Government and Accelerators Partnerships
This brief documents two case studies of city governments partnering with existing startup accelerator businesses. The first case study details the partnership between the City of Sacramento and Berkeley SkyDeck, and the second case study covers the partnership between the City of Houston and MassChallenge. Each case study provides details and information about the relevant parties, the motivations of each party for entering into the partnership, and the funding and steps that were taken to facilitate the partnership.
City of Sacramento and Berkeley SkyDeck
- Berkeley SkyDeck is a startup accelerator program from the University of California Berkeley that supports startups founded by students, alumni, and faculty of UC Berkeley to help bring their research and ideas to market. Although the primary focus is UC Berkeley, SkyDeck also works with startups founded by affiliates from any of the other University of California campuses.
- SkyDeck also has a variety of programs that provide UC Berkeley students with internships and professional development opportunities that help them gain experience and knowledge about startup creation and launch. The overarching goal of SkyDeck is to further and enrich Berkeley research by bringing it to the public market.
- SkyDeck's startup accelerator program is the Berkeley Acceleration Method (BAM). BAM is a six-month program designed to prepare startups for success in Silicon Valley by preparing them to raise funds from Venture Capitalists in Silicon Valley.
- The BAM program includes expert-led workshops, one on one advising, networking through the UC Berkeley community, and introductions to investors.
- The City of Sacramento, CA has shown strong interest in supporting emerging technology and pursuing partnerships that will use technology to improve quality of life for the people of Sacramento. This is primarily executed through the Sacramento Urban Technology Lab (SUTL).
- The SUTL is an initiative from the City of Sacramento Office of Innovation & Economic Development which was founded on the principles of the Triple Helix model of economic innovation, in which government, academia, and industry work together to create a "living laboratory" within the city to provide a space in which entrepreneurs, technologies, and businesses can develop, test, and grow new ideas.
- Focus areas of the SUTL include mobility, sustainable technology, health IT and life sciences, food systems, internet of things, government policy and civic tech, and workforce development.
- Other examples of SUTL initiatives include the Verizon 5G Joint Development Partnership under which Sacramento will be the first city to receive fully scaled and practical implementation of the 5G network, and the Electrify America Green City Pilot, under which Electrify America will invest $44 million in the City of Sacramento to help catalyze a transportation shift toward zero-emission technologies.
- In the partnership between Berkeley SkyDeck and the City of Sacramento, Berkeley SkyDeck will bring seven startup companies to Sacramento, and will work with the city to identify and evaluate investment opportunities. After the first year, SkyDeck will continue to refer at least seven of its alumni per year to the City of Sacramento at no additional cost to the government.
- The SUTL will work with these seven companies to navigate the city's regulatory environment, promote introductions and collaborations with potential customers and businesses, and introduce the startups to the local workforce in the hope of creating new jobs and growing industry in the city of Sacramento.
- Leaders within the city government also hope that the formalization of this partnership will promote Sacramento's image as a technology and business-friendly innovation hub, and that this image will continue to attract even more businesses and opportunities for industry growth.
- Caroline Winnett, the executive director of Berkeley SkyDeck has stated that the partnership with Sacramento is an exciting opportunity for SkyDeck companies to expand to new territory and find new opportunities in a nearby, tech-friendly city.
- The partnership between Berkeley SkyDeck and the City of Sacramento was facilitated by the passage of a 2017 bill from state Democratic Assembly Member Jacqui Irwin which allocated $22 million in state funding to be used for the acceleration and advancement of innovation and entrepreneurship in the University of California network.
City of Houston and MassChallenge
- MassChallenge is a global startup accelerator that was founded in Boston, MA in 2010 with the stated purpose of helping entrepreneurs launch and grow new businesses and ventures.
- MassChallenge is one of the largest global accelerator programs in the world, and runs one accelerator program in each of its locations each year. The accelerator program includes support from mentors and experts, access to free coworking space, networking opportunities with corporate partners, workshops, office hours, and the opportunity to win a portion of more than $2 million in various cash prizes.
- MassChallenge accepts applications from startups in all industries and all locations, with a special focus on companies that have raised less than $1 million in equity-based funding, and generated less than $2 million in revenue at the time of application.
- In its ten years of operation, MassChallenge has worked with over 2,400 startups in 54 countries.
- In early 2019, MassChallenge announced that it would work in partnership with the City of Houston and Houston Central to launch its newest program in Downtown Houston.
- The Houston location was designed to support up to 25 new startups for a zero-equity six-week startup accelerator boot camp in the summer of 2019, with a full-length program set to start in 2020. Applicants for the Houston program should have raised a maximum of $500,000 in equity-based funding, and made less than $1 million in revenue in the last year.
- In 2019 the MassChallenge program in Houston received 286 applications, from which 25 teams were chosen.
- Mike Millard, the managing director of MassChallenge Texas noted that Houston represents an excellent expansion location for MassChallenge due to its "high density of entrepreneurs, international access, corporate excellence, and top universities."
- MassChallenge Texas launched in Austin, TX in 2018 and has since accelerated 84 companies, generated $20 million of revenue, and created 524 new jobs. Leaders in the City of Houston recognized MassChallenge as a valuable opportunity to support local innovation, grow industry, and attract new talent, while leaders at MassChallenge viewed the Houston expansion as a way to strengthen their network in the state of Texas.
- The partnership with MassChallenge is part of a transformation process designed to propel Houston towards a more high-tech future and innovate the downtown area into an innovative hub that combines industry, technology, and culture.
- Funding for the MassChallenge program in Houston comes from a grant from the Downtown Redevelopment Authority of Houston which is capped at $2.5 million and will be paid over the course of five years. The program is additionally supported by public-private partnerships with Central Houston and with founding corporate partners including Southwest Airlines, TMAC, WeWork, USAA and Upstream.
To identify partnerships between US municipalities or government agencies and existing startup accelerators, the research team combed through startup accelerator websites and press releases, reliable news sources and articles, and various government websites. Once a partnership was identified, details about the partnership and each party involved were pulled from company press releases, company websites, government websites, and relevant and reliable new sources.