Thursday, July 2, 2009

Fast pace, less funding define TechStars

By Galen Moore

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At 9:45 a.m. on a rainy Monday, no one at TechStars answered the doorbell. I had been warned of late starts at the Cambridge branch of this startup incubator and assumed I was the first to get there to witness a day in the life of the three-month program.

It turns out, I wasn’t: At least three entrepreneurs were inside, heads down, ignoring the doorbell — which is loud and plays “The Star Spangled Banner.”

Apparently, when deadlines loom, these entrepreneurs don’t get up — even for the national anthem.

“It’s like a year or two of company life in three months,” said Mike Monaghan, whose company, TempMine, is building an online temporary staffing marketplace. Heads down, founders tilt at business obstacles — crashing through walls, as Monaghan put it — until one of the program’s mentors or advisers points out an easier way. “They can say, ‘Whoa. There’s a door two feet over. Here.’”

Founded in Boulder, Colo., three years ago, TechStars expanded to Cambridge this year with nine companies in its new East Coast program. In exchange for a 5 percent equity stake, each startup gets office space, up to $18,000 and access to a list of the region’s entrepreneurs and investors who have agreed to be mentors.

Many of the companies here haven’t yet put out a product — or even settled on a business plan. Several founders said the advice of TechStars mentors has brought their company around to an entirely new direction.
Alex Moore and Stephen Lee are former Analog Devices engineers working on the next release of their nascent e-mail analytics application, now out in its second iteration to a closed community of alpha testers.

Their company’s evolution has quickly outpaced what they had imagined, Moore said. “Originally, our plan was just to have two releases this summer,” he said. “Now we’re going to have four or five.”

There are no office hours at Techstars. LangoLAB  founder Jennifer Ede started her day at 8 a.m., meeting an adviser in the nearby 1369 coffee shop to discuss intellectual property strategy. Her startup, one of two Chicago transplants to join the TechStars program, provides an online application for language learners to share, use and write captions for foreign-language videos. At 10, she’s in sock feet, preparing for another adviser meeting. “9 to 11 is typical,” she said. “And I don’t mean two hours.”

Inside three large rooms of the TechStars space — barely altered from its prior use as a classroom complex by Kaplan, the standardized test preparatory company — the nine local companies have taken up space at desks made of folding tables. Alliances form across the loosely defined space that constitutes each company’s office. TempMine’s Monaghan sought out Localytics’ Raj Aggarwal and AccelGolf’s William Sulinski as kindred spirits: All three are the business-minded founders in their respective startups.

At HaveMyShift , both founders seem to enjoy the hacker model of entrepreneurship. Stephen Wooten and Sean Corbett arrive at about 3 p.m., laptops under their arms and large take-out cups of coffee in their hands. After a few minutes, the two went straight to one of the facility’s conference rooms and shut the door to hash out their plans for the workday, starting now. They’ll work until about 4 a.m., writing code for their online employee shift-trading site.

By 3:30 p.m., all three conference rooms are occupied, as TechStars participants take advantage of the overlap between the schedules of technology-minded founders and business-minded founders.

LangoLab and HaveMyShift are the only two companies with no New England connection. (AccelGolf hails from Maine.) That both are from Chicago is a fluke, said executive director Shawn Broderick. Of the 270 applications TechStars received for the Cambridge program, about half were from Massachusetts, he said. By the end of the program, ideally they all will be from here. “In a perfect world, I want a company from Chicago and a company from Maine to stay in Boston,” Broderick said.
 

The TechStars lineup