Founder Labs Brings Its Silicon Valley Flair for Fostering Startups to Manhattan

5/16/11Follow @jpruth

Picking the right team can make all the difference when launching a new venture. Starting on May 21, a group of some 16 designers, engineers, and marketing professionals will gather to form teams aimed at creating startups. Founder Labs, a five week “pre-incubator” program targeting concepts for the mobile sector, is ready for its Manhattan debut.

Shaherose Charania, CEO of Founder Labs and Women 2.0, said her program was created to help teams come together and validate their ideas prior to formally launching startups. While accelerator programs such as TechStars offer existing startups seed funding and the opportunity to pitch to potential investors, Founder Labs brings together individuals who may not have completely formed their ideas yet but are eager to explore entrepreneurship.

Charania said she taps her connections with incubators, accelerators, and seed funds such as TechStars, 500 Startups, and i/o Ventures to refer in the teams from Founder Labs that show potential. The Founder Labs program, started last August in San Francisco, has run three times—twice in San Francisco and once in Menlo Park—helping would-be entrepreneurs find others with the skills and desire to bring new ideas to market.

For example, Spoondate, a company born from last October’s session of Founder Labs, is expected to launch this spring. Spoondate is a dating website for foodies with shared tastes. Charania said the company was accepted in February into the incubator program run by angel fund 500 Startups, which includes seed funding and access to investors.

Founder Labs NYC is the fourth iteration of Charania’s program and its first appearance outside of California. Charania said the 16 participants at Founder Labs NYC, chosen from more than 150 applicants, will meet in the evening Monday through Friday during the coming weeks and on some weekends. In addition to collaborating with each other, participants will present their ideas to investors and veterans of the startup community such as James Robinson, managing partner with RRE Ventures, and Winifred Mitchell Baker, chairman of the Mozilla Foundation.

San Francisco-based Founder Labs is an offshoot of Women 2.0, a venture that encourages women in the technology sector to start their own companies. Charania said Founder Labs picks a 50–50 split of men and women to participate.

Charania, an émigré from Canada, knows a little something about starting from scratch. After she earned her bachelor’s in business administration from the University of Western Ontario and spent one year abroad in Spain, she moved to the U.S. in 2005 with no money, no job, and no idea what she wanted to do. Charania said she relocated to Silicon Valley, driven by a passion for technology. “I’ve worked with pre-idea startups, funded startups, and worked at a post-acquisition company,” she said. Charania previously worked as director of product management and marketing at Jajah, a communications startup which was acquired in 2009 by Telefonica, and was director of product management at Talenthouse, a social media platform for the creative community. She is currently with Opinno, an incubator network that offers programs for growth and consulting services to early-stage companies.

Charania said she decided to bring Founder Labs to New York City after a conversation in January with Fred Wilson, a partner with Union Square Ventures, who cited the need for the program. Charania said Janet Hanson, CEO of 85 Broads, a network of standout women, also called her attention to the community of former Wall Streeters that includes young women looking to explore entrepreneurship and more experienced women exploring angel investing.

RRE’s Robinson called Founder Labs “practical, hands-on instruction” for those who are new to the complexities of starting a business.

Charania said entrepreneurship may not be in everyone’s blood at the onset, but Founder Labs helps them develop the connections necessary to get started. “We bring together really smart people that we handpicked, help them build their teams, and validate their ideas,” she said. If two or more team members from Founder Labs start a new company together within one year of completing the program, Founder Labs takes a two percent stake in founders stock.

Though Charania is particularly interested in seeing startups in the mobile market, making a run-of-the-mill app is not enough for acceptance into Founder Labs. She wants to see ideas that address real-world problems through mobile devices. “If you are coming in with a social gaming idea, just get the hell out of here,” Charania said. “There are so many parts of the mobile space that need work.”

Such areas include analytics tools for mobile ad networks, health solutions, and mobile security. Charania said she does not expect Founder Labs participants to conquer all the big ideas, but she encourages the growth of smaller ideas to address real-world issues.

The New York City investing ecosystem is evolving, Charania said, along with entrepreneurship. “We saw an opportunity to bring together teams so that investors looking to invest in early stage can see what is happening from our side,” she said.

Founder Labs is aimed at helping entrepreneurs launch prototypes by the end of the program, similar to TechStars but at an earlier stage. Charania said the participants will divide into four teams that will each consist of two engineers, one designer, and one marketing professional.

A diverse mix of experience was sought, she said, among the candidates. She chose engineers with an average of five years experience—with startups or large technology firms—who also developed side projects to demonstrate their entrepreneurial spirit.

Among designers, Charania said she looked for raw talent and a desire to start a company. For the business and marketing role, she sought professionals with at least five years of experience as well as leadership skills. “Have expertise in something you are passionate about,” she said. “We’re looking for action-oriented folks who are out there to make a name for themselves.”

The program starts with participants getting to know each other. During the first week, the participants work on small projects together, coming up with quick ideas. “We call them rapid prototyping tests,” Charania said. The concept is similar to Startup Weekend, though Founder Labs participants have one week to court potential team members and coalesce their ideas.

The subsequent weeks will include customer development tests where the teams communicate with 50 to 100 customers to sharpen their ideas. Each Tuesday night will include one-on-one team mentoring. On Wednesday nights, teams will make presentations based on feedback from customers about the product. Charania said a one-hour lesson from a Silicon Valley mentor on such topics as lead marketing and early stage funding will follow those presentations.

The program will end with a Final Demo Night on June 29, where the teams show off what they developed. “The real magic happens after,” Charania said. “At the beginning, you don’t know if this is the team you want to work with or if the idea is going to work out. By the end of it, you have some sense of that.” The teams can choose to part ways and stick with their day jobs, or pursue their ideas and apply to an incubator such as 500 Startups.

Charania said Founder Labs will serve as formal advisors to the teams that show the most promise. “We get them in front of investors, grow their teams, and give them feedback on their products,” she said.

João-Pierre S. Ruth is the editor of Xconomy New York. He can be reached at jpruth@xconomy.com and followed on Twitter @jpruth. Follow @jpruth

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