If you're looking get your startup off the ground in Los Angeles, it always helps to have help from folks with connections to the venture and angel community. One of the accelerators which recently set up shop in town which does is Amplify, which is headed by Paul Bricault, who runs Amplify and also is a Venture Partner at Greycroft Partners. Bricault was the founder of The Mailroom Fund, which was focused on early stage investments in Southern California digital media, and prior to that spent significant time at William Morris Agency. We sat down with Paul to learn a bit more about the program at Amplify.
Can you tell us a little bit about the basics behind the program?
Paul Bricault: We're obviously modeled after an aggregation of lots of different accelerators on the market. Before we started this thing, we spent three months traveling around to accelerators around the country, in Cincinnati, Austin, San Francisco, Waterloo, and Vancouver, Canada, and New York City. Then, we went and built a best practices deck of those different models. The standard model for an accelerator is, they provide a tranche of equity, along with a suite of services that varies by different accelerator. The amount of capital varies by accelerator. We decided, after looking at Los Angeles, that what was needed most in Los Angeles, and what entrepreneurs were interested in here, was that we'd need a little bit more capital offered than other accelerators. It's not a lot more, juts a little more, but it's because the Los Angeles is more difficult to sustain a startup than in Cincinnati or other places. So, we are offering $40,000 to $50,000, and we're also adding lots more services.
In particular, we've created a place where startups can co-locate. For instance, YCombinator works in San Francisco, because there's such a huge proliferation of startups, working in a very collaborative environment. Because of that, you get to meet slots of people in the community, because there's such a prolific number of entrepreneurs. You can also find help with coding, programming, someone to help check out wireframes, consulting, help with capital advisors, etc. whereas in Los Angeles, there's sort of a paucity of those kinds of resources. Because of that, the second thing, in addition to more capital, we thought we should have a building where there is lots of entrepreneurial activity, and where they could be lots of entrepreneurs in different stages of development. I call that the freshman, sophomore, senior model. Companies in the accelerator can walk upstairs, talk to someone who's already been funded, and get counsel on how they went through that process.
Can you talk about that space?
Paul Bricault: It's a 10,000 square foot building. In addition to the companies, we're leasing space to companies who have already gained capital, and second and third time entrepreneurs. We're looking to be a place where people can rub shoulders with others. We're developing a community, a co-working space, and there will also be events on a consistent basis, in addition to events just for companies in our program.
How long is your program?
Paul Bricault: Most programs, about 90 percent of them, have a standard 3 month term. That's 90 days in and out. We've actually lengthened ours by one month, and are doing four months. We maintain that because there's not as many seasoned or second time entrepreneurs here, we might need an extra month to get to the point where they can actually go raise capital. That's actually borne fruit in our first class. The other thing, is we wanted to provide more services, so that there's less friction for entrepreneurs. LA is geographically diverse, and distributed. We wanted entrepreneurs to be able to walk into our building services are in place when they walk in the door. Lots of accelerators are a work in progress, and they've just started talking to people to bring on resources to help out. When we opened in December, we already had a relationship with Joyent for free hosting, Fenwick and West as a law firm, and PricewaterhouseCoopers on the audit and financing side, Silicon Valley Bank, TriNet, Frost and Sullivan, Microsoft, and a number of other partners already linked to the companies. We also have a brand partnership, Coca Cola, which is actually funding internal development projects who are using our companies to develop them. We also have a co-working space. There are lots of things here happening simultaneously, all tied into the core theme that a rising tide lifts all boats. We're looking to help the entrepreneurial ecosystem in Los Angeles, not just funding five or six companies at a time, but bringing in an entire, entrepreneurial community and more broadly industries such as entertainment and technology, and have them come into the space.
You mention different industries. Are there specific kinds of companies or industries you are targeting?
Paul Bricault: We're targeting companies that have been endemically successful in Los Angeles, and take advantage of the talent pool. We don't do hard tech, or biotech, which don't have a history of success historically in Los Angeles, or which don't have the ability to be accelerated because of the nature of the businesses, in four months. It's very hard to build something like a biotech in four months, because of the research and development. That's the same with clean tech, or hard technology businesses. Instead, we're focused instead on ad-tech, which has long success in Los Angeles, from Overture and traffic marketplaces like Adconion, etc. We're also looking at mobile, because of the presence of Qualcomm and a huge body of talent around mobile, and social commerce, because of our success in social commerce, most recently with BeachMint, ShoeDazzle, and others.
We're also looking at gaming, which has a long history in LA, and because we have a huge presence from EA, Activision, and going down south to lots of companies in the south bay, like EverQuest and Sony Online. We're also interested in disruptive media, any company that is helping to reinvent any component of the media ecosystem, across any platform, like publishing, film, television, and music. That's all obviously relevant to the LA ecosystem. That said, there are no rigid rules, and we're open to others who might fall outside those areas. I also forgot to mention, we have no rigid start date, and there's no regimented class start date like every other accelerator in town. One of our distinct features are staggered start dates. We believe it works better for entrepreneurs, and for people inside the facility, with people coming in and out.
I understand you also have a number of backers and investors in this?
Paul Bricault: We had looked at the best practices with accelerators, and we found that most accelerators either have single LPs or dual LPs. However, we found that, across a broad spectrum of companies, companies with a broader funnel of investors tends to have more success over a longer period of time. That's largely a product of the qualify of flow. The better a funnel you have in any business, whether that's lead generation or otherwise, the better product you get a the end of the day, and the better success rate. We wanted to set up in the beginning with the strongest funnel possible, and our number of investors speak to that.
It's not like a typical startup, where fewer investors are better. I don't believe that in our case you can have too many investors, because in our business it's relevant to have people with skin in the game, and to help hand on leads, come by and help with companies in the program, but more importantly send companies to us. If they are venture capitalists, it might be companies who are not appropriate stage-wise, or if you're an angel you might want to send companies our way to nurture them along, so they can grow, and then later invest in them at the appropriate time.
Everyone who is an investor in Amplify has been an angel, someone might bring some strategic value, having been a media executive, technology executive, or involved in a venture firm. Five venture firms are our core anchors, and we have a huge body of angels and media and technology executives buttressing our list, to provide added value to entrepreneurs.
One reason we have those investors, is I think that demo days won't work in LA. Why they won't work, is because we only have a handful of active venture capitalists here. So, when we decide to throw a demo day, it won't be like the demo days in Silicon Valley. YCombinator can have 300 people show up for an event at the Computer Science Museum, because those people are all within a half a mile or just a 30 minute drive. In Los Angeles, it's much more difficult to get people to fly down here. So, having venture firms invested in our accelerator, and included in our support companies, helps them come out to see us. That's already proven as an incredibly successful model, with four of our companies out raising money right now, and commitments from a number of investors in Amplify. Effectively, they didn't even have to leave the building for fundraising.
Where are you in terms of companies in the program?
Paul Bricault: There are six companies accelerating in the program currently, and there is one offer out to a seventh company. That's exactly in line with the model, where we wanted seven companies as of March 1st. We're one company short, which is pretty darn close. The model is twenty companies through the program in the first year.
Finally, what advice would you give entrepreneurs looking to get into the program?
Paul Bricault: We look at companies across a broad spectrum. If you go to our website, there's a standard application to apply. Although there's a very obvious and simple way to apply to the program, it's really going to depend on the company and type of entrepreneur and market you're going after. We accept companies with just an idea, and we also reject companies with just ideas. It depends on the quality of the idea, the quality of the entrepreneur, and the team. There's a number of different components involved. Of the first seven companies, two came in and were already in process of selling their product. That's very unusual, and that's not why we got into this. There's a wide continuum. We're working with companies who are very, very early, to companies who already have market traction. It's a case by case scenario. Every company looks like a snowflake. We'll look at the team, the size of the market, the competitors in that marketplace, and how they're going about it. It's basically, how they handle the interview process and interact with the founders. We also bring in mentors to our review process, which is very important. Another thing, is how companies get referred into our program. Anyone can come across the transom and website and can get into the program, but obviously, if you happen to get recommended by advisors, mentors, and investors, then just like any venture firm that gives you higher proclivity to get through the interview process faster. It doesn't guarantee success, it just puts a checkmark in your corner.