Offering tools for growth and a supportive environment for entrepreneurs, Memphis' business incubators are now churning out more successful startups—and producing long-term economic benefits for the community.
Fostering economic development and job growth can be a tricky--and expensive--endeavor for governments. But fortunately they aren't saddled with doing the work alone. Local business incubators are on a mission to promote entrepreneurship and support start-ups in Memphis, and their impact is ever-growing. According to a research study conducted for the U.S. Department of Commerce Economic Development Administration
, business incubators provide communities with significantly greater results at less cost than other public works projects. Incubators are making significant contributions to local economies, and Memphis' programs are no exception.
But how are they doing this? Very simply, incubators provide process and support aimed at accelerating the development of a start-up. Depending on the kind of incubator, they may provide an array of resources, from the use of physical space and start-up capital to coaching and networking connections.
Several local business accelerator programs are opening their application processes now in the search for summertime cohorts. Start Co.'s
Seed Hatchery, Upstart and Sky High incubators, along with Memphis Bioworks’ ZeroTo510
program, are expecting their 2015 classes to be their biggest yet.
Start Co. officially began as Launch Memphis in 2008 and became a full-time endeavor in 2011. Since then the group has accelerated 37 companies. Start Co.'s Seed Hatchery
focuses on enterprise technology, Upstart
deals with women-led technology, and Sky High
targets ideas and companies involved with social innovation.
"As we started to be more inclusive of the Memphis population as far as start-ups, in particular for more minorities, more women and more students, we started to see more social ideas walk through our doors," says Andre Fowlkes, Start Co. President.
Sky High officially rolled out in 2014, assisting four new companies: Core Fire Commandos
, the College Initiative
, Care to Manage
and Fuel Film
. The College Initiative has already raised nearly $800,000 since the Start Co. Demo Day last August.
"Back in 2012, we found that really a lot of men were participating in the program overall, and women founders were a small portion of our overall demographics," explains Eric Mathews, Start Co. Founder and CEO. "So in 2013 we rolled out the first accelerator program for women-led tech start-ups."
Since then, the number of women involved with Start Co. programs has grown from only 7 percent to 37 percent.
Upstart featured four participants last year, including Cabsolutely
and eDivv, and a similar number of participants are expected this year.
"This year we are focusing more on innovation and information technology solutions," says Fowlkes, who expects four to six companies in the Sky High program this year.
"A breakout success from last year's Seed Hatchery crop includes Pickle, a competitive selfie mobile app that has accumulated 25,000 app downloads and five million votes placed on their platform," says Mathews.
Seed Hatchery, Upstart and Sky High will run simultaneously this summer, and the 100-day programs will feature workshops, product development sessions and other resources led by local Memphis business partners such as archer>malmo
, Baker Donelson
, PayPal, SendGrid, Softlayer
, Springboard and The Marston Group
Keeping the cohorts running at once is a conscious decision, aimed at building an environment that is ripe with innovative ideas and unplanned collaboration between entrepreneurs.
"We run them simultaneously with purpose from May to August because of the synergy and the creative collisions that occur when you bring diverse encounters together with differentiated perspectives. It creates higher idea velocity, and they are able to contribute and help each other in different ways. That density creates a new value-creation opportunity for all of the participants," Mathews says.
Applications are being offered through the F6S startup community--a network where thousands of founders apply to accelerators and pitch investment funds. Applications will close March 1, and companies selected will begin their entrepreneurial journeys on May 4.
With Memphis having the second-largest concentration of medical device companies in the U.S., starting the first-ever medical device accelerator in the world seemed like a no-brainer.
’ ZeroTo510 incubator specializes in helping medical device start-ups bring their products and services to market.
Now in its fourth year, the program has accelerated the creation of 16 new companies, more than 30 jobs and $7.5 million in investments.
This year's application period ends March 15, and the 12-week, mentor-driven program program will run from May until August. Up to six companies will be selected for the 2015 cohort and will receive $50,000 in initial seed capital from coinvestors Innova
and MB Venture Partners
"ZeroTo510 will run parallel with the other accelerators that will be going on in the city, so we will be doing a lot together with Start Co. and across the ecosystem to really make it a great experience for the entrepreneurs that come in during the summer," says Allan Daisley, cofounder of ZeroTo510 and director of entrepreneurship and sustainability for Memphis Bioworks.
Goals include helping medical device entrepreneurs navigate the start-up process, refine their business models and achieve the Food and Drug Administration’s 510(k) premarket notification filing.
Daisley expects to get more involvement this year from the local corporate community, including more mentorship opportunities.
At the end of the 12-week program, the participants pitch to a group of investors. The investors select finalists, who receive as much as $100,000 in additional capital and the opportunity to further develop their businesses.
"At the end of the day, we want Memphis to be on the tip of your tongue if you are an innovative entrepreneur looking to start a medical device business," Daisley says. "We're at the point now where we are receiving applications from all over the country and the world."
The attraction comes from the unique infrastructure in place to support new companies with big ideas but small limited resources. The Bioworks Business Incubator offers office space, wet labs and support equipment for biotech and clean-tech start-up companies, conference and training space, and metal prototype and fabrication facility, which can be used by medical device, clean tech, solar and other businesses.
ZeroTo510 is part of the EPIcenter
, a collaborative and community-wide strategic initiative that is helping entrepreneurs conceive, launch and scale businesses in the Memphis region.
"The EPIcenter is going to bring a number of resources that we didn't have previously, especially when it comes to assistance from the corporate community and the ability to line our entrepreneurs up with potential investors, customers and test beds for their products. So we are really looking forward to that relationship," explains Daisley. "It is going to help our entrepreneurs get further faster."