Latest Techstars Cloud Startup Class Presents Today in San Antonio
San Antonio — For 11 early stage businesses in San Antonio, TX, three months of planning, trepidation, and retooling business plans is coming to a head. The participants of the Techstars Cloud accelerator program are holding their Demo Day today in the Alamo City.
Techstars is the Boulder, CO-based mentorship accelerator that offers versions of its program in more than 20 cities around the world. In many ways, Techstars Cloud in San Antonio is unique among all of them because of its structure and history.
While any Techstars program typically has a tech focus, that’s particularly emphasized in San Antonio, where the cloud program picks companies that are developing some sort of cloud infrastructure tool or a product meant to support or enhance the consumption of cloud infrastructure, according to Blake Yeager, Techstars managing director for the San Antonio accelerator.
“Big data analytics-type products tend to be a really good fit,” Yeager says. “If you’re building a really technical product, the cloud program is probably a good fit for you.”
The 11 companies will be delivering short pitches to a room of potential investors, business partners, and consumers for the first time publicly during the Demo Day. The group of startups was selected in November, and includes three companies from outside the U.S., three from Austin, TX, and two from San Antonio. (A full list is available here.)
Startups selected to participate in the program get $20,000, among the other advisory benefits, in exchange for a 6 percent equity stake. That amount has increased from $18,000 previously. They are also offered a $100,000 convertible note, which converts into a equity during based on the company’s valuation in later funding rounds.
Techstars Cloud taps both local mentors from cloud infrastructure giants such as Rackspace (NYSE: RAX) and others with technical expertise from cities ranging from Seattle to Boston. Mentors range from established local folks such as Rackspace co-founders Pat Condon and Dirk Elmendorf, or newcomers like the founders of the Geekdom Fund, an early stage venture capital fund. Others include people like Boston’s Roger Krakoff of Cloud Capital Partners and Greg Huey of Amazon in Seattle, Yeager says.
“We try to have mentors who have experience selling to developers, building more technical products, experience building ecosystems where you’ve got an API that you’re trying to get other companies to build around and on top of,” Yeager says.
The Techstars Cloud program was founded in 2012, and was Techstars’s first foray into creating one focused on a specific industry vertical. Industry-focused accelerators now make up about one-third of all of Techstars’s programs, ranging from a mobility-focused accelerator in Detroit to a healthcare-targeted one in Los Angeles.
Interestingly, Techstars Cloud also has resurrected itself from the dead— or, more accurately, the Cloud program was able to keep itself from folding after its founding managing director left. Jason Seats, who founded Techstars Cloud, left San Antonio to start the Austin Techstars program in 2013, and the program was on hiatus for more than a year. Seats has since moved on to Techstars Ventures.
Yeager, who knew Seats when they worked together at Rackspace, took over the cloud program in July 2014, and ran his first program in early 2015. Today’s Demo Day marks the completion of Techstars Cloud’s fourth program—Yeager’s second—and the results of the programs show the progress of the San Antonio ecosystem.
While San Antonio may, at times, get outshined by the larger startup ecosystem in Austin, it has done well in its own right, Yeager says. The 33 companies who have graduated from the previous three Techstars Cloud accelerators have raised almost $133 million in funding collectively.
Plus, the San Antonio startup scene is continuing to grow, especially thanks to the Cloud program, Yeager says. The three companies that joined the program from outside the U.S. are hoping to relocate to the Alamo City immediately following the program, as long as they can work through any Visa issues, he says.
“Programs like Techstars have helped to inject fresh talent and have helped to develop the investor side of the community, which are critical pieces,” Yeager says. “I feel like San Antonio is uniquely positioned being both an affordable city to grow a company in and one that has a fast growing population of millennial workers.”