After selecting 10 technology startup companies from a pool of nearly 100 applicants, a business accelerator backed by private investors and the New Jersey Economic Development Authority launched a 12-week "boot camp" to help entrepreneurs in the online, mobile and social media spheres attract enough capital to transform their ideas into viable businesses.
"We were trying to attract technology companies from across the board, but the reality is it's a 12-week program — and what can you really accomplish in tech in 12 weeks but build mobile apps and social media?" said Mario Casabona, a venture capitalist who heads TechLaunch LLC.
Abran Maldonado, co-founder of NuSkool, said he has been "immersed in the New York City tech startup scene" since he developed the idea for an online company that provides educators with pop culture-based lesson plans in April 2011, and he applied to "virtually every single incubator in the tristate area" before being accepted into the TechLaunch program last month.
"I've been to investor pitches in New York, and as soon as you mention the word 'education,' they immediately think you should go the foundation and nonprofit route, and I just didn't feel that was the case, because I have a pretty lucrative business model," Maldonado said.
The Launchpad course at Montclair State University, which began Aug. 6, provides startup teams with business coaching and mentorship to build their technology products and services and develop an effective investor pitch.
Casabona said having accelerators like TechLaunch will provide New Jersey entrepreneurs like Maldonado with a space to work and an opportunity to commercialize their technology, while also giving New Jersey more leverage as competition increases among northeastern states to be the next Silicon Valley.
Casabona said one of the most difficult tasks has been matching the program's 70 mentors — mainly, angel investors, established entrepreneurs and business advisers — with the 10 companies, since "early on, companies may need a mentor with more strategic input, but their needs change as they develop during those 12 weeks."
"Being able to do a pitch is very important, but without business goals, the investor is not going to be interested," Casabona said. "Being a part of TechLaunch is not just a matter of showing you can do a great pitch. It's a matter of showing you can build a great business."
While the EDA supports the program with $150,000 in annual funding for three years, private investors have "oversubscribed" their original commitment of $300,000, making a $20,000 investment in each company while financing several business resources for TechLaunch, Casabona said.
Maldonado said his team has been meeting with the mentors in increments to develop "warm pitches" for investors.
"I don't have an MBA, so my team is hoping to get some guidance with revenue models and corporate structures in general to create a better business model," Maldonado said. "TechLaunch lets us meet with angels and investors on a regular basis, and having them accessible has really been building our confidence to make a pitch and operate as an efficient company."