Coolhouse Labs Incubator to Expand to Ann Arbor, Offer More Funding
Coolhouse Labs, the incubator that has run a successful “summer camp” for startups for the past two years in Harbor Springs, MI, announced this week that it is planning to expand its operations to Ann Arbor next year, where it will host approximately 10 early-stage companies between January and April of 2016.
Founder Jordan Breighner says it’s an exciting time for the incubator. “Right now, it’s just me, so having a year-round staff to work with our portfolio companies will be great,” he adds. “It will be two separate programs in Harbor Springs and Ann Arbor, with two separate managing directors, but we’ll work together on recruitment and delivering resources to our portfolio companies all year long.”
The idea took root after two of Coolhouse’s “rock star mentors”—Joe Malcoun, CEO of Nutshell, and Guy Suter, CEO of Notion—approached Breighner with the idea of opening an Ann Arbor outpost. Brieghner had been searching for a way to remain engaged with Coolhouse alums after they left the program, so he found the idea very appealing.
“Those three to six months post-program are key,” he explains. “We like brand-new founders at the idea stage. What that ultimately means is that it takes longer [to bring a company to market]. Ann Arbor will provide a landing path for companies coming out of here. They can continue to stay engaged with our investors and mentors.”
In a blog post, Malcoun wrote, “We’re really excited to get Jordan involved in the Ann Arbor tech community. The success he’s had with Coolhouse in Harbor Springs has been amazing to witness and we couldn’t be any prouder to help bring his game to Ann Arbor.”
Coolhouse is currently looking for a full-time managing director in Ann Arbor who “understands what the community’s needs are.” Breighner points out that Ann Arbor is a long-standing innovation hub, so he’d prefer to hire someone local who knows and appreciates the community’s history.
Another change announced by Coolhouse this week is the amount of investment it will offer its startups. Currently, they get $25,000 in exchange for 6 percent equity. Starting this summer, Coolhouse will offer an additional, optional $25,000 convertible note to each company. “It’s part of our goal to provide more resources,” Brieghner says of the new funding.
Brieghner says that despite convening another successful summer cohort in 2014, the Coolhouse family suffered a loss in the fall after Nate Kroll, founder of portfolio company LeaseMaid, diedunexpectedly. “We had no plan for that,” he says, adding that LeaseMaid raised more follow-on funding than any other Coolhouse company. “We spent a lot of time working with his investors, but we ended up shutting the company down.”
Several other Coolhouse graduates have gone on to raise follow-on funding, including 2013 participant TRNK; 2014’s Project Travel, which has gone on to raise a $700,000 seed round; and Local Fu, which recently scored a second investment from Start Garden.
“Local Fu is growing like crazy,” he says. “We brought them here from Philadelphia, and they’ve since relocated to Ann Arbor. That’s part of the thinking here [regarding the Coolhouse expansion]—when companies move from Harbor Springs into the Ann Arbor ecosystem, we want to have resources in place.”
Coolhouse is currently accepting applications for its summer 2015 program, and it will begin accepting applicants for the Ann Arbor program in early fall.