When [Mario] Casabona reminded TechLaunch’s 10 resident CEOs on Tuesday to start thinking about tax returns, the room filled with groans and sighs.
The truth is that poring over Schedule C or 1065 forms is a good problem to have. As the first TechLaunch cohort, the entrepreneurs had $20,000 to spend on their startup companies and several even managed to find paying customers.
TechLaunch, a startup itself, is the state’s first technology accelerator. With a $150,000 investment from the New Jersey Economic Development Authority, and twice that in matching funds from private investors, the center has been mentoring, educating and grooming 10 early-stage companies for a Nov. 1 debut with investors. New Jersey hopes if it builds a startup-friendly ecosystem, with accelerators, incubators and affordable co-working spaces, the entrepreneurs will stay instead of flocking to New York City or Silicon Valley in California.
For the past four weeks, the second floor office near Montclair State University in Clifton has been filled with tough love and comradery. Most days the CEOs focus on their own companies, making phone calls, meeting with mentors and tweaking their products. But on Tuesdays they meet with guest speakers and test their company pitches on fellow entrepreneurs before doing a full test run for Casabona during rigorous Wednesday night pitch practice.
This week it was LivinSport founder Jason Webley’s turn to test the first three minutes of his investor pitch. Before long the entrepreneurs had picked apart his font choices, color scheme, slogan and how he ordered the slides in his presentation. It’s not an unusual scene at TechLaunch.
“We’re pretty rough on them, but not as bad as the guys in New York will be,” Casabona said. “We’ll say stuff like: Stop stuttering, look at me, speak up or don’t look at that while you’re talking.’”
By ‘guys in New York,’ Casabona means some of the high profile investors who will visit Montclair State University on Nov. 1 to size up the first TechLaunch class and potentially invest in their companies.
Webley, a runner and soccer player, has created a social network that helps middle school and high school athletes market themselves to college or professional teams.
“I saw my friends, guys who could potentially go to the next level after college, get stuck and not know how to approach coaches,” he said. “A friend of mine started his own soccer academy and he’s very successful now. That inspired me to do this.”
Each day he meets his co-founder, Michael Liguori, at TechLaunch. Lately they have been reviewing feedback from the people who have been testing their website. In a little over a week they’ll unveil a public, alpha version of it and want to have the beta version up and running before they court investors on Demo Day.
“If something really is not good, they’ll tell you. They’ll say your slides aren’t good or you need to improve them.”
An angel investor like Casabona, chairman of Jumpstart NJ Angel Network and past chairman of the Research and Development Council of New Jersey, sees runningTechLaunch as an opportunity to straddle the business and investor divide.
Typically entrepreneurs begin raising money from friends and family, spend one or two years readying the company for a round with angel investors and then start approaching venture capitalists.
“The problem for any investor at any phase of funding is deal flow – getting quality deals or low-risk deals,” he said. “By the time a lot of companies get to us, there’s very little we can do to de-risk that deal. With TechLaunch we can get investors involved at very early stages.”