be small.
About a year ago Paul packed up and moved West. He ended up working on a Y-Combinator startup called Notifio. That one I did not get at all.
Well earlier this summer we shut down Skribit and Paul got involved with yet another startup (seems like one of the big benefits of YC is safe landings). It went through the monster size YC class this summer. I had no idea what he was doing except working hard.
Last week I got a note from Paul. Essentially said, go take a peek at this. This was Picplum. Picplum is aiming to be the easiest way to send photo prints. Nice service and I can see how this would be a big winner with parents of young children. Those grands in faraway places really like to have prints.
Picplum is a monthly subscription service starting at $7 per month. You upload or email them photos, add a list of recipients and they automatically print and mail photos. Automatically being the key term.
Picplum has an interesting back story. They acquired the assets of previous YC company Picwing, and took over its printer relationship and initial user base. It seems that another Paul, Paul Graham, was a big fan and user of Picwing. The Picwing founders had gone off in another direction and PG was looking for someone with some passion to take it over. As I recently minted uncle Stamatiou was just the guy to do it.
The Picplum product is built fresh from the ground up. But they have a built in customer base and lots of interesting data to help them to understand the business.
PicPlum is offering a special to the readers of FoG which enables you to give the service a whirl by offering your first batch of photos free to two receipents. Here is the landing page to use the promo code.
On Monday the White House announced the Startup America Partnership. Startup America is a White House initiative to celebrate, inspire, and accelerate high-growth entrepreneurship throughout America. Below is a nice video of Austan Goolsbee the Chairman of the Council of Economic Advisers explaining the program.
About the only criticism I have about the program is the expression "valley of death." I live in startup land. I have never ever heard anyone say "valley of death." Regardless the four main points Mr. Goolsbee makes are that Startup America will:
Expand access to capital for startups;
Identify and remove unnecessary regulations that are barriers to startups;
Startup America is the capstone of a sea change that has been taking place. For years and years governmental economic development efforts have mostly focused on big companies. Then last year, at least in Atlanta, something started to happen. It seemed like all of a sudden people realized that startups create jobs. Lots of groups starting turning their attention to startups. Why this happened I am not sure. But I am very encouraged that the White House understands the importance of entrepreneurship and startups in expanding the economy and creating jobs. I am also very encouraged that Startup America is getting the right people and organizations involved.
As part of the Start America kickoff 27 public and private commitments were announced. As far as I can tell there is no entity from Georgia involved. There should be. The state of Georgia needs to leverage the Startup America program with it's own economic development funding. It needs to get the right people and organizations involved. It needs to tap into existing startup support expertise (such as ATDC one of the world's top ten incubators). Doing so will help Georgia technology startups succeed, create jobs, and give Georgia an opportunity to reestablish itself as a technology leader.
In a somewhat historic event Bud Peterson president of the Georgia Institute of Technology and Michael Adams president of the University of Georgia came together on Monday to officially launch ATDC's new presence in Gwinnett County. ATDC, a Georgia Tech based technology business accelerator has established a presence on the University of Georgia's Gwinnett Campus.
It has been amazing just to watch the growth of the Showcase itself. In the past four years it has expanded from a somewhat intimate setting in the Technology Square Research Building, over to the grand Biltmore, and this year moving on to the more spacious Georgia Tech Hotel & Conference Center. It's going to be a big show. Registrations, even with an entry fee, are on pace for last year. When it is all said and done I expect the largest attendance yet.
Bud Peterson, the president of Georgia Tech is going to kick things off and then vice president Stephen Fleming is going to give an update on how the new ATDC is working and what to expect over the coming year. Then the show will move on to graduate members CommerceV3, Endgame Systems, Izenda, and Purewire (acquired by Barracuda) presenting their stories before the member exhibits open up. The day will conclude at the bar with a special version of Startup Drinks.
Please join me, my partners in crime at ATDC, our expanded member companies, and a big hunk of the Atlanta technology world at the Startup Showcase by registering to attend.
ChubbyBrain, whose name is perhaps only surpassed by BackPackBuddy, is issuing a series of reports on the state of incubators around the nation. They recently covered Georgia. Not surprisingly, ATDC dominates the market with over a 50% share when you combine the Atlanta and Savannah results.
ATDC is really not just an incubator any more. It is more of a venture accelerator with an incubation space for companies that need it. If you do the math on the old ATDC data that CubbyBrain used of 39 companies it would put the total market at about 75 companies incubating in Georgia, or 36 non ATDC companies. ATDC now has 218 member companies. The ATDC share under the new model is more like 86%. It also makes ATDC the largest program in the country.
Russell Jurney suggested yesterday via Skribit that I write an article about "ATDC Sponsored Coworking Space" and it was quickly voted up as a popular topic. So I gotta say something.
But before I do I need to point out something else. This is my personal blog. As it clearly states in the disclaimer in the lower right, the opinions expressed here are mine, not those of my employer. You want the official ATDC word venture over to PeachSeedz. Everything I say here does adhere to my personal values, which can be summed up in two words. Be good.
So with that out of the way, here goes.
ATDC has long been internally discussing offering something like coworking space. The drivers of this have been finding room for entrepreneurs when they are in the early stages of concept development as well as ventures that are not quite ATDC ready but need space. Lay on top of this that ATDC embraces the social and collaborative aspects of the coworking process and is a non-profit focused on community it may be in a good position to foster coworking in Atlanta. With a healthy mix of companies prepping to move beyond the physical confines of ATDC in the fall and some room opening up it seems like it may be time for action.
So with all this in mind I recently entrusted ATDC trusty graduate assistant and aspiring entrepreneur Blake Perdue to undertake a project to investigate the prospects of bringing coworking to ATDC. He is in the early stages of this endeavor and I expect a recommendation from him some time next month on how ATDC may be able to play. While I am going to make a few predictions on what may fall out of this, I am not going to predict if this is something that ATDC is going to do. Beyond me. If it does happen I anticipate the following will be part of a plan.
As a state funded not for profit entity ATDC is not in a position to offer free space for coworking. If you need to know why just do a quick search on the Georgia state budget crisis. ATDC may be able to offer space at the same rates as those companies that are in the incubator program. This pricing is heavily subsidized. If ATDC were to set aside 1,500 square feet for a coworking type program we could offer space to about 15 FTEs at a cost that is typical of other coworking setups. From what I know at the moment that runs from $240 to $400 a month per person. If more is needed then I would encourage the community to seek additional sponsorship.
ATDC will remain true to its roots of helping Georgia technology entrepreneurs. Whatever happens will be focused on helping startups, not the broader work-at-home professional and independent contractor class that coworking targets.
Like the ATDC incubator program I would guess that it would limit the time that an individual could participate in the coworking program to rotate the participants and offer more opportunity to a broader group.
The facility would only be available during normal office hours and participants would need to arrange for their own public transportation or parking.
That's it. Again this is something ATDC has under study. If you are interested in helping to make this a reality I encourage you to reach out and work with Blake on a plan that will work for all.
And if you need some space before we get this all figured out I encourage you to make use of the Entrepreneurs Resource Center. It is on the first floor of Centergy. Can accommodate about 10 people. And it's free.
And if you care to discuss here, please do. Just be good.
A long, long time ago in a place not so far away, Catalyst Magazine used to have a series where they would interview a prominent Atlanta technology person. One of the questions they routinely asked was “What’s the best seat in Atlanta?” The most excellent answer ever award goes to Kathy Harris of Noro Moseley who replied, “The bar at Taqueria del Sol.”
With all due respect to the West Side Margarita, I gotta tell you, the seat that I have at ATDC right now is pretty hard to beat.
First of all it literally looks out over Tech Square. But more importantly, I get to interact with some amazing entrepreneurs, good angels and VCs, savvy technologists, and smart academics. Every day is at least one new startup case study. Every day I learn something. Every day I see a new concept. Every few weeks or so I see a great concept. About once a quarter I find something great that I know I could make go. It really is an ideal sentry position. The master plan to achieve my goal of founding and leading a successful technology company is working.
Today is my one-year anniversary at ATDC. In addition to spending lots of time with applicant and member companies, I have been focusing on opening up the ATDC and making it both more accessible and more meaningful to a larger number of entrepreneurs. The biggest visible manifestations of this effort can be seem in the new programs ATDC is undertaking. Over the course of the past year we have surveyed entrepreneurs to see how ATDC can better assist them, launched PeachSeedz, hosted BarCamp, reached out to TechJournal South to bring DeckParty to Atlanta, and been the driver behind Startup Weekend heading this way. While there is always an opportunity for improvement, the general feedback is that we are heading in the right direction.
When I joined ATDC I made a two-year commitment to Tony and the ATDC team. One of those years is behind me now and it has been a successful one. Over the course of the next year, with the help of my teammates, you will continue to see more of the same.
But I am also going to start putting my master plan into higher gear.
I started a bit of chatter that lead
to a bit more
in these parts for the need for a Y Combinator in Atlanta. It dawned on me that lots of the
FoG faithful may have no idea what this means. On their web site it explains that Y Combinator
"is a new kind of venture firm specializing in funding early stage
startups. We help startups through what is for many the hardest step, from idea
to company."
So what exactly does Y Combinator do?
1. Focuses on Web apps: Y Combinator focuses on software and Web
services. Most of the companies that I have heard coming out of there are
Web apps. Regardless they focus.
2. Has an application process: Y Combinator has two application
processes. One in the spring for a Boston summer session and one in the fall for a winter bay area session. The app
is a straightforward web form. They do not ask for business plans. The
most promising applicants are asked to travel to one of the above places to
make a presentation. $500/person in travel expenses is reimbursed. The
app process is about three weeks long.
3. Requires relocation: Astute readers will gather from the
above that the program requires relocation.
4. Seed investments: Y Combinator typically invests $5,000 plus
$5,000 for each founder. A startup of 2 would get $15,000. This is
an equity investment of between 1% and 10% of the company. Typical is
6%. If I am doing my VC math right that is $235,000 pre. Not bad
for an idea.
5. Offers no space. Y Combinator is not an incubator and claims
that the startup can do anything it wants with the money it receives.
However, Y Combinator does strongly encourage companies to work out of wherever
they find to live. It seems that lots of them end up renting in the same
place so they have what Paul Graham refers to as an exobator.
6. Short programming. The Y Combinator program lasts about 10
weeks. There are weekly dinners on Tuesdays and open houses at Y
Combinator on Wednesdays for entrepreneurs that want to show off their stuff or
talk strategy.
7. Product orientation. Y Combinator wants their companies to
create a demo of their product. The demo focuses on a problem the company
is trying to solve and shows how the product solves it.
8. Not business plans. Y Combinator does not care too much about
the business plan. In the app process or while in the program. They
rightly think that it is too early to have a solid business plan that is not
going to change.
9. An investor day. The program ends on Angel Day when Y
Combinator invites all the angel investors it knows to come in and see the demo
presentation. I hear tell that Paul Graham knows lots of angels.
10. Success. At his talk at Startup
School, Paul said Y Combinator had invested in 8 startups and 4 succeeded.
Batting 50% thus far for early stage ain't bad. They expect this figure
to settle in the 25% range.
So there you have it. So the question then becomes would it be
possible to replicate this activity in Atlanta?
That is the subject of a bit of research and a future post.
Force of Good is licensed under a Creative Commons License. You are free to share, remix, and share alike with attribution.
DISCLAIMER
The opinions expressed here are mine and mine alone (with the exception of comments by others of course). They do not represent the opinion or position of any other person or entity. All postings adhere to my personal values.
