Business incubator secures accelerator program investment

The eFactory secured a lead investment in a new capital seed fund toward the creation of a business accelerator program at the downtown Springfield entrepreneurship center and business incubator.

“This is the next step in creating an entrepreneurial ecosystem,” said eFactory Director Brian Kincaid.

“We have a good basis now from which to grow the program.”

The $150,000 investment was presented April 16 by RMI Inc., a Jefferson City-based administrator of Small Business Administration 504 loans. During the check presentation, Missouri State University President Clif Smart said the school’s foundation will contribute $150,000 in matching funds toward the program, which has an overall $600,000 goal.

“The key to economic development is job creation, and somewhere business has to start,” RMI CEO Ken Lueckenotte said. “The eFactory (is) a good place to put some money into to invest in these startup businesses and hopefully will go on to create many jobs.”

While an inaugural class and start date have not been determined, Kincaid said fundraising is ongoing to build a larger seed capital fund for more potential startups.

“We don’t have a large number of mechanisms in place to facilitate seed capital or early stage capital,” Kincaid said of an identified gap two years into the Missouri State University program. “That was an area we wanted to focus on to get people from an early stage idea through the viable product or proof of concepts, then get to a place where they are an investable company or have enough market penetration to grow off of revenue.”

The 12-week accelerator program is designed to provide an unspecified number of companies with $30,000 in seed funding, mentorship and office space, as well as networking and follow-on funding opportunities. A yet-to-be formed investment committee made up of community and business leaders and seed fund organizers would select companies through a competitive application process.

“We want companies that have the most opportunity for growth and success,” Kincaid said.

“We anticipate a large number of applicants, and we want to ensure that we’re choosing the best ones with the most responsible use of the funds. I think that there will be a lot of overlap on the types of companies that we see applying.”

In forming the program, The eFactory has taken some cues from other accelerator programs around the nation that resident business leaders have taken part in, including Capital Innovators Tech Accelerator in St. Louis and Entrepreneurs Roundtable Accelerator in New York City.

Among the 10 current companies in NYC’s accelerator is Alumni Spaces, which was co-founded by eFactory Entrepreneurial Specialist Rachel Anderson. Companies in ERA receive an initial investment of $40,000.

Capital Innovators provides startups with $50,000 in funding, and since its inception in 2010, it has 47 portfolio companies. One of those is Springfield entrepreneur Josh Holstein’s business, CellARide LLC.

“Going in helped me streamline my approach and structure the company,” Holstein said. “I couldn’t do that by myself.”

Part of tailoring the program to the Springfield market is finding mentors with the experience and knowledge base to coach the new entrepreneurs.

“We’re actively recruiting mentors who have a skill set that we believe to be applicable, but then also that (are) positioned to where they really want to be helpful to the startup entrepreneurial community,” Kincaid said. “We have started that process.”[[In-content Ad]]