TAKING OUR COMPANY THROUGH AN IOT ACCELERATOR PROGRAM
By Steve Dunn May 2020 (extract from the book 'Startup Accelerators' (2020) published by Wiley)
Accelerators are fixed-term, cohort-based programs, that include mentorship and educational components and culminate in a public pitch event or demo day. Looking to accelerate its evolution, Digital Keys was exploring different accelerators and came across the H - Farm Deutsche Bank IoT Accelerator. Given the accelerator’s niche focus on IoT startups, the fact that Digital Keys had recently received a funding grant from the European Commission, the fact that Digital Keys had recently signed a partnership with Vodafone Spain to support the delivery of Digital Keys product in the European market, Digital Keys chose to apply for the H-Farm Deutsche Bank IoT Accelerator in Italy.
The accelerator was to be held at an innovation hub called “H - Farm”, which was in a farming and winery district on the outskirts of Venice. A farming and winery district in Venice was far removed from Digital Keys current location adjacent the sandy, sunny beaches of the Gold Coast in Australia. Still, the startup had been gaining traction for its product offering with many potential customers across Europe and was working in partnership with SAG, a German lock manufacturing company.
So, it was looking to relocate from Australia to Europe to be close to its partners and customers there. Also, relocating to Europe made flights from Europe to the USA and Asia, where Digital Keys other customers and manufacturing partners were, much quicker and less expensive relative to from Australia. Digital Keys had in fact been considering and actively seeking out European accelerators on the application website www.f6s.com for a couple of months prior to applying for and being accepted into the H-Farm IoT accelerator. Digital Keys had submitted 4 applications to European accelerators at f6s.com within a few weeks. It had received interviews for two of them and was finally offered a place in the H-Farm IoT accelerator. Digital Keys saw the IoT accelerator located in Venice, close to an international airport, with most flights to all of Europe being only one to two hours away and less than 100 Euros, as the perfect launching ground for its new European strategy. Before applying to the accelerator, Digital Keys had read journal articles discussing H-Farm alumni who had relocated to the shared office spaces on site after the program had finished. Also, some alumni were offered nearby affordable accommodation owned by H-Farm. Digital Keys was attracted by this possibility, and the fact that many H-Farm accelerator alumni had raised investment capital, and for some international startup co- founders, H-Farm had sponsored Italian permanent living VISA’s.
The Deutsche Bank IoT accelerator was held in conjunction with a Food accelerator sponsored by CISCO with five startups participating in each of the programs. Steve found the running of two completely different themed accelerators, with two different groups of contrasting startup teams, in the same space was an unusual approach. He was surprised to learn that H-Farm commonly delivers its accelerators this way, and that this is a formula that seems to have worked for them over the last ten years. Thus, the two accelerator programs started at the same time, and shared the same curriculum, the same mentors and coaches, the same co-lab working spaces, and the same scheduling. Each program had two program managers specific to it.
The IoT program started in early November. The first part of the program involved intense mentoring sessions with up to four different mentors each week over six weeks and preparing for a networking event in week two with the program sponsors. The accelerator then had a break for two weeks over Christmas and New Year. Since H-Farm closed over this period, most people returned to their homes to celebrate the festive season. Steve got on a flight back to Australia to spend Christmas with his wife and two kids.
The other cofounder participating in this accelerator with him remained in Europe over that period. Steve flew back from Australia to Italy when the program reconvened in the New Year. There was a new focus on getting the PowerPoint presentations, business plans, 5-year financial projections, and pitch presentations ready. The mentoring schedules were not as intense as the first six weeks of the program. Instead of two to four mentors coming in each week in the first six weeks, now only one mentor would come in on a weekly basis in the second half of the program.
The second part of the program was also far less structured, with many teams travelling all over Europe at different times to meet with interested customers, partners or investors. During this part of the program, the co-working space was only half full. The teams were often left to themselves most of the week in the co-working space to work on getting traction, on the PowerPoint presentations for demo day, on the business plan, on the financial projections or on preparing the pitch for demo day.
The Accelerator program managers would come around every couple of hours, to have a look at the progress of these activities to offer advice and of course correct those going down the wrong path. In Steve’s opinion, one of the most valuable sessions of the IoT accelerator was the “Intro to capital markets presentation” delivered over three hours by an experienced Corporate Investment banker. The presentation discussed in detail issues such as how to develop an effective story for fundraising, how to approach the investment community, ideal funding and growth roadmaps, go to market strategies in the context of fundraising, types of investors to target and the funding market landscape. Steve found the session extremely valuable, not necessarily for learning any new groundbreaking content, but getting the nuances and distinctions from an Investment banker with over 30 years’ experience investing in startup and companies around the world on behalf of Deutsche Bank. This was the type of learning he could not have derived from a textbook.
Read More in Startup Accelerators; A Field Guide available in book stores and on Amazon here