OpenIncubate to Boost Open-Source Startups in Austin, Boston, and SF

[Updated at 2:06 p.m.] Austin, TX, will be one home to a new incubator designed to promote innovation in open-source technology.

OpenIncubate is a joint project by Austin Ventures, Battery Ventures in Boston, and The Valley Fund, located in Menlo Park, CA. The firms hope to boost open-source startups in each region with mentoring and seed funding.

“This provides a level of openness and community dialogue and an ability for entrepreneurs to innovate in a way that has not been there in the close-sourced environment or in hardware domain,” Alex Benik, a principal at Battery Ventures, said in an interview on Friday. “We suspect that we’re going to find some interesting deals that we may not have otherwise found.”

OpenIncubate’s mission is to tap into a new wave of entrepreneurs and build them into robust players in the open-source space. “This is a massive trend that is going to have significant impact on the $50-billion server market, on the $10-billion data center switching market,” he says. “That’s why people are excited about this.”

OpenIncubate is looking for startups or entrepreneur teams that are focused on software or software-as-a-service projects. The program is open to teams throughout the world, but they would be required to move to one of the three hubs. The incubator, which will be housed at Capital Factory in Austin, Battery’s Boston office, and The Valley’s office in Menlo Park, will provide free workspace and mentoring.

Benik says they hope to deploy money to the first company in a couple of months. The program was announced on Thursday, and he says they are already hearing from startups interested in joining the incubator.

[Updated with comments from Austin Ventures.] The incubator will help organize existing communities like the Ruby/RoR development ecosystem, the Python ecosystem, and others in Austin, says Chris Pacitti, a general partner at Austin Ventures. “It validates the city as an IT leader alongside traditional hubs in Boston and Silicon Valley,” he says. “It also validates Austin’s longstanding strengths in building companies with business model sustainability from day 1, and its relative strengths in delivering IT solutions for the enterprise customer.”

OpenIncubate came together after the principals at the three firms, who have long worked together, each seized on open-source innovation as a key opportunity in technology, Benik says.

Having attended a hackathon recently sponsored by the Open Compute Foundation, Benik says he was struck by the quality of the ideas that were being pitched. “It really clicked in my mind that this was something worthwhile to do,” he added.

Shion Deysarkar, an Xconomist and founder and CEO of Austin startup Datafiniti, says he believes OpenIncubate will help to make Austin a hub in the open-source market. “It’s a market that will clearly grow, so it’s great that this program will act as a magnet to bring in talent and money to Austin.”

He’s curious to see, however, how new startups can figure out how to commercialize open-source core concepts while also maintaining its fundamental goals of openness, ease of use, and low costs.

“A lot of the commercial solutions seem to suffer from the same bloat that most enterprise products suffer from, resulting in overly-complex and costly solutions,” he says. “I would love to see a local company solve this.”

Angela Shah is the editor of Xconomy Texas. She can be reached at or (214) 793-5763. Follow @angelashah

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