Accelerators, Startup Performance Enhancement
Transcript: Jonathan Gass: Hey, everybody. Welcome back to another Founder Session. I'm Jonathan Gass, the Founder of Nomad Financial, and our guest this week is going to be ... We're really focused on different founders' areas of expertise, things they can learn, things they get benefit from, and this week we really wanted to focus on accelerators. So we have Frances here, who's lovely enough to join us and really provide, as someone who comes from that world, a number of years in that world, background and information for people who are considering that as a path for their companies. First, Frances, why don't you give yourself an introduction. Before you do, we're going to cheers because Frances just got a promotion. Frances Simowitz: Yay, thank you. Jonathan Gass: Cheers to Nam [inaudible 00:00:55] behind the camera, yes. Speaker 3: Cheers. Frances Simowitz: Thank you. Jonathan Gass: So, Frances, you're now the Director? Frances Simowitz: Program Director, yep. Jonathan Gass: Program director at NUMA. So why don't you introduce yourself a little? Give a little bit of context, and then we'll just have a fun conversation. Frances Simowitz: Amazing. Yes, so, hi, everyone. I'm Frances. I am, as of today, the Program Director of NUMA New York, but I've been with NUMA now for about eight months since we launched here in New York City. Before I get into NUMA, I'll give you a little bit of background on myself. I've been working in the start-up and tech scene for a couple of years now. I previously worked for another start-up accelerator ... well, model, actually founded by the managing directors of Techstars Boston called Startup Institute, where they help people in other industries that want to work in the tech field make that transition. I am also a product of that accelerator, and that's how I got into the community myself a number of years ago. Before that, I was an opera singer and a music teacher, so I have a wide range of creative work across my career. Jonathan Gass: And, to be clear, she's never sung for anybody in this space that I know of. Frances Simowitz: Really? Jonathan Gass: Yeah. But she- Frances Simowitz: You should sit with me in the office with [Aviva 00:02:15] and you'll- Jonathan Gass: There we go. Okay. Now I know. Frances Simowitz: You'll hear it. Jonathan Gass: You're not usually sitting out here singing, which would be amazing. Although, you do wear headphones and a lot of personality. Yesterday was Halloween. Frances Simowitz: Yes. Jonathan Gass: You were dressed as ... Frances Simowitz: Tinkerbell. Jonathan Gass: Tinkerbell. Frances Simowitz: I was inspired by my own hair. Jonathan Gass: Yeah. And I was dressed as John Snow. And we might be the only two people in the office for most that dressed up. Frances Simowitz: I was disappointed by that. I expected more grownups to dress up. Jonathan Gass: Have more fun. That's okay. Frances Simowitz: Yeah. Jonathan Gass: Back to the topic at hand. Frances Simowitz: Yeah. Jonathan Gass: Accelerators. Right? If you're an entrepreneur, and you're thinking about that as a path, right. Do you guys have a rule set or something you think about saying, this is the reason to do it. This is the value you should get out of an accelerator or I know there is a various number of programs and trade offs, but I think you get a high level. What would be the mental path people should have thinking their way through this? Frances Simowitz: Yeah. Accelerators are always really valuable for a number of reasons. By its name, it's a vehicle to get to a goal in an accelerated period of time. The reason why it works is because of the educational components that are within curriculum within an accelerator. But really and truly it's about the network. Being able to meet a lot of different experts and mentors over a smaller period of time that is able to help your business grow or get to where it needs to be whether it's investors, meeting people that are in the financial space and accountants or legal support. It's really a vehicle for support that community really drives that, being able to get to be where they need to be. Jonathan Gass: Got it. How about NUMA specifically? You guys have an interesting story. Frances Simowitz: Yeah. Yeah. Jonathan Gass: Why don't you share the history of NUMA, it's fascinating. The direction it really goes against what most other people have really done in the startup world. Frances Simowitz: Yeah. Yeah. While we've been here in New York for only eight months, we're actually pretty old. We started about 17 years ago in Paris after the dot com bubble burst, they became the builders of the ecosystem, supporting entrepreneurs, coworking spaces, building up community. Then they were also the very first accelerator in Paris for early stage companies. About five years ago, we turned from a nonprofit to a for profit and raised funding and then expanded internationally. We're now actually in eight countries globally. A lot of early markets as well, emerging markets like Casablanca, Bangalore, Mexico City. We're also in Moscow, Barcelona, and one of the newer locations are Berlin and New York. Depending upon the market, whether it's an earlier market or more established such as New York, we have different programs. In New York, we have slightly different than the typically early state model for accelerators where it's just an idea or maybe they have just an MVP. We focus on international companies that are looking to access and scale within the US market, but they are later stage, growth stage. Have at least $500,000 in funding, have traction, and already a product where they are. The focus is really on helping them get set up here. Jonathan Gass: Got it. Really you're the marketing engine of attracting entrepreneurs ... it takes place in your other markets. Frances Simowitz: Yes. The reason why we came here is because there was need from our alumnae. Also, for time zone purposes, New York makes a lot of sense also from an industry perspective over going to Silicon Valley. Jonathan Gass: And New York's better. Sorry guys. Frances Simowitz: Yeah. I know. I'm a native New Yorker. I don't understand why anyone lives anywhere else. But, yeah. A lot of our- Jonathan Gass: As we say that, winter is coming. Frances Simowitz: Oh, yeah. Yeah. Unfortunately. A lot of our startups were already coming to New York and so there was a need, because international founders end up having a lot of the same types of challenges. Addressing those needs was important. Jonathan Gass: You guys have a very specific purpose. I think a value you provide. And I'm sure the educational components that founders goes through is really specific to that. If you're thinking about going through ... you might even be an international founder and you're thinking about going through different programs. They could be applying for Y Combinator or they could be applying for Techstars. How should they develop a process for deciding where to apply, what the benefit is going to be? You mentioned the network, you mentioned some of these softer things. What are the decision making framework that they should have that will allow them to make the best decision as a founder? Frances Simowitz: I think that there are so many now accelerators even in New York and across the world. There was a point only a couple of years ago that there was nine total in the world. The accelerator model has been growing and adapting and as a result though there are programs that are less legit or give less support. Founders should actually be asking a lot of the questions like, what is the structure of the program? How much support am I getting on a weekly basis? Y Combinator, for example, has an amazing brand name, but the actual support that startups are getting week to week is much less. There's less curriculum, but there is an amazing brand name behind it. I think more and more startups should be looking at who is in the network. Who are the people running the program? Who are the mentors and network associated with it? What are the other startups have gone through the program? What are the alumnae like? What are the outcomes? NUMA now has accelerated over 350 startups globally, and have an 82% survival rate, which is really high. Looking at metrics like that to make sure you can get- Jonathan Gass: Over five years. Frances Simowitz: Yeah. Jonathan Gass: Which is impressive. Frances Simowitz: The support is good. Really paying attention to some of those things, and also your specific needs. There's a lot of verticalized accelerators now as well. If you're in a specific industry, you know that the mentors and expertise there will be tailored to you. For us, it's really about the international founders. Getting set up here, incorporating visa issues like most general accelerators like TechStar won't necessarily tailor to those specific needs and so that's why we are catering to those challenges. Jonathan Gass: Got it. Very cool. Okay. Now you're at the point where people are like, okay, I'm going to apply. They're all applying. You're under their side of the table. What criteria are you guys using to choose who should come in? What would you tell founders around that in terms of being prepared, applying for the right place, making sure the application is competitive. What are the things you guys are looking for? And I say this because I've actually as someone who's judged a few of them for you. Frances Simowitz: Yeah. Jonathan Gass: You should give the criteria. Frances Simowitz: Yeah. For us, again we're judging later stage companies so it's a little bit different. For us, really showing potential product market fit in the US is good. If you've already done some of that research and have some of that understanding. Your prior traction within your own market and understanding there is really important. The team, team is always a really important thing. Knowing who is on the team, what previous progress have you had? Why are you the best one to be executing on this solution? Being really clear in your pitch and understanding of what your product does. A lot of founders want to get almost too technical a lot of the time as well in terms of the product features and things like that. But actually keeping it a little bit higher level in terms what is the problem that you're trying to solve and why your solution is the best fit for the challenge is really important. Yeah. Jonathan Gass: Very cool. Very cool. Frances Simowitz: Does that answer your question? Jonathan Gass: I think so. Maybe I need to reframe it. What are the things that could kill an application. Right? I think that's a good framework for ... we've provided something good framework for understanding what the process of what you look for, but what kills that [inaudible 00:10:15] maybe three or four things that you guys see that you're like it's DOA. Frances Simowitz: Yeah. You'd actually be surprised with how many founders don't end up actually being responsive back and forth. And it's two weeks later and then they're responding, that tends to be a red flag if someone's not actually being responsive across the process even if we really like their business. Then they come back three weeks later and then they want to reengage in the process. Those kinds of inconsistencies are challenging. That's one thing. I'd say that that was probably the biggest thing. It ends up being very clear as you're going along, who is really engaged in the process. Who has a really good product and a good fit? Who has a good team? Yeah. Jonathan Gass: You guys are in effect picking people you want to partner with. It would be like dating somebody and they don't text you in two weeks. Yo, I want to work with you, but talk to me in two weeks. You know you're killing that relationship. Frances Simowitz: Yeah. Exactly. Jonathan Gass: Unless, if you're actually behaving that way and you're getting a response from somebody else. Like in the scenario, it should be a red flag to you like, wow, I'm getting a way with this, that's a red flag. What's going on on their end where they're accepting this behavior from me? Frances Simowitz: Exactly. It's just like personal relationships. Jonathan Gass: Do people need to know or have relationships with NUMA or your experience with other places as a path to get in? Is that as important? I know there's a lot of venture capitalists, they're always looking as a signal that people are ... it's a soft intro in as opposed to just being cold email. Frances Simowitz: That definitely end up being the collective knowledge and expertise of the network and the other people that surround you is very valuable. Referrals typically end up being really good quality. If you are able to get a warm intro in, we typically take those conversations with people that are within our network and recommend startups and we do conversations with them, at least do a 30 minute call, especially for that. Yeah. If you are able to get a warm introduction ... It's like anything else. If you're looking to get a job, it's the same thing. Our first round of applications we got over 600 applications. Jonathan Gass: Wow. Frances Simowitz: People that actually came to us recommended. Jonathan Gass: Sorry. Not to interrupt you. How big was that class? 600 became ... Frances Simowitz: Yeah. We have delayed start dates. We start the program every five weeks. Jonathan Gass: Okay. Frances Simowitz: Between September and January, we'll have three startup. We do small on purpose because they're later stage and their needs are so much more detailed than typically a early stage founder needs. Jonathan Gass: The first obligation you guys did you had a half a percent of change of being selected. Frances Simowitz: Yeah. Jonathan Gass: Yeah. Good luck out there guys. You need all the help you can get. A little bit of luck. People make it into the program, you guys have this rate, 82% people still around. What are the keys that people need to be aware of once they step through the door, of how to take advantage of the program best and find their highest odds of success. We know luck has always been a big factor of this. There's no guarantee in it, but there's decisions you can make that increase your odds. What are those things for you guys? Frances Simowitz: Yeah. Coaching founders through how to even utilize the program is really important. Especially if it's a start up that has never gone through and accelerator before. Our program, since it is for later stage startups, often a lot of these companies have already gone either through NUMA or other accelerators, but really for any accelerator that you go through it's about leveraging the network. Even if someone's not relevant to you, always follow up with anyone that you've met. The founders, the VCs, the entrepreneurs that you're meeting as you're going through the program are there to support you and they want to give their time to see you be successful. Often times a lot of mentor whiplash that happens as a result is one of the challenges, where you're hearing so many different opinions and sometimes they are differing. Figuring out who are the people that you trust, that you feel like can actually most help your business. And navigating the varied perspectives that you're hearing through that and talking to those trusted people to help you make the best decisions possible is really important, because you end up hearing a lot of different things when you're going through a program. Jonathan Gass: Do people stay engaged with their mentors after they graduate? Is that a theme as well that you guys see? Frances Simowitz: Yeah. Absolutely. That's really important. You come to an accelerator and you end up exponentially building your network through all the people that you're meeting, with the other founders in the program, the different mentors, experts, people that you are working with. Continuing those relationships as you go on, happens. A lot of times the founders stay friends. Actually, when we did our launch event at Google a few weeks ago, we had three NUMA alumnae on stage and two of them are from the same class and they stay in touch, they were excited to see each other. It becomes almost like a family or a network that you have for life. Jonathan Gass: Which is valuable because as your going through this experience, particularly as a founder, you can be very lonely, and having people around you, I find, going through a similar experience means when you have those really, really bad shitty days, right? To be frank. That you have somebody who can pick you up like, these things happen to everybody, it's not anything unusual, this is the standard test you have to go through. It's like come out the other side of it but it's normal. Then when you have your wins, you have more people to celebrate with. Frances Simowitz: Exactly. Jonathan Gass: It literally is a win win by having it. Frances Simowitz: More people to cheers with. Jonathan Gass: More people to cheers with. Exactly. Given this success rate of founders, are you guys requiring them to do the education components. Is that part of the expectation setting ... that we're going to set up these sessions you have to attend. If you don't, there's a risk of being kicked out of the program? Frances Simowitz: It's not like that for our accelerator. It is for others in terms of having to attend specific sessions. But unless you're going to learn something then it's basically just like a consultancy, where somebody is just giving you intros. The educational component is always actually really important. Usually it's best to have them delivered by industry incumbents, so people that are actually experts in the field. We have three different tracks of focus depending upon the startups need. They focus either on B2B sales, on B2C user acquisition, or on fund raising. For example, for the B2B sales, we actually do a four part B2B sales workshop where I bring in four different experts in the sales field that have built teams, that have sold to enterprise companies to actually teach the content. Not only is that valuable experience in terms of the educational component, but that's another network expert that's coming into work with you that understands your company and is able to provide support going forward. Jonathan Gass: Cool. Going through that process, you gone through an accelerator your, self it's structured differently, you're in one now. What's it like being on the inside? What's it like going through that process even emotionally? Right? I imagine it's very challenging, but I wouldn't know. I've never really been through that. Frances Simowitz: Do you mean working at the accelerator or going through it? Jonathan Gass: For you, somebody going through it. What people who are probably going through it. For you, I know you mentioned just one example of that was to say that you get a lot of mentors all the sudden, you get a lot of opinions. It can be overwhelming. What is it like being someone on that side of the table? Frances Simowitz: Yeah. It can be overwhelming, and there's a lot of doubt. It's a ... What do they call it? When you think you're being a ... nevermind. Jonathan Gass: [crosstalk 00:18:21] Frances Simowitz: Imposter syndrome. Jonathan Gass: Imposter syndrome. Frances Simowitz: Imposter syndrome. Yeah. Which happens. It happens to founders all the time where they don't think they're a real founder. And that they haven't quite got there and going through an experience like Startup Institute, same thing. You feel like you're actually just faking it until you make it. But you're not, you're in the program for a reason. And you were selected, because people see that there is promise either in your business or in your potential and are excited to work with you. We only accept someone into a program if we really truly believe that we have enough of the resources to be able to successfully get you to where you want to go. There's a lot of doubt that happens regardless. That was my experience going through a program. I got to the outcomes that I was looking for which is great. But it's a common across the board. Jonathan Gass: How should people deal with it? Do you have certain recommendations or things that worked for you that you find are useful for someone going through that? Frances Simowitz: Therapy. Jonathan Gass: Yeah. Good health insurance, therapy included. Frances Simowitz: Yeah. No. I think when you were saying before having people to lean on. Whether that's specific mentors or other people in the tech field, entrepreneurs that I admire and respect or I know have my back and I can talk about anything with is really important. Having a support system is really valuable, and being reminded that you are in this program for a reason. Jonathan Gass: Yeah. And being authentic with people. You can't just tell everybody everything is good all the time if you want to have that deeper relationship. You got to pick some people that you're going to be super deep authentic with. You're going to say, "This is the specific things I'm having a challenge with right now. It sucks. I want you to be the ear for me, but also what advice, what have you seen, what would you recommend?" And start collecting data from people. Frances Simowitz: That's a big issue too especially that I've seen a cultural difference between the US and international founders. Founders especially in the US want to ... even more so than internationally, everything's beautiful, everything's rosy, I have everything under control. And have a lot more pressure on themselves as opposed to a lot of international founders are a little bit more like, yeah, it's okay. It's not great. I think that is something to consider. Jonathan Gass: Do you think part of it is culturally in America our identity is more tied up in what we're doing? Frances Simowitz: It's really interesting. I've had a lot of discussions about that recently with international founders. I've met a few NUMA alumnae. I had lunch with one last week that had done the program in Paris in 2012 and he is coming to the US now and he has this really awesome video production startup. They were talking to people in LA that are their competitors, and they were like, "Oh. We've never heard of you." And they're like, "Well that's funny. We've been watching your progress for the last five years." America is very America centric. Even when we do a competitive landscape, we're not often looking at what's actually outside of the US. Where internationally, if you're a company and you do a competitive landscape, you're definitely looking at exactly what people in the US are doing. Jonathan Gass: One thing we like to do because we only have a few minutes left. Frances Simowitz: Okay. Jonathan Gass: Is always ask our guest just for general advice you would provide founders. Anything you've learned over your time in this space that you think ... the three or four things that if people walk away they go, these are three or four things I should remember that will help me find success. Frances Simowitz: Yeah. I would say, build a network. Your network is really, really valuable even if you're the type of company that isn't community based, have people that you can rely on. I would say, be really clear about your road map and what advice that you are listening to. There's a lot of different things out there, but trust your gut because I think you have the tendency to right about that. Jonathan Gass: And on that is part of that also being focus. Right? You get so much stuff thrown at you. Frances Simowitz: Exactly. Jonathan Gass: It's easy to lose focus when you feel like you have a lot of potential things to go after especially for you guys. Companies who already have taken a big leap to open up in the US when they already have a market somewhere else. Frances Simowitz: Exactly. And I think last but not least, which is good for everyone whether or not you're an entrepreneur is just live in a way that's fearless. Right? Don't be afraid of failure, because that will always stop your progress. You need to always be moving forward in a way that's like, if it fails we're going to be able to solve the problem, solutions, which is really more just like solutions focused if you have that kind of mindset of we'll always be able to solve it whether that's a pivot, whether that's a fire, doesn't matter, you can solve it. Everything can be solved. Jonathan Gass: Do not be afraid to be the person who shows up on Halloween in an outfit. Frances Simowitz: Yeah. Jonathan Gass: Or if you're watching the second season of Stranger Things, don't be afraid to be the kids who didn't realize in high school you don't where your costumes to school. Don't be those kids. Frances Simowitz: That's me. Don't be those kids. Jonathan Gass: Exactly. Thank you so much, Frances, for joining us. Frances Simowitz: Yeah. Jonathan Gass: Thanks everybody for joining again for another Founders Sessions. We'll look forward to seeing you guys in the future, and hopefully you found this educational. Drop comments in if you have any questions, and we'll always get back to you. Frances Simowitz: Thanks.