If you received the newsletter from Velocity announcing that managing director Tony Schy was stepping down, you’ll know that the post asked a few interesting questions about what the community wants the Velocity of the future to be.
This is real. The stakeholders involved with Velocity really want to know.
This week, Insider Louisville sat down with entrepreneurial mentor Greg Langdon; Velocity director of operations Jacy Cruz; executive director of the Blue Sky Network, Bryce Butler; and Kent Lanum, president and CEO of the Ogle Foundation to talk about the accelerator program and Velocity in general.
In light of Schy’s departure from Velocity, Blue Sky Network and the Ogle Foundation — specifically Butler and Lanum — have decided this is a good time to open the Velocity accelerator program up to some circumspection and community input.
Blue Sky and Ogle made a three year commitment to fund the program; it is now entering year three.
What’s working? What’s not working? What’s worth keeping around, and what’s worth sunsetting?
Velocity has developed into a number of components.
The MakerMobile program is being run by Madison Hamman, project manager for Blue Sky, and just hired one full-time and one part-time employee. The program is a partnership between Velocity and Tech Shop in San Francisco. It brings a 32-foot trailer of maker tools and machines to schools and events. It was previously run by volunteers.
Mark Lorence runs the Velocity Kids coding and hardware education program that Butler called a “surprising success” and Lanum said was an “afterthought.” More than 250 children have been through the classes. Cruz said programs typically fill up within 12 hours of posting.
The co-working space currently has 70 members.
But by far the “largest nut” funding-wise is the accelerator. Aside from operational costs, each class requires more than $100,000 just to fulfill the funding commitment to each company.
“Tony’s huge success was bringing mentors out of the woodwork,” said Butler.
At first the accelerator program attracted mostly companies from out of town, but this most recent cohort is entirely regional. “It was fun to expose different companies to the area,” said Langdon.
There has been no decline in applications for the accelerator program, Lanum said, but local companies have taken more notice lately.
But here’s the thing: Lanum and Butler acknowledge that it shouldn’t be the responsibility of two organizations to fund this entity, if the community decides the accelerator program should go forward. “The private and corporate sectors need to step up more,” said Butler, adding that local private and corporate entities tend to wait for the city or state to take action.
“Did we plug a gap?” asked Langdon. “Has that gap been filled enough that Velocity can cease to exist?”
While we’re apt to see some success stories come out of Velocity in the longterm, Langdon said, the “failure rate is surprisingly high” with companies in the early stages.
But was accelerating these companies to success the sole outcome the stakeholders wanted to see from the accelerator? Absolutely not. Langdon said the focus was always on the people and not the companies, and a critical goal was “creating good entrepreneurs.”
This is why working with accelerators should be a no-brainer for corporations. “Not all the companies will survive,” said Butler. “This might be a way to align yourself with talent.” It may sound ruthless, but when a company fails, the corporations are ripe to scoop up these suddenly unemployed entrepreneurs who have been through a rigorous program.
Butler believes Velocity’s greatest success is that they “helped drive the conversation about startups in the community.” As is typical when any conversation about startups happens in Louisville, Butler cites the “Brad Feld Event” in November 2012 as being the “The Moment” or “The Catalyst” for the community. And you probably would be a fool not to. Heck, when Insider covered the event, this was the story’s lede:
It’s possible that we’ll look back on Brad Feld’s visit to Louisville and realize it was the starting point for a dozen important, transformative conversations that are long overdue.
Talk had already started about an accelerator program, but that was one of the first times the startup community began to collectively think about the community. Since then, pieces of the startup community have been falling into place. But it’s not about checking things off the list, said Lanum. Just because you have an accelerator doesn’t mean you’re “done.”
“We need more of these things,” he said. Cincinnati, for example, has multiple angel investment funds — Louisville just has one. And, said Butler, our angel investors are pretty inactive.
The future of Velocity may very well depend on who wants to succeed Tony Schy. “Who’s that point person who’s going to show up every day? Would the right entrepreneur be interested and excited?” asked Butler. That person would take the third year’s worth of funding to keep the programs running but also would have to raise money for the fourth year and beyond.
Velocity’s lease on the building at 400 Missouri Ave. in Jeffersonville runs through April 2016.