OLC attended NYTech International Meetup's event: Talks on International Incubation and Acceleration at Columbia Business school on Wednesday, March 6, 2013. The event featured five panelists: Tom Bronfeld, co-founder of IDC Elevator; Mahogany Beckford, who works for JFDI Asia, Singapore's first startup accelerator; Anatole Faykin, an entrepreneur formerly based in Santiago, Chile as part of the Startup Chile program; Tiago Compagnoni, creator of the original WEDEMAND system with the help of Brazilian incubator, 21212.com; and Jayesh Parmar, CEO of Picatic.
Anatole Faykin was the first of the panelists to introduce himself. "Let me first explain what Startup Chile is," Faykin said. "It's a government incubator and possibly one of the few incubators that give money to the company, but doesn't take equity from it. The only condition is that the government gives you $40,000 and six months to spend on the company. The Chilean government provides a working space and it's probably the biggest incubator out there," he said.
Mahogany Beckford introduced JFDI as a new concept in Southeast Asia. "It's a new concept in Singapore to have an incubator at all," she said. "JFDI [Joyful Frog Digital Incubator] is not affiliated with the government. About 20 companies have gone through JFDI and you start off with $25,000 in Singapore dollars. The investments can reach up to $300,000 in Singapore dollars and provides a mentorship program that lasts for six weeks, which gives companies access to mentors, alumni and investors," Beckford said.
Tom Bronfeld said, "We started at components that create entrepreneurial spirit. We looked at the Israeli entrepreneurial space and realized that there's no space to scale. We looked at the ecosystem and found out how much they needed an incubator so we gave them $20,000 to start and gave them help to plug them into the entrepreneurial space in Israel as well as bridge the gap between talent and the economy."
"I'm a co-founder of a company that went through one of Brazil's first incubators. The main thing is that 21212 gives Americans easy ways to scale and succeed in Brazil. Brazil used to be hard place to do business, but the market is very new and there's hardly and competition," Tiago Compagnoni said.
"Picatic is crowdfunding for events," Jayesh Parmar said. "From incubators and accelerators—Extreme Startups is probably the world's most unique because it gives a lot of money and only chooses five startups to incubate. To be successful, you need to learn the ecosystem and make relationships with people," he said.
The panel briefly opened to audience questions. "What's the agenda that startups have in Chile," an audience member asked. "Considering that it's government money," Faykin said, "the Chileans are surprisingly straits-free. You don't have to stay in Chile, you don't have to complete it in Chile. The government originally didn't let Chileans apply for the first two rounds, but now it's open to everyone. They're more focused no on just the international story, but on the national and local level," he said.
"Any limitations on who can apply to incubators?" a member asked. "It depends," Compagnoni said. "But in our case, you can apply to incubators without a tech team. It's not a good idea, however, to apply as a single founder. It's too much responsibility," he said.
The moderator stepped in to begin the round of questions. "Do you have any reasons for going abroad? What were your experiences?" he asked, directing the questions to Faykin and Beckford. "We were not carpet-bombing accelerators," Faykin said. "Elevators, incubators...we liked the conditions Startup Chile was offering, so we applied. It's the only place we applied to and a number of factors came in together; the main one being, they accepted us. It wasn't as huge a leap for us to work abroad. It felt like an extension of my journey," he said.
"I went over as a student," Beckford said. "And it made sense to start a business in Singapore. I like Singapore and Hong Kong and it's easy to start companies there. The system's there to make it easy for you," she said.
"Do you have any insights or experiences from your time at Brazil?" the moderator asked Compagnoni. "It's easy to succeed in Brazil because there's no real competition there," Compagnoni said. "What brought us to Brazil was the opportunity to work there and in the United States. By working in both places, you're 30 percent more likely to succeed in the Brazilian market. It takes about four months to open a company in Brazil, where it's like two days in the US."
The moderator turned to Bronfeld to ask about what it was that Bronfeld was looking for and expected in Israel. "I look at founders and meet most of them," Bronfeld said. "I believer there's three ways you can determine from business models. One, they aren't good enough and everyone can see that. Two, they can be coached. I don't care about ideas, by the way," he said. "I'm looking for talent. And three, they're fully committed and they're at this project 100 percent. I think at the beginning, you're investing in people," Bronfeld said.
"Do accelerators create cookie-cutter companies?" the moderator asked Parmar. "Do you feel that this has been the case?" Parmar answered, "In order to invest, you don't want a 'me too' company. If an incubator offers oxygen—and oxygen is money—take it. Canada has identified two places—Silicon Valley and New York City—and has identified two hotspots—RocketSpace and General Assembly."
"How effective is the demo day?" the moderator asked. "Demo days are a scam," Parmar said. "It's all smoke and mirrors. You pitch to a bunch of investors that already know you. Most of the time, you already have investors before you go through demo day," he said."
"The whole idea of investors," Bronfeld said, "they want to know before other people know about your product. It's all behind-the-scenes action."
"You investors are looking at your product during boot camp," Beckford said. "Demo day is important for media, though. If you can get written up by the media, that's good exposure."
"It's a milestone for investors," Compagnoni said. "It's just for show, but it's something new that Brazil is experiencing right now."
"The first couple of months, Startup Chile requires you to do some sort of presentation," Faykin said. "But after those months, it's up to you to attend demo day or not."
"What is the biggest challenge you faced when moving to the US?" the moderator asked. "For us, it was competition," Compagnoni said. "You have to work really fast. So when you come to the US, everything you have to do has to be done quick, or someone will have completed your idea before you."
"I think it's a lack of relationships here," Bronfeld said. "The biggest challenge is a lack of network that international companies have entering the United States. You need to find the right people to get your opportunities."
"Ours was visa," Parmar said. "The second was burn rate."