The who, what, when, where and why of the Iowa Startup Accelerator

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By Eric Engelmann and Sarah Binder

Ready. Set. Grow.

Iowa's first intensive startup accelerator is now taking applications.

Accelerator programs are typically highly competitive. The young businesses that get in are supported with intensive training, mentoring from industry experts and funding to help them grow. Iowa's first such program will last 90 days, beginning on August 4.

Similar programs exist around the world and around the Midwest: in Wisconsin (Gener8tor in Madison and Milwaukee) Illinois (TechStars in Chicago), Nebraska (NMotion in Lincoln and Straight Shot in Omaha), Missouri (SparkLabKC and Sprint's TechStars mobile health accelerator in Kansas City and Capital Innovators in St. Louis) and more.

"We've got some great people doing amazing things with startups all over the state. We have coworking spaces in Iowa City, Coralville, Cedar Rapids and elsewhere.  We have some really great events going on. But one thing that other states have built, that we haven't, is a time-boxed accelerator program,”  wrote Eric Engelmann, CEO of Geonetric and one of the founders of the Iowa Startup Accelerator.

Applications officially opened Feb. 19, when Engelmann appeared at 1 Million Cups in Des Moines.

In the first month of the accelerator program, startups will focus on the foundations of launching a business and building connections to a pool of mentors. The second month will include a series of weekly product iterations as entrepreneurs work to quickly prototype and validate their products. The third month is all about getting ready to pitch before a demo day at the culmination of the program.

“You compress learning in a really really short time frame,” Engelmann wrote. “That means an incredible mentor network, the funding to get your business off the ground, access to technology and talent, and a program to keep them focused on the right priorities.”

The hope is that this programming can create a "talent magnet."

“Right now there are few startups that move to Iowa specifically to start their business here,” Engelmann wrote. "Think of Boulder, for example. Part of their success is that there is a ton of technical talent there, and they're well connected to each other. Even talent at large corporations wants to be around the ideas and creativity that startups bring. Iowa is a talent exporter right now. If we do this right, we'll be importing top-notch talent from other states and countries instead of exporting it.”

The Iowa Startup Accelerator model closely follows that of TechStars and other nationally-known accelerators. Each happens in a very short time frame, and is competitive and mentorship-driven. Engelmann said in the first year, he plans to follow the established model pretty closely.

In following years, he'll be more ready to do what he loves best: experimenting with new ideas.

Who is behind this?

The founding team includes prominent members of the local business community: Barry and Gilda Boyer, formerly of Van Meter and Shuttleworth & Ingersoll, respectively, Lydia Brown of Ascent Iowa, Ben Dillon and Engelmann of Geonetric, Bruce Lehrman of Involta, Michael Ott of Nidus Investment Partners, and Andy Stoll and Amanda Styron-West of Seed Here Studio.

Sponsors include Geonetric, Shuttleworth & Ingersoll, Bergan Paulsen, 512 Creative and ImOn Communications, which is providing up to 10 gigabits of bandwidth to the accelerator.

The accelerator will also bring in up to 100 mentors to work with the nascent companies.

Who actually works for the accelerator?

Engelmann anticipates four part-time staff positions: a managing director to oversee the entire accelerator, a program coordinator to work directly with each team, a marketing coordinator and a community manager.

The accelerator may also hire part-time technical or business associates during the three months the program is active.

Who can apply?

Early stage companies from around the nation are welcome to apply, although Engelmann expects to see teams that have already begun work.

“It's designed for early stage startups, but if you just have an idea and that's it, you're not ready,” he wrote.

The Iowa Startup Accelerator is looking for startups that:

• Have teams that have already worked together
• Have experienced team members with the mindset and maturity necessary to handle startup life
• Have a business idea with an important insight that solves a significant market problem
• Have scalable business models that have tremendous growth potential large enough to be worth investing in
• Are in target technology sectors: the accelerator will accept applications from any technology-based company, but will be specially tailored for technology startups in the education, healthcare, agriculture, green tech and biosciences fields.

Up to 10 companies will be accepted.

Companies can be from anywhere around the world, though Engelmann expects a Midwestern regional emphasis.

So how can teams prepare?

Engelmann and a few others recently traveled to California to learn about the Lean Launchpad methodology, and in future years, they hope to create programming leading up to the application process. This year, Engelmann said community events including Startup Weekend can begin to fill that role.

The accelerator will also share some programming with JPEC, the John Pappajohn Entrepreneurial Center at the University of Iowa, which is launching a student accelerator this summer.

How will teams be chosen?

Engelmann expects up to 500 applications by the June 22 deadline. Teams will be ranked and prioritized based on the selection criteria above. Some will be invited to video chats (or in person interviews if they're nearby) to further explore how they might fit into the accelerator.

Who are the mentors?

The accelerator will bring in 100 or more mentors to work with the nascent companies. Most of the mentors will be founders of companies, but there will also be investors, technologists, experts in fields that match our target sectors and leaders of fast-growing businesses with networks or expertise to offer.

Interestingly, the mentors will all be volunteers:  “We're only looking for top-flight mentors,” Engelmann said. “With the caliber of mentors we're seeking, these aren't people who sell their time hourly to anyone, but they'll happily volunteer their time for a cause that matters to them.”

The first wave of mentors is listed on the ISA website: www.iowastartupaccelerator.com/meet-the-mentors.

What's in it for participants?

In addition to the mentorship and experience of the accelerator, there is funding involved. Each of the ten teams will receive $20,000 at the beginning of the program in exchange for six percent equity in their business. Additionally, teams can apply for $100,000 in additional financing from the accelerator.

The conclusion of the program, Demo Day, on Nov. 6, will introduce the teams to potential investors. They'll also have the opportunity to meet with numerous investors along the way during the program.

What is the business model of the accelerator itself?

The accelerator is made of two entities:

1. The accelerator itself is a non-profit 501c3 that operates the facility and runs the program, and educational programming for startups when the accelerator isn't in session. Engelmann hopes to complement existing programs from JPEC, the EDC, SBDC, SCORE and others.

2. The $20,000 per team comes from a separate, for-profit seed fund that invests in each of the startup companies.

Engelmann is in the process of securing funding for the first five years of operation from both sponsors and investors.

“The non-profit program will be a huge asset to the Corridor startup community,” Engelmann said. “We're building on top of offerings that exist from JPEC in Iowa City and EDC, SBDC and SCORE in Cedar Rapids. For example, we'll provide technical training specific to the types of startups we're looking for, and speakers and events that we don't have here yet.”

The accelerator will also be able to expand current community offerings, like the popular 1 Million Cups, with a space that can hold 120. The ISA will also host and cultivate free meetups on a variety of topics, from software development techniques to running businesses without formal management.

“Iowa City has done a great job fostering an environment with lots of easy to access meetups across a broad spectrum of topics,” Engelmann said. “We hope to replicate that in Cedar Rapids.”

The for-profit seed fund adds another element, currently not present in Eastern Iowa.

“The ISA seed fund is a unique investment opportunity because you get to participate in a pool about 30-50 companies that we'll accelerate over five years. Rather than having to pick individual companies to invest in, seed fund investors can think of this like a managed portfolio of startups,” explains Engelmann.

How is this different than other resources in the state?

While business accelerators and incubators exist in Iowa, including the EDC in Cedar Rapids and Startup City in Des Moines, the Iowa Startup Accelerator is different in that:

• Participants are in and out in 90 days. The program is designed to be incredibly intense and focused, and works only with startups that are willing to commit to being “all-in” for those 90-days.
• All of the teams start and end at the same time. There are tremendous opportunities for the teams to learn from each other as they go through the program, Engelmann said.
• ISA takes the very best applicants from anywhere in the world, not just Iowa-based companies.
• The teams have to move to Cedar Rapids for 90 days. While they aren't required to stay in Iowa after the program, they will certainly be encouraged to stay.
• ISA pays teams to come to Iowa, as opposed to having to pay to be a part of the program.
• It's designed to be a talent magnet, bringing technical talent to the area.

Where?

At Geonetric's under-construction building at 415 12th Ave. SE. The building will also house Vault Coworking and Collaboration Space, the BIG Ideas School, The Cedar Rapids Blue Zones project and other innovative organizations.

“The vision for the whole building is wider than Geonetric or startups: we're trying to build a physical space that's for people who want to change the world,” Engelmann wrote.

When?

The 90-day program will run from Aug. 4 to Nov. 6. Applications are due June 22.