Techstars

Techstars, LLC

Type	LLC
Founded	Colorado, United States (2006, as Techstars, LLC.)
Headquarters	Boulder, Colorado
Key people	David Cohen (Co-founder and CEO) Brad Feld (Co-founder) David Brown (Co-founder) Jared Polis (Co-founder)
Website	www.techstars.com

Techstars is a mentorship-driven startup accelerator founded by David Cohen, Brad Feld, David Brown, and Jared Polis that holds 13 week programs for startups in Boulder, New York City, Boston, Seattle, San Antonio, Austin, Chicago and London.^[1][2] Fewer than 1% of the companies that apply to Techstars are accepted.^[3] Of the 114 companies that have completed its program, 92% are active.^[4] Techstars mentors include Foursquare CEO Dennis Crowley, tumblr CEO David Karp, HubSpot co-founder and CTO Dharmesh Shah, and Fred Wilson of Union Square Ventures.^[5][6][7]

History

After founding three companies in Boulder, Colorado, David Cohen decided to form a startup accelerator and began building a network of mentors within Boulder. The network would simultaneously bring together potentially interesting companies, leverage the entrepreneurial community behind these companies for three months, and then decide whether to invest further.^[8][9]

He enlisted Brad Feld, who had invested in some of the same companies as Cohen.^[3][10][11] They partnered with David Brown, co-founder and president of Zoll Data Systems, and Jared Polis, founder of BlueMountain and ProFlowers, to form Techstars.^[10][12] They recruited 70 web entrepreneurs, venture capitalists, and CEOs to provide mentoring.^[13]

The company was established in Boulder in 2006 and held its first program in 2007 with an initial 10 companies.^[14] Of the 10, 2 were acquired that same year, 3 achieved positive exits by 2012, and 2 currently generate millions in annual revenue.^[13] Techstars used the revenue from these successful exits to expand to four additional cities: in 2009, in Boston; 2010, in Seattle; 2011, in New York City; 2012, a "cloud" program in San Antonio; 2013 in Austin.^{[4][15][16][17]} David Tisch, founder and former managing director of the company’s New York branch, states that Techstars deliberately selected locations away from Silicon Valley because these areas had been relatively overlooked by other entrepreneurs. "^[18]

In January 2011, the firm launched the Global Accelerator Network, which links 22 similar programs internationally.^[19][20] The network was launched in conjunction with President Barack Obama’s Startup America Partnership.^[21] In September 2011, the firm was featured as the subject of a 7-episode reality TV series on Bloomberg TV.^[22] The series follows 6 startups in their New York City program.^[22][23]

Structure

Startups can apply for Techstars’ program and their viability is judged by the program’s directors.^[24] Less than 1% of applicants are accepted into the program.^[25] In particular, of the 1,500 applicants to the Techstars New York Spring 2012 program, 14 were selected.^[26][27] Techstars provides each company with free office space and $18,000 in exchange for a 6% stake in the company.^[14][28] In addition, a syndicate of more than 75 top venture capitalists backs each company with a $100,000 convertible note which converts into equity when the company raises a Series A.^[29]

One of Techstars’ goals is to improve the entrepreneurial ecosystems in the 5 cities in which they operate.^[30] There are between 50 and 100 mentors in each city for 10 to 15 companies.^[30]

Boot Camp

Accepted founders participate in a three-month program in their program’s city.^[31] While there, the founders develop their business under the guidance of mentors and meet with potential investors through Techstars’ network of connections.^[24][31] Mentors for accepted startups include: Foursquare CEO Dennis Crowley, tumblr CEO David Karp, HubSpot co-founder and CTO Dharmesh Shah, Fred Wilson of Union Square Ventures, and Howard Lindzon of StockTwits.^[7][32]

Cohen refers to the Techstars boot camp as three one-month programs.^[30] In the first month the founders engage the mentors and receive feedback on their product or service.^[30] The goal of the first month is to orient the team in the correct direction, with Cohen stating that this is when many companies pivot their focus, market strategy, or idea.^[30] In the second month, founders work with their mentors on specific issues like customer interaction, partner opportunities, and product development.^[30] In the third month, founders develop a plan for action after Techstars, which includes fundraising, pitching investors, launching the product, or developing a company strategy.^[30]

At the end of the 13-week program, Techstars hosts "Demo Day", which can draw over 500 investors, entrepreneurs, and journalists.^[13]

Results and reception

The New York Times notes that “One of the biggest lures of the program is the unlimited access the start-ups get to established tech community mentors.”^[33] Of the 114 companies that have graduated from the Techstars program, 98 are active, 8 have been acquired, and 8 have failed.^[34] The success rate for most technology start-ups is estimated at 10%.^[3] Companies that have participated in Techstars programs currently employ 772 people and 90% of those companies receive funding after graduating.^[35][36] Techstars does not report financial results of its overall portfolio of companies, so, analysis of the financial results of Techstars's stake in its startups is anecdotal at best.

Techstars alumni

• Bizible, an online and offline marketing analytics company.^[37]
• Brightkite, a real time social discovery network, sold to Limbo in 2009, which closed in 2011.
• ClauseMatch, a cloud based collaboration platform designed to make contract negotiations more efficient.^[38]
• Codeship, a software service that lets developers update their apps more efficiently and frequently. It participated in the Boston program and then the founders moved back to Vienna.^[39]
• Distil Networks, the leader in bot detection and mitigation, has 15 employees and has raised more than $2 million in funding and blocked over 5 billion malicious bots.^[40]
• Fancred, a social network for sports fans, where they share items to boost their 'cred' among other fans, and which was incubated at Techstars Boston.^[41]
• Filtrbox, a content monitoring service, sold to Jive Software.
• Flixmaster, who develops software to let users create interactive online video content, has partnered with NBCUniversal and Sony Creative Software and has raised more than $1.1 million.^[42][43]
• FullContact, who builds contact management software and APIs, has 28 employees and has raised more than $8 million in funding.^[34][44]
• Good.Co, a self-discovery platform and network for a new generation of professionals that has raised $1.6 million in funding.^[45][46]
• Graphic.ly, a digital comic book platform, has 20 employees and has raised $4.2 million.^[47][48]
• Infinit, a fast peer-to-peer-based file transfer application that allows sending files of unlimited size in just a matter of seconds.^[49]
• IntenseDebate, a commenting system tool for blogs and news sites, acquired by Automattic in 2008.^[50]
• Lore, a social network for learning that has raised over $6 million in funding and been adopted at over 600 schools.^[51]
• Lua, provides mobile workforce technology to enterprise customers with mostly out-of-office employees
• Mocavo, a genealogy search engine with millions of records and historical documents online ^[52]
• Moni, a money transfer app. ^[53]
• Murfie, a commercial music streaming service that allows users to buy, sell, and trade compact discs and stream or download their contents.^[54]
• Next Big Sound, a music analytics provider, has raised $7.5 million in funding.^[34][55]
• Occipital, a panoramic photo app, sold their technology to eBay.^[56]
• OnSwipe, a tablet platform for publishing and advertising, was listed as one of Time magazine's 10 Best Startups.^[57]
• Orbotix, focused on bringing a new concept of fun through robotics and phone-controlled open devices, raised over $11 million in funding. Their robotic ball Sphero is available in both the Apple Store and Brookstone.^[45][58]
• SendGrid, a cloud email infrastructure, has raised over $27 million in funding.^[34][59]
• Sensobi, a personal relationship manager, was acquired by GroupMe.^[60]
• Shippable, a continuous delivery platform for containerized workflows. Has raised over $2M in funding.^[61]
• ShuttleCloud, specializing in cloud data migration, analysis, and storage products^[62]
• Simple Energy, an energy utility customer engagement platform has been deployed in over 500,000 homes.^[63]
• Sketchfab, a portal to display 3D content online. Has raised $2.5 million in funding.^[64][65]
• Socialthing, which organizes users’ social media, was bought by AOL.^[66]
• StreamRoot, a peer-to-peer video streaming solution to help broadcasters reducing their bandwidth costs.^[67]
• Zagster, which designs, builds, and operates private bike sharing programs for universities, corporate campuses, hotels, and residential communities.^[68][69]

References

External links

• Techstars.com