Launch Pad to open tech accelerator in downtown Miami
Posted on September 28, 2012 by nina
Published by The Miami Herald
Through a first-of-its-kind public-private partnership slated to be announced Friday, a new technology business accelerator designed to recruit and cultivate high-growth start-ups is coming to downtown Miami.
The Launch Pad Tech Accelerator, created by The Launch Pad, an entrepreneurial resource center at the University of Miami, is backed by nearly $1.5 million in public-sector funding. Miami-Dade County is contributing $1 million over four years; the Miami Downtown Development Authority is investing $460,000 for operational expenses over two years.
It’s the first time the county and city have partnered to fund an endeavor to position Miami as a hub for start-up technology businesses, said Jack Osterholt, Miami-Dade County’s deputy mayor.
Across the country and globally, accelerators provide the resources, mentoring and networks needed to grow technology companies with high potential to create jobs. When the DDA began exploring ways to promote and build an entrepreneurial culture in Miami’s urban core, it looked to models that were already working, said Alyce Robertson, DDA’s executive director. “We didn’t have to reinvent the wheel. Launch Pad’s program is nationally recognized.”
The Launch Pad, started in 2008, has helped UM students and alumni launch more than 80 businesses, said Susan Amat, its co-founder and executive director. The Launch Pad model has been replicated at six universities nationwide.
The downtown Launch Pad Tech Accelerator will accept 10 companies in three sectors that will support existing industries: tourism/hospitality, creative (art, design, fashion, music, film) and healthcare. The accelerator will also offer expertise in Latin American opportunities in those sectors. The first program will begin in January.
“The goal of this program is economic development for the county. It’s all about attracting amazing tech entrepreneurs from all over the world who are in these verticals that South Florida has as strengths,” Amat said. “The accelerator model in itself is a true innovation.”
The accelerator will be based at Terremark’s downtown Miami NAP (Network Access Point) of the Americas, the physical and virtual meeting point for all optical, Ethernet, voice and Internet traffic between Latin America and the rest of the world.
Miami City Commissioner Marc Sarnoff, chairman of the DDA, has been a proponent of the accelerator from the beginning. “There has never been a very concerted effort to create a technology hub in the downtown of Miami,” the commissioner said. “With the NAP, remember we are the only North American Access Point in the world, we are extremely well situated to build on the premise that we can be and are and should be a technology city.”
How the program will work: Companies selected in a competitive process will get three months of intensive entrepreneurial training, office space and $25,000 grants; office space and mentoring will continue for a year. In addition, Amat said, the entrepreneur will get a support system for life.
The Launch Pad Technology Accelerator will also “adopt” 25 local tech start-ups that will have access to structured programming events, mentoring and a reduced rate for office space at a location nearby. “The goal is to make downtown the place to be if you want to do tech,” Amat said. “There’s a lot going on down here, but it is really spread out. Once we bring everyone together, it is going to feel like a very different place very soon.”
What also differentiates this accelerator from most, Amat said, is that it takes no equity stake in the businesses. The $25,000 grants, which will be funded by the county for the first four years, have no strings attached for the entrepreneur.
Although uncommon, the nonprofit model for the accelerator can work.
For entrepreneurs, “there’s a pressing need for non-diluted money at these early stages,” said Ted Zoller, a senior scholar at the Kauffman Foundation, a nonprofit entrepreneurship think tank. For the accelerator, the keys to success, he said, “will be to get qualified entrepreneurs involved, it has to be privately driven, it has to be competitive, it has to be really focused on what the market needs and it has to be real world. My expectation is Launch Pad does just that.” But he warned sustaining the nonprofit model will be a challenge; the accelerator will need to look beyond the government for funding. “Of course, they are going to have to bring in the high-net-worth individuals that start writing checks.”
Linking the start-ups to sectors of strength in the existing local economy is a smart idea because that brings together customers, serial entrepreneurs and financiers in those industries; with all three you have a compete ecosystem, Zoller said. “If [organizers] are using the same concepts as they are using at the university, my sense is they will be very successful. … They have unlocked the power of the network,” he added.
Amat believes UM students will also benefit from the Launch Pad Tech Accelerator. They could work as part of the start-up teams, receiving real-world experiential learning, she said. ”The skills sets of students in law, engineering, medicine, business., communication and music can all be utilized, honed and enhanced through Launch Pad Tech in ways that could never be done in a classroom.”
Internet marketing entrepreneur Loren Ridinger, co-founder of MarketAmerica.com based in Miami Beach, says start-up companies that may not have considered moving to Miami will now.
“The technology accelerator is exactly what Miami needs to become the hub of tech start-ups in the hemisphere,” Ridinger said. “Many start-ups in art, fashion, travel, lifestyle would be excited to call Miami home, but it has been hard to attract them when there hasn’t been anything like this.
“People don’t associate Miami with a tech hub — this gives us more sophistication. It lets us play with the big dogs.”