Terry Horner of the ‘Spent’ team practices his pitch to the other Iron Yard Labs’ members in the Next Innovation Center in downtown Greenville. (Photo/firnFOTO)
By Liz Segrist
Published Aug. 15, 2012
More than 320 hopefuls applied from 19 countries.
Ten teams made the cut, becoming the first class of Greenville-based Iron Yard Labs, an intense, 13-week training ground for business startups.
These teams — some were local and others relocated to Greenville — started the mentorship-driven, startup accelerator in May with the hopes of securing funding to launch their product, app or startup.
Teams often work 20-hour days, huddled around tables and writing on the walls of their space in the Next Innovation Center in downtown Greenville.
Peter Barth, program manager of Iron Yard Labs
And it all comes down to 10 minutes on Sept. 13 — Demo Day.
Demo Day is an opportunity to pitch in front of hundreds of angel investors and venture capitalists. Although teams pitch to groups throughout the summer, both locally and at neighboring cities like Atlanta and Raleigh, this is the largest pitch session.
“It’s different than an incubator because it’s only 13 weeks, but it’s such an intense period that it wouldn’t be sustainable to continue that intensity. You’d burn out,” said Peter Barth, the program manager. “It’s a short burst where you set milestones that you have to hit and deliver. It would take nine to 12 months to do what they’re doing in three months.”
Barth plans to expand the startup accelerator — or “the latest flavor of a business incubator” — to twice a year with one class each spring and fall. He has about $750,000 committed of the $1 million needed to run the two sessions in 2013.
The Iron Yards Lab is part of the Global Accelerator Network, which consists of independently owned and operated regional organizations that operate startup accelerator programs worldwide.
As a former stock broker and options principal with a background in computers and finance, Barth decided to start the Global Accelerator Network’s Southeast footprint in Greenville.
Barth reviewed all of the applications within two weeks, including 87 video conferences in one week, and made his 10 selections.
Kambit enables people to give back to the causes they care about by leveraging online shopping via affiliate marketing.
Leaguevine gives non-professional athletes online sports profiles that highlight their athletic accomplishments. Players can log stats from their phones; creating real-time box scores for people to follow and engage with each other.
LocEngine is a workforce management and customer service solution. It enables management of mobile repair service and delivery teams. It includes a pre-arrival notification system, eliminating customers’ waiting period.
MoonClerk allows anyone to immediately start accepting recurring payments online, without any technical skills or coding required.
NoChains enables users to find dives, diners and locally owned restaurants reviewed by the menu, not the venue.
Pathwright is a platform for online schools where users can create, teach and sell online courses under their brand.
RidePost is an online marketplace that aims to change the way people travel by connecting drivers and passengers for safe and social ridesharing.
Spent is a mobile platform that wants to change the way people shop for groceries by analyzing a shopper’s purchase history to provide personalized deals, recipes and messages based on what they actually buy.
Tribr is a Web and mobile app for offline group events that aims to reduce hassles. It includes invitation tracking and group voting; automatic creation of group picture albums; and expense tracking and payments.
Trips & Salsa is a startup that focuses on making hotel reservations for those booking more than 50 hotel reservations. The platform will offer features designed for assistants, office managers and others for negotiating, booking or reviewing travel activities and costs.
SOURCE: Iron Yard Labs
“The people are way more important than the idea,” Barth said. “We look for ideas that are venture capable companies, which means eventually they have to become a $100 million company or it’s not worth the initial investment.”
Terry Horner, Andria Trivisonno and John Krebsbach of the team “Spent” moved from Ohio to Greenville to participate in the Iron Yard Labs. They are building a mobile app to change the way people shop for groceries. It will analyze a shopper’s purchase history through their loyalty cards and provide personalized deals, recipes and messages based on what they buy.
“Why is it that Amazon can tell you what else you might like to buy and Netflix can tell you what you might like to watch, but the grocery store still sends you a paper circular every week?,” Krebsbach asked. “Consumers are at the point where they demand a relative and personal experience.”
The long hours are not without perks. Teams receive their space free of rent in the Next Innovation Center and an initial $6,000 investment per founder, capped at $18,000 per company, from Iron Yard Labs.
Teams have access to an in-house design team; free legal and accounting services; free mentorship and the opportunity to pitch to investors throughout the process, as well as on Demo Day.
Fifty successful business people serve as mentors from a variety of fields, both locally and nationally. Brian Ellin, Twitter product manager; Vikas Gupta, Google payments manager; and Steven Walker, Groupon design manager, are some of the national mentors.
Leighton Cubbage, Serrus Capital co-founder; Matt Dunbar, Upstate Carolina Angel Network co-founder; Frank Greer, Zipit Wireless CEO; Matt Gevaert, Kiyatec CEO; and Bob Hughes, Hughes Development CEO, are some of the local mentors.
Every day has been different for the Spent team. They work with mentors that can bring different opinions to the table. They talk with both retailers to build a workable solution and with shoppers for feedback on their product, Trivisonno said.
“If we tried to do this on our own and didn’t have our peers around us, or our mentors around us, or the guidance of being in a program, we wouldn’t get as much done as quickly,” Krebsbach said. “This program is good for anyone trying to do this.”
The first four weeks involves intensive mentoring in which teams and mentors do a sort of “speed-dating” to find the best matches. The next four-week increment is filled with product development and pitch practices.
During the final four-week increment, the teams travel and pitch to investors in an attempt to secure half of their funding by the week preceding Demo Day.
In exchange for Iron Yard Labs’ investment, it receives a 6% ownership stake. Iron Yard Labs doesn’t desire controlling interests, board seats or uncommon investor rights, Barth said.
Ideally, Iron Yard Labs eventually will fund itself as its successful companies exit the partnership or get acquired, but Barth said that’s likely seven years or so in the future.
Teams do not have to remain in Greenville after the program, although Barth said it would be ideal. Eight of the 10 have committed thus far from the first class. In order for those companies to stay here, the investments likely need to be a combination between local and national investors.
Krebsbach said the mentorship, peer support and opportunity to meet investors has helped their company get its start, which plans to be based in Greenville and used by every grocery retail store.
The Global Accelerator Network provides professional development, networking opportunities, training, consulting and ongoing support for members.
It was created in 2010 through TechStars, accompanied by the White House’s Startup America Initiative. It aims to ensure that 5,000 entrepreneurs and investors will mentor 6,000 young entrepreneurs. Its goal is to create 25,000 new jobs by 2015.