Lightning Lab thunders into Round Two
Lightning Lab thunders into Round Two
The success of New Zealand’s freshest digital companies starts to show as Lightning Lab announces its second accelerator programme to run from March 2014.
With $2.2 million dollars invested into four of Lightning Lab’s inaugural companies, the success of the programme is bearing fruit as the new businesses build their teams, release their products into global markets and ramp up their growth momentum.
Nine teams went through the programme, and founding investor Dave Moskovitz says the outcome is brilliant. “The four companies which achieved investment at the end of the Lab were able to pack two years of development into twelve weeks, and all four are on excellent growth trajectories.”
Even the three companies that have folded have received huge benefits, Moskovitz says, “They’ve saved years of hard slog on a hiding to nothing, having quickly invalidated their basic business assumptions. These are very smart, resourceful, hard-working entrepreneurs. Failure is the best teacher, and they now have a degree from the University of Hard Knocks – I’m sure we’ll see them applying what they’ve learned in the Lab to their next, successful ventures.”
“Huge kudos to the four companies that achieved investment – LearnKo, Wipster, Expander and Publons – keep your eye on these companies because they are going to solidify Wellington’s reputation as the Startup Capital of Australasia.”
Founded by startup incubator Creative HQ, Lightning Lab 2014 already has a growing set of investors and mentors off the success of the 2013 programme, chief executive Stefan Korn says.
“It is encouraging for the New Zealand investment scene to see increasing commitment from the private equity sector for this type of investment. Startups are high risk, and people who watched round one with interest are now putting up their hands and getting ready to pull out their chequebooks. It’s an endorsement of the effectiveness of Lightning Lab that investors can see the value in backing smart entrepreneurs from the beginning.”
See attached for updates on companies from the 2013 Lightning Lab programme.
About Lightning Lab
Lightning Lab 2014: Applications open November 2013, programme runs March – May 2014.
Lightning Lab is the first digital accelerator programme in New Zealand and will supercharge 10 digital startups within a network of more than 100 mentors and an intensive 12-week pathway to prove, build and launch their businesses into market. The programme puts up to $18,000 of seed investment into teams of startup entrepreneurs and pushes them to make their business idea fly within three months, with support from a set of dedicated support technical and business interns, and mentorship from leading entrepreneurs and business experts from around New Zealand.
Founded by startup incubator Creative HQ, Lightning Lab is open to teams of startup founders across New Zealand and the second programme will start March 2014. Applications open in November.
Lightning Lab is the exclusive New Zealand member of the Global Accelerator Network (GAN), which comprises 51 of the top accelerators globally. Patrick Riley, Executive Director of GAN says, “We know Lightning Lab will be one of the best accelerators in the world. Using a proven model to propel entrepreneurs to success and with connections already made with the country’s top mentors and investors, Kiwis are lucky to have an accelerator of this calibre in their country.”
Updates on Lightning Lab 2013 companies
CEO Mike Harbott says Adeez has disbanded. “Our team has moved onto other promising ventures. The wealth of experience, knowledge and contacts that Lightning Lab has brought our team is invaluable moving forward with any venture. It's the most fun I've had working 80+ hours a week.”
Secured investment of $500,000 and has started hiring. Located now in Auckland and Wellington, Expander co-founder Ollie Langridge says, “We're busy in proposal mode with some gorilla clients, and the tech platform is coming along nicely. Recent developments within our target market has made combat counterfeiting and provenance a hot issue, both at company and government level.”
Promoki co-founder Anthony Cabraal said the interest in the market was not sufficient to keep the team together. “It was an amazing learning experience - our team remains in touch as we plot our next ventures. As individuals the Lab has really kickstarted all our thinking and we remain motivated and excited to be in the startup space. Looking forward to seeing the next round of Lightning Lab grow bigger, harder, faster, stronger.”
CEO David Cameron confirmed their investment round closed oversubscribed at $700,000. With more than 100 students and seven commercial training providers working through their first product, they have already identified a new niche to expand into by providing academic English training. “All of this allows us to increase our prices and our margins, while giving more value to our customers. This product is expected to launch mid-September.”
Wipster: Wipster (originally named WIP Videos) closed its seed investment round with $600,000. CEO Rollo Wenlock says Wipster already has an international partner program in the pipe and has rebranded ahead of its first major product release in October.
KidsGoMobile: The KidsGoMobile team have all taken full time roles within the business and hopes to secure investment by the end of 2013 while continuing to grow their team and momentum. Co-founder Pam Ward says they have learned the art of bootstrapping over the past four months. With an early product being tested, she says further development will be the target of a new Kickstarter campaign. “This will show more evidence of our market validation, as will the interest we are attracting through digital parenting events.”
Teamisto: CEO Pat O’Reilly said after demo day they opted not to take the investment offered in New Zealand and focus on the potential in the South American amateur sports market. Accepted in the Startup Chile community along with US$40,000 capital he said the international shift would mean better outcomes for the company. “The Latin American market is quite different to Australia and New Zealand so we are applying our lessons from Lightning Lab and pivoting our way to something more scalable with much stronger direct revenue.”
Questo: Questo was closed down and the team has all gone separate ways taking with them the great learnings for their next projects. “The grounding and rigorous learning in Lightning Lab showed the Questo team what it meant to have the strength to know when something just was not going to work,” says co-founder David Allen.
Publons: Secured $350,000 investment from local and international investors and started hiring. CEO Andrew Preston says, “We've spent our time on building our team and really trying to nail product/market fit. Hope to have some exciting partnerships to announce in the coming weeks.”
Lightning Lab 2014
New Zealand’s Digital Accelerator
Startup ‘acceleration’ is where the urgency and energy of The Amazing Race meets the structure and rigor of business incubation, condensed into a 12-week timeframe.
At the end of it companies pitch to a room packed with investors and market partners (called Demo Day). Acceleration provides a structure that brings focused support at the right time for the business.
The core purpose of an accelerator is to prepare companies for investors. Its key activities are to identify and select high caliber teams and support them to validate a market opportunity, build a prototype or ‘beta’ product and win initial customers in order to secure first stage external investment, commonly referred to as angel or ‘seed plus’ investment.
It is also an internationally proven model for growing a strong entrepreneurial eco-system. It is a structure that enables investors and mentors to participate and grow great companies - but not carry the burden of the startup journey. It enables efficient support for seed stage startups.
Wellington’s startup and entrepreneurship incubator Creative HQ set up Lightning Lab in 2013 in collaboration with a founding group of professional investors because:
• Over 60% of the companies we see are in the digital space and their sustainable success globally relies on swift and efficient execution of go-to-market strategy in the face of competitors with deeper pockets in larger better-connected markets;
• Acceleration provides a structure that keeps companies motivated, moving with pace, aiming high and going for it hammer and tongs!
• There is a need for a more efficient structured model for seed capital to build momentum and support in the early-stage venture space.
• We wanted to inject energy into New Zealand’s entrepreneurial eco-system, and where better place to do it than Wellington, the capital of digital entrepreneurship.
• We fund teams not individuals (up to $18k per team in exchange for 8% equity). In New Zealand most startups ‘bootstrap’, working part time on their ventures. Lightning Lab requires everyone working on the startup full time; this seed money allows dedicated focus to achieve the audacious goals set within the programme.
• The founding investors are a mix of private angel investors and early stage investment funds such as K1W1, Telecom Digital Ventures and Sparkbox Ventures.
Focus on Team
• We fund the people not the idea. There is a huge difference between that initial germ of an idea and the people that are actually able to take it forward and do something with it.
• We wrap dedicated resource around the teams in the form of technical and business interns who help the companies go even faster.
• Lightning Lab is based in Wellington, but is a national programme open to teams from throughout the country.
• A pool of over 100 Lightning Lab mentors will wrap a powerful national and international network of expertise, experience and connections around the companies which will also help grow the ecosystem and energy around startups. A set of these will be local day-in day-out mentors, while others will be leading entrepreneurs from NZ and overseas flying in to inject energy and expertise.
New Zealand representative on the Global Accelerator Network (GAN)
• Lightning Lab is a member of this exclusive network of 51 accelerators across six continents. We are the only New Zealand member and one of four in Australasia. GAN provides Lightning Lab with access to an incredible network of international investors and mentors.
• Lightning Lab is investor-led with a founding set of angel investors providing venture backing and supporting funding from the Science and Innovation group within Ministry of Business, Innovation and Employment (MBIE) for the programme.
September Applications open
October Accelerator Driver announced
January Applications close
February Teams announced, programme starts
28 May Lightning Lab Demo Day