By Tom Ballard, Chief Alliance Officer, PYA
In a first-ever opportunity for a Knoxville-based start-up accelerator, every company going through the Knoxville Entrepreneur Center’s (KEC) “The Works” program this year has received some seed investment.
The eight teams – four focused on media content and four focused on coding – are about midway through the intense program that culminates with a combined “Demo Day” on September 20 during “Innov865 Week.”
As previously announced, Scripps Networks Interactive was taking an equity interest in the four teams comprising the media/content track, and Angel Capital Group (ACG) was leading an effort to raise a dedicated fund for the four coding start-ups.
Thanks to 11 investors including yours truly, the ACCELER865 Fund has made an investment in the coding teams that wanted and needed the seed capital.
“We did fund the 2016 coding cohort alongside Scripps,” Eric Dobson, Chief Executive Officer (CEO) of ACG, says, quickly underscoring the word “we” and giving the credit to a number of individuals. “We simply provided the vehicle (ACG) for the investors.”
Dobson says the impetus for the initiative started with a call from Roger Kiger in January. The Chief Manager and Wealth Strategist at Visionary Horizons Wealth Management is also a key player in Knoxville’s Lighthouse Fund.
“Roger wanted to talk about what we could do to bolster the mission of KEC,” Dobson says. “He encouraged ACG to launch the fund, and he agreed to write the first check.”
As the old saying goes, the first money is the hardest to raise. Once the first check was written, others came on board.
“It is in many respects like 3D printing,” Dobson observes in drawing an analogy between adding other investors to build the fund and printing layers on top of layers to create a new object using the additive manufacturing process.
ACG’s CEO also gives credit to Jim Biggs, KEC’s Executive Director, and his team for building the type of program that attracts strong entrepreneurs with fundable ideas.
“These are some of the strongest companies we’ve seen compared to previous accelerator programs,” Dobson said.
For KEC, the funding for start-ups in “The Works,” regardless of the source of funding, adds a new recruitment tool.
“We’re very excited for the ongoing support of our investor community and particularly grateful to Eric and Roger and the folks at ACG for their efforts to build the Acceler865 Fund this summer,” Biggs said. “The seed capital they’re investing will provide a great foundation for the entrepreneurs coming through ‘The Works’ accelerator, and we look forward to expanding the opportunity for additional funding in future programs.”
Those who follow the accelerator movement across the country know the most successful ones provide a financial incentive to attract the entrepreneurs to their programs that run about three months on average. That initial investment allows the entrepreneur to focus full-time on the business opportunity during the program, with the expectation that they will be in a position to raise additional capital upon completion. It also is an economic development tool – attract start-ups from elsewhere to test drive your city in the hope that they will stay or encourage local entrepreneurs to immerse themselves in advancing their ideas.
As far as the future, Dobson says, “I expect this to be an annual effort, so the community should be ready for another call in the spring of 2017.”