A big step forward today for TechStars, the Boulder-based uber-accelerator founded in 2006 that has set up operations mentoring and funding startups in six cities across the U.S. and powering several more. The company today is opening TechStars London — the first TechStars outpost outside of the U.S. In doing so, it is also announcing a merger with Springboard, a UK-based accelerator founded in 2009 and modelled on TechStars.
Startups interested in applying can come from anywhere, not just Europe, but must physically come to London for the three-month program. Funding is $118,000 (€80,000). That’s the initial $18,000 plus the $100,000 convertible note that all TechStars companies get. The first program will start in July 2013, but the application deadline for this has yet to be announced.
David Cohen, the CEO and founder of TechStars, tells TechCrunch that TechStars is taking over all of Springboard’s operations — which include accelerators focused on web, mobile and Internet of Things technology.
“Springboard will no longer operate after the upcoming IOT program,” he says. “[Head] Jon Bradford will focus on TechStars exclusively starting with the first TechStars London program in July.” Bradford’s role will be that of managing director. Cohen will also spend all of July here, and says that Brad Feld (TechStars co-founder) and Andy Sack (another MD) “and other MDs will spend time in London during the first program helping launch TechStars here.” Springboard has now also made the news official on its own site.
The move signals of a couple of things. It’s another sign of how European startups — and cities like London — are gaining a bigger international profile. This feeds into the ongoing debate of how successful the tech community has been at creating hubs (intentionally or organically) for technology innovation and entrepreneurship outside of Silicon Valley, and where those hubs might be.
It’s also a sign of how early-stage funding for startups continues to get a lot of attention and investment — perhaps, some believe, to the detriment of many of those companies able to secure funding at later stages. (And whether Europe is feeling much of that heat itself.)
Given that other cities like Berlin, Barcelona, Copenhagen, Stockholm and others also have laid claim to being important startup hubs in Europe, why the decision to move to London?
“I’ve visited London many times over the last four years,” Cohen says. “Something feels different now. The energy of the startups and the problems they’re solving here is strong. I see mentors working together to help the next generation of startups. All of the signs that the startup community here is starting to come together are present. And for TechStars, the timing works as we open our first non US location. We are ready also.”
He says that TechStars did consider other places — which may point to more expansion in Europe in future if this goes well.
Cohen adds that the list of mentors will include Michael Acton Smith (of Moshi Monsters/Mind Candy fame), Russell Buckley (former European head of Google’s Admob), Brad Feld, Eben Upton from Raspberry Pi, and more. “Each of our U.S. locations are different, too. Every geography has its own strengths and weaknesses,” he adds. “We aim to have 80%+ of our mentors come from London, so they can work closely and hands on with our companies here and really go deep.”
TechStars has come to London also by way of a large lobbying effort from the UK government as well as organisations like Tech City — the government-funded advocacy program designed to promote London and the UK as tech centers — which is now led by Joanna Shields, the well-connected tech veteran who has had senior roles at Google, AOL/Bebo, and most recently Facebook, where she headed up the social networks EMEA operations until late last year when she took the Tech City role.
That is not support in the financial sense, however. “We have not asked for it nor explored it yet,” says Cohen. “However, both have been tremendously supportive.” Today, TechStars is launching publicly today at No 10. “Joanna will be there and is very in the loop,” he says.
This may be TechStars’ first move to international waters, but this is not the first time that the mountain and Mohamed have met: TechStars has already backed and worked with European teams including Memrise in the UK, GrabCAD from Estonia and docTrackr in France. TechStars says that cumulatively these international startups have raised €16m of investment funds.
Of the 163 companies that have passed through TechStars accelerators, 17 have been acquired, 19 have failed, and they have on average each raised just under $1.5 million, TechStars notes. Overall the program has seen nearly $289 million raised for the 163 companies.
Other recent moves of U.S. companies focussed on startups to London including the opening of General Assembly last year. That’s aside from the many tech companies themselves that have set up shop in the city, from biggies like Amazon and Google building out and investing in huge spaces to companies like Box and Uber setting up stalls to grow their European footprints.
Full release below.
Launch of TechStars London Offers Big Break for UK Start-Ups and Investors
TechStars, one of the world’s most successful accelerators, opens its doors in the UK
20 February 2013 – The world renowned start-up accelerator TechStars is to launch a programme in London, its first outside the US, the entrepreneurs behind the venture fund announced today.
In a meeting at No 10, TechStars CEO David Cohen and General Partner Mark Solon confirmed TechStars are expanding their network outside of the US by merging with Springboard, co-founded by Jon Bradford, to launch in London the globally renowned TechStars mentorship-driven investment programme.
Launching in March, TechStars London is expected to support up to 20 start-ups annually across the UK, Europe and further afield through an investment of €85,000, being €15,000 of seed funding and an optional €70,000 convertible debt note for each company.
TechStars already have a strong track record working with European teams, with their alumni including Memrise (UK), GrabCAD (Estonian) and docTrackr (France) who have cumulatively raised €16m of investment funds.
The move comes just two years after Tech City Investment Organisation was set up by the Coalition Government to help attract inward investment and make London the digital capital of Europe. It also highlights the continued benefits of the introduction of policies designed to make the UK the first choice for entrepreneurs and investors, including tax relief for the creative sector and Entrepreneur Visas.
David Cohen, CEO and founder of TechStars, said: “We’ve had our eye on the burgeoning London tech scene for some time, well aware the US doesn’t have a monopoly on either tech skills or entrepreneurship. The current business climate here means we can work with an incredibly broad spectrum of British and international teams and top talent. Merging with Springboard will allow TechStars to deliver great results both for start-ups and investors.”
Jon Bradford, CEO and co-founder of Springboard, said: “Coming together with TechStars makes perfect sense. Springboard and TechStars have long had a natural affinity, not least because of our shared mentor-led approach. Bringing their expertise to London can only be good news for tech start-ups in the UK, Europe and beyond.”
Ed Cooke, CEO and co-founder of Memrise, said: “I’m thrilled at the launch of TechStars London. Not a week goes by when the exceptional TechStars mentor and alumni network does not materially aid us. This network, its generosity and sense of community, is a wonderful addition to London’s already dynamic start-up scene, and stands to benefit every entrepreneur and investor.”
Joanna Shields, CEO of Tech City Investment Organisation and UK Business Ambassador said: “Today’s announcement shows Tech City is fulfilling its potential as one of the world’s great technology centres. With such an ambitious package of policies, incentives and visa support, the UK is amongst the best places in the world to start and grow a business. Together with global accelerators like TechStars, we really are paving the way for high growth British businesses to succeed and have a real impact on the global stage.”
The Minister for Culture, Communications and Creative Industries, Ed Vaizey MP, said: “I am very pleased that TechStars has chosen to establish in London. We are putting in place the policies to help companies grow and help them get access to the finance they need. TechStars is an important addition to the sources of funding for companies.
“The UK’s technology sector is full of creative, skilled, people setting up, and working in companies that can grow quickly and be the equal of any other in the world.”
Applications for TechStars London open on 16 March 2013 to compete for one of ten places on the programme. To apply for a place on TechStars London visit www.techstars.com