Allan Tear is managing partner at the consultancy Aptus Collaborative and a serial entrepreneur well-known in local technology circles. In 2008, he was chosen as one of PBN’s 40 Under Forty. Tear talked with Providence Business News recently about his latest project: Betaspring, a Providence-based startup aimed at young entrepreneurs.
PBN: Where did the idea for Betaspring come from?
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TEAR: The three partners in Betaspring – myself, Jack Templin and Owen Johnson – have been building and connecting the community of technology and design entrepreneurs in Rhode Island through Providence Geeks, RI Nexus, Open Coffee, and Connect Providence. We felt the existing startup ecosystem had become pretty healthy, but that the number of new startups was still way too low, and that one of Providence’s biggest assets, its 20,000+ university students, was disconnected and under-leveraged.
When we saw the early success of a comparable model called Y Combinator in Boston and Silicon Valley, we said, “We have all the right ingredients here – we should do this.” It took about a year to get all the pieces together, so we are launching our first program this summer.
PBN: How does it work?
TEAR: Betaspring is like a development league for first-time technology and design entrepreneurs who are ready to build a product, launch a company, and change the world. Young entrepreneurial teams from around the world go through a competitive selection process to come to Providence for our 12-week “boot-camp,” for which they give up a small percentage of company equity. Our job is to help the startups get up and running, provide mentorship, connect them with the community, and line up investors who want to fund them. Their job is to go from team and idea to a prototype with some customer feedback and a company pitch they can deliver with confidence.
Each week, teams meet with mentors who offer feedback on concepts, ideas and prototypes, as well as provide valuable insight into how to scale a company and deal with the obstacles along the way. We provide guidance from qualified counsel on startup legal issues, like getting incorporated and dealing with equity. Our teams get access to Betaspring HQ, an incredible co-working space located at the new Rhode Island Center for Innovation and Entrepreneurship (RI-CIE).
During the last two weeks of the program, the teams will pitch to pre-qualified angel investors, seed funds and corporate partners from the Boston-New York City corridor. The next time we run the program, Betaspring will be making small equity investments – $20,000 on average – in each startup.
PBN: You held your first event last week. How did that go?
TEAR: Great, especially since we were competing with Mother Nature on a sunny Saturday! We were able to draw a mix of more than three dozen entrepreneurs, Betaspring mentors, and members of the Providence tech and design community to RI-CIE for a day of networking and mentoring.
In the morning we set up some entrepreneurial “speed-dating”: individuals had five minutes in round-robin sessions to get and give advice, practice pitching their ideas and connect with other members of the Providence entrepreneurial community. In the afternoon, 10 teams pitched their company ideas to our panel of experts, which included a serial entrepreneur, an angel investor and a venture capitalist.
The teams were able to receive immediate feedback in a low-stress environment and many of the teams have incorporated that feedback into their applications for the Betaspring 2009 program. Based on the overwhelmingly positive reception, we’re increasing the number of open events that will be a part of the Summer 2009 Program.
PBN: Do you see Betaspring as part of a larger trend?
TEAR: Definitely. The barriers to turning a good idea into a high-growth company are falling, because technology costs less and the tools are more accessible, and you can be connected to talent and to customers in real-time through the Web. At the same time, traditional venture capital funds have abandoned the very early-stage startups, leaving a funding void for the micro-seed venture model to fill. Y Combinator, the pioneer of this model, has launched 102 companies in three years, 80 percent of which are still growing, have received follow-on funding, or have been acquired. Originally in Boston and San Francisco, the model has been replicated in a dozen metro regions and counting. TechStars, located in Boulder, Colo., [and now Boston, too,] has largely been responsible for placing that city on the map as a hub for startup and entrepreneurial activity.
Providence, with its wealth of university students, a reputation as a thriving destination city for arts and culture, the recent emergence of a strong technology and design entrepreneurial community, and its prime location in the Boston-New York corridor, is well-poised to make this model work.
PBN: What impact could you see an initiative like Betaspring having on Rhode Island’s economy?
TEAR: Our goal is to create a lot more high-growth startups, especially involving young entrepreneurs. I’m not smart enough to tell you which young company will “win,” but I can tell you that the cities that continually start a lot of companies, get them the resources they need to grow, and recycle their talent when they fail – those are the cities that end up with a critical mass of good jobs and breakout successes. •
