Timothy Baynes told the News Leader on Friday that when most people think of the “startup ecosystem” of tech companies, they associate sources of initial investment with places like Boston and Silicon Valley.
But Baynes, CEO of a Springfield-based startup dedicated to optimizing the online shopping experience by “intelligent recommendation”, said heart-minded entrepreneurs with a winning idea don’t have to venture so far in search of seed capital.
Baynes-based company, Compatio, was among hundreds of applicants vying for one of five positions in Missouri State University’s 2019 eFactory Accelerator program, the most recent year eFactory led the program. The accelerator took a hiatus in pandemic year 2020, but is returning for 2021.
The university announced this week that the application window for companies to join the program’s fifth class of startups, dubbed “Cohort 5,” is open from May 1 to midnight on May 31.
What do startups get if they are chosen?
The Accelerator isn’t just a chance to get mentoring advice from a dedicated consultant and refine business plans (and refine them again), it’s business. The companies selected for the fifth class of Accelerator startups each receive a $ 30,000 investment in exchange for an 8% stake in the company.
Money for the seed capital fund comes from a variety of sources, according to an eFactory press release on the performance of the accelerator. These include the Missouri State University Foundation, Missouri Technology Corporation, Rural Missouri Inc., Springfield Business Development Corporation, BancorpSouth, Central Bank, Great Southern Bank, US Bank and of Wood & Huston Bank. A total of 17 companies are now part of the Accelerator investment portfolio.
For Baynes, “Money has helped, in the first place, because every startup needs cash. So right out the door it helps.”
Compatio has been so successful that it has raised more than $ 2 million in private investment since joining Cohort 4, the eFactory said this week.
“This accelerator has allowed us to connect to the network of investors, angel investors, who are around the Springfield area,” Baynes said. “There are more of them than you might think.”
While Compatio was looking for “pre-seed” funding, they were able to raise $ 900,000 through the local network of angel investors alone, Baynes said.
Baynes, a software expert whose 30-year career took him through well-known companies like Oracle and KPMG before starting his own business, said: “There has been a big push in the past two or three years. to get investors to focus on the Midwest. There’s a lot of cutting edge technology here … there’s a lot of investors here, so you don’t have to move to Silicon Valley to get your financing. company. You can get it here. “
He added that the companies and business founders that gain places in the accelerator tend to come from a wide range of backgrounds with various types of business plans.
“Very, very precious experience”
Besides funding, the Cohort 5 program includes 18 weeks of programming and support, eFactory said this week. Baynes recalled 12 to 13 weeks “full of information and exercises”: accountants shared tips on setting up financial records, lawyers gave advice on patents and intellectual property law . Real estate planners offered expertise on the best ways startup founders should position themselves as business owners to protect their investments. Others provided help to “understand sales methodologies”.
“A very, very valuable experience,” Baynes said of his time in Cohort 4. His business is now poised to grow as the pandemic effect included a major shift to online shopping even as metrics of the economy as a whole has been looking pretty good in recent months: The Commerce Department pointed to 6.4% growth in U.S. gross domestic product in early 2021, USA TODAY reported this week.
New this year, Accelerator content and programming will be delivered in multiple formats so founders can stay focused on growing their business, the eFactory said this week.
“The strategic changes and investments we have made over the past year will allow us to deploy resources and support to certain businesses in ways that we have never been able to do before,” said Rachel Anderson, director of eFactory, to News-Leader in a prepared press release. “The on-demand content combined with in-person and virtual activity will be a real game-changer for the companies selected to participate in Cohort 5.”
The accelerator begins July 19, 2021. The demo day, when companies present their ideas and achievements, is scheduled for the week of November 15, 2021. Participants will receive an additional six weeks of workspace at the eFactory and resources after the demo day through the rest of 2021, according to a press release.
The application process begins at efactory.missouristate.edu/accelerator, the eFactory said this week.
Baynes said the kind of person who succeeds with the eFactory Accelerator is one who shows persistence and vision.
“You have to have tremendous confidence in your vision,” said Baynes, “because it’s difficult, and you will be disappointed. You will suffer setbacks, and you have to have confidence in yourself and what you are doing to keep going, no matter what happens. “
The willingness to adapt to change and to be able to look at the business – and yourself – with clear eyes and “rigorous self-honesty” is a must, Baynes said.
Contact News-Leader reporter Gregory Holman by sending an email to email@example.com. Please consider subscribing to support vital local journalism.