News Column

TechStars Bringing Startup Accelerator Program to Austin

May 17, 2013

TechStars, a Boulder, Colo.-based startup accelerator, is bringing its boot camp for entrepreneurs to Austin.

Ten to 12 companies will be chosen to participate in the three-month mentoring program, which will begin in August.

Founded in 2006 by Boulder entrepreneur David Cohen, TechStars runs annual programs in seven cities including Seattle, New York and London. Hundreds of companies typically apply for one of a dozen spots.

"We like to be in strong tech centers, and the time is right to be in Austin," said Jason Seats, an entrepreneur and former Rackspace executive who will manage the office here. "There is a strong foundation of entrepreneurs, mentors and investors, and there has been a lot of recent success. It feels like we're at this inflection point where a lot of really exciting things are going to happen in the next decade."

Austin is home to several accelerator and incubator programs, which operate using various models. Last year, DreamIt Ventures, a Philadelphia-based startup accelerator, opened an Austin office where it hosts three-month boot camps.

Capital Factory, which was started by a group of local technology veterans in 2009, initially held three-month camps but now offers a year-round program.

Austin Technology Incubator, the oldest of Austin tech incubators, provides office space and mentorship and has worked with hundreds of companies since its founding in 1989.

Of the 211 companies that have completed the TechStars program, 81 percent are active, 9 percent have been acquired and 10 percent have failed.

In exchange for a 6 percent stake, TechStars provides participants with $18,000 in seed funding as well as a $100,000 convertible debt note by a group of venture capitalists. In addition, company founders receive mentorship from experienced entrepreneurs and the chance to pitch to angel investors and venture capitalists at the end of the program.

Applicants for the Austin program can be from anywhere but must be willing to move here to take part. TechStars will begin taking applications on Wednesday at its website, www.techstars.com.

The program will accept companies that are at any stage, from those with just an idea to those that have launched their products.

The Austin boot camp will take place at Capital Factory's downtown headquarters, and TechStars is tapping into Austin's pool of seasoned entrepreneurs and investors to take part as mentors.

So far, mentors include Thomas Ball and Mike Dodd of Austin Ventures, Sam Decker of Mass Relevance, Jeff Dachis of Dachis Group, Joshua Baer and Bill Boebel of Capital Factory and Kip McClanahan and Morgan Flager of Silverton Partners.

Baer, a Capital Factory co-founder and long-time investor in startups, said TechStars' arrival adds a valuable new resource for Austin startups.

"The more people we have here funding startups and helping companies, the better," Baer said. "TechStars is a very high-quality program -- every time there's independent rankings they're right at the top. I expect they will attract a lot of startups to Austin to take part in the program, and those people will decide to stay and build their companies here."


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Source: (c) 2013 Austin American-Statesman, Texas. Distributed by MCT Information Services


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