Greenstart commits to funding, accelerating, and offering high caliber design services for 55 digital cleantech startups over the next 5 years. Specifically, Greenstart is launching a Design Practice to offer extended design services to the startups they work with, an unprecedented new opportunity for access to low-cost, high-caliber design work.
GREENSTART'S ACCELERATOR PROGRAM: Greenstart will run two three-month Accelerator programs per year. Hundreds of startups are expected to apply every cycle (Greenstart has averaged 150 applicants per cycle to date), and only a handful of the most promising startups will be chosen (under 10). These startups come from across the USA, and the few that are selected take up residence in SF for 12 weeks during the program. They are able to work in the Greenstart Loft, Greenstart's office and a collaborative workspace in downtown SF shared by all the startups.
Once selected, the chosen startups selected will receive five major things: $115,000 in seed capital, access to an elite network, one-on-one coaching with serial entrepreneurs, professional product design services, and introductions to hundreds of investors to help raise additional capital.
The seed capital is provided in two forms: $15,000 from Greenstart for 5% equity, and a separate $100,000 convertible note from a group of angel investors. The capital is intended to sustain the startup for the short 12-week period while they are participating in the program, and remove the distraction of fundraising during that time.
The network consists of Greenstart's 40+ Mentors, a community of over 200 investors, their alumni startups, their Program Partners (in law, accounting, banking, etc), engaged experts, and thousands of community members who support Greenstart's mission. These individuals have collectively pledged to be of help to Greenstart's startups as needed, in many forms. The introductions, connections, and services this network can provide is like a booster-shot of energy for a young startup, helping them more easily and quickly acquire the relationships and resources they need to succeed.
The one-on-one coaching from serial entrepreneurs comes in two forms: from the Greenstart Partners Dillon McDonald and Mitch Lowe, and from 'Matched Mentors' who are matched with a single startup and meet with them weekly throughout the program. The number of hours spent in one-on-one coaching is approximately 5 hours per startup per week, and covers topics ranging from core business strategy, pricing models, talent acquisition, legal strategy, fundraising strategy, financial planning, and building a strong company culture. This customized, personal attention for serial entrepreneurs who have successfully navigated any issue a startup currently faces is invaluable.
The professional design services Greenstart offers is a very new addition to the Greenstart Accelerator, and is led by our newest Partner and Chief Design Officer David Merkoski. David leads a team of designers who work with each startup and help map out a scope of work to be achieved during the program: it's a mix of identity work (brand, color palette, logo, presentation deck, etc) and product work (user experience, user interface, customer journey maps, wireframes, physical product design, etc). The caliber and depth of these design services can normally only be afforded by major corporations, by giving our startups free access to Tier 1 design services, they gain an immediate incredible advantage and their core products improve immensely during the program.
The introductions to investors are the final chapter of the Greenstart program, and come in two forms: the chance to pitch live to 200 investors at Demo Day (Greenstart's major final event of the program), and personal introductions that are hand-tailored and performed by Greenstart Partner Dave Graham, who manages relationships with out 200+ investor community. By thin-slicing the big wide world of venture capitalists and angel investors, we save our startups valuable time by helping them to only focus on pitching investors who are a good match for their company. We also create an incredible sense of demand around Demo Day, where investors literally sit next to their competition and are naturally urged to get serious about investing in a company before it's too late.
GREENSTART'S DESIGN PRACTICE: The new aspect of Greenstart's CGI commitment is the following: we are launching a new Design Practice to provide extended design services to our startups after they leave our Accelerator.
Greenstart's Design Practice will be a Tier-1-caliber design firm available exclusively for the digital cleantech startups who have graduated from our Accelerator program. This is the first Design Practice directly embedded in an Accelerator, and presents an unprecedented new opportunity for digital cleantech startups to differentiate and flourish through access to low-cost, high-caliber design work.
The premise of embedding a Design Practice in an Accelerator is both novel and innovative for the following reasons: Startups formerly did not have access to Tier-1 design services - elite design firms generally only work with large corporate clients who can afford their fees. In rare cases, a startup could work with a Tier-1 design firm if they had already raised millions of dollars and had generated enough 'buzz' for a design firm to choose them to be a reduced-rate client. As well, if a startup does pay for design services, a huge amount of the total cost of the project is spent in the 'discovery' phase, wherein the design firm is paid simply to learn enough about the client startup to being proposing work. This phase is eliminated in the Greenstart model, since we've already built a relationship with each startup that would outstrip even the most rigorous discovery phase. Lastly, a critique of Startup Accelerators is the idea that they 'drop' their startups after the 3 months, when the program ends. By serving the startups via their Design Practice, Greenstart continues to help their start-ups after the program ends, and ensure a strong tie that keeps the relationship with the startup strong. While Greenstart is unable to offer this extended design work for free, their fees are far below market rate and offer a nearly unfair advantage to our startups who can take advantage of the service.
We plan to follow this schedule of selecting, investing in, and accelerating startups:
August-October 2012 - 5 startups
February-May 2013 - 5 startups
August-October 2013 - 5 startups
February-May 2014 - 5 startups
August-October 2014 - 5 startups
February-May 2015 - 5 startups
August-October 2015 - 5 startups
February-May 2016 - 5 startups
August-October 2016 - 5 startups
February-May 2017 - 5 startups
August-October 2017 - 5 startups
Total = 55 startups over 5 years
It is incredibly difficult to start a company. America needs the jobs, innovation, and impact that startups can bring to its economy, but over 90 percent of startups fail.
Cleantech companies have a recognized funding gap of early-stage capital, due to low market returns from cleantech investments of the last decade, as well as public failures like Solyndra. Capital constraints limit cleantech startups from being able to hire the people they need to build their product and go to market; talented product designers are particularly difficult to acquire, and yet critical for success.
America's economy also faces major challenges due to over-dependence on fossil fuels. To ensure an economically vibrant, secure, and competitive nation, the country will need to dramatically reduce its fossil fuel consumption, and significantly ramp up renewable energy production and integration.
Greenstart was created to help solve both of these problems: to help cleantech entrepreneurs succeed, and to help America quickly and profitably transition away from fossil fuels. Our mission is to unleash entrepreneurship in pursuit of tackling the energy challenge. By giving cleantech startups the resources and support they need to succeed, Greenstart can create jobs, wealth, and economic competitiveness, all while accelerating the country's transition from fossil energy to renewable energy.
As a Startup Accelerator, a new model for helping early-stage entrepreneurs succeed, Greenstart is on the cutting edge of entrepreneurial innovation. Accelerators are for-profit, privately held, and make small investments into the companies they work with in exchange for equity. Accelerators are highly selective in who they accept, and are focused on helping startups from any geographic region become profitable.
Lastly, Greenstart's focus on Digital Cleantech should be defined. Digital cleantech is the intersection of clean technology and information technology for any startup that is reducing the use of dirty energy or expanding the use of clean energy, and uses software in some way. Examples include: software for controlling batteries on the grid, software and apps for managing building energy use, information systems for electric vehicles, collaborative consumption websites, software platforms to crowd-fund renewable energy or energy efficiency, software-hardware systems to help utilities improve the grid, etc.