We have been researching start-up events, workshops and extended incubator programmes that have been developed to encourage innovation, quick testing of ideas and a means of developing wider networks and teams. We are interested in how these processes and formats could be adapted to develop cultural and community projects.
One of the most successful of these seed funding programmes is called Y combinator, based in Silicon Valley. It is essentially a “bootcamp for startups” and is a fixed term, team based program that provides mentorship, education and culminates with a public pitch. The Y Combinator is the most famous incubator program and is repeatedly voted the best in the world. Their technique is obviously working as some of the most innovative companies such as reddit, Airbnb and Dropbox have come out of the Y Combinator.
The Y Combinator uses an application process both online and with a meeting which allows the funders to choose the best team with strong ideas. They focus on selecting teams not on individuals, as they have realised that a strong team is one that can take a good idea to the next level. Additionally they work with cohorts of startups instead of individual companies, sometimes up to 80, this creates a network where people can meet and learn from one another. As one of the founder’s says “One of my goals since my last job was to stop working with mediocrity and find/surround myself with people smarter than I. YC definitely provided the quality of people I needed to be around.”
Time is also important in the process. The 3 month cycles are effective because it is enough time to be ready to launch, but the short length encourages focused development by iterating and testing ideas as quickly as possible. As they describe “we usually advise startups to launch fast and iterate”. Over the course of the three months the focus is on developing the projects in “office hours” where they can get advice from the team of advisors and develop that network through activities such as the weekly dinner where eminent speakers are invited to speak informally. The development focuses not just about the product they are launching but the from marketing, to legal aspects to fundraising strategies. The Demo Day which now attracts about 450 investors, allows the start ups to introduce themselves to potential investors.
Finally the financial model provides less risk for both the startups and the investors. They provide a small investment in the company, previously it was $14,000 – $20,000 but since 2014 it became $120,000 for the startups in exchange for 7% of the company. For the funders there’s less risk involved as it’s only a small amount of capital and what they give the startups in advice and mentoring is worth more. For the startups, this money means they have the financial freedom to work on their ideas, often cultural and creative development is done in a organisation’s own time and at a loss to the business.
Although the Y Combinator is currently for tech startups we wonder if it’s a model or framework that could potentially be applied to the development of community and cultural projects as a means of focused activity, a close peer network and direct connection and pitch to public or private funders..