Ready, Set, Accelerate: Inside The eFactory’s Accelerator Program

If The eFactory is the engine that drives Springfield’s nationally recognized entrepreneurial culture, then its accelerator program is the spark plug. The program recently graduated its second cohort and has plans for a third next May. The tally so far: a total of nine new businesses in less than six months that are now navigating the community on their own as independent companies.

It’s been a pedal-to-the-metal first year for the program, which plays an important part in Springfield’s burgeoning entrepreneurial scene. Since 2013 Springfield has earned accolades from notable publications for its support of businesses—particularly startups.

“The accelerator is one component of the overall ecosystem here,” says Allen Kunkel, director of the Jordan Valley Innovation Center, which along with The eFactory and Brick City make up Missouri State University’s IDEA Commons in downtown Springfield. “There’s a lot of recognition around our startups, and they’re part of that equation,” says Kunkel, who is also associate vice president of research and economic development for the university.

In true 417-land fashion, the accelerator has been a collaborative effort. It’s backed by a funding partnership that includes the Missouri State University Foundation; RMI, which is a 504-loan program lender; the Springfield Business Development Corp., the economic development arm of the Springfield Area Chamber of Commerce; and the Missouri Technical Corp., a public-private partnership created by the Missouri General Assembly. And although the concept of an accelerator is not new, the structure of this one is unique. In exchange for $30,000 in startup capital per company, The eFactory’s accelerator takes an 8 percent equity position in the business, to be repaid upon the company’s sale or liquidity event. It’s a long-term strategy that carries no real time frame, Kunkel says. So far, the nearly $300,000 in total investment is promising, with Eagle Speak, a company in the first cohort, already having taken on meaningful follow-up funding, and a handful of other startups from the program setting up offices outside of The eFactory.

This community-partnership angle is key to the accelerator’s success, says Rachel Anderson, entrepreneurial specialist at The eFactory. “It’s unique to have so many partners and businesses helping these businesses to succeed,” Anderson says. Professionals at local companies, including big-name CEOs, have provided advice and mentorship, given feedback to practice pitches and looked over financial statements and business plans for the accelerator’s first two cohorts. Additional partnerships with the regional GO CAPS program for high school students studying IT and business, as well as MSU’s departments of business and engineering, have provided resources for accelerator participants and experience for the students who could very well make up the next wave of 417-land entrepreneurs.

“[Springfield] not being extremely large but fairly decently sized allowed us to test our prototype, get some traction and really work out the kinks of our operations so we can expand to larger cities,” Onaolapo says.

The accelerator wants to continue helping these budding businesses, but faced with state-level higher-education budget cuts, the model is changing slightly. Only one cohort will be held each year, but the number of businesses in each will increase. The application period for the third cohort—to include as many as 10 businesses—opens December 1, and the three-month program begins May 2018. Changes from the first two cohorts include earlier deadlines for business plans and additional benchmarking.

The eFactory Director Brian Kincaid says ROI and profitability of accelerator-sponsored businesses, while necessary in the long term, will be only one of the metrics used to assess impact. Just as important are long-term lessons learned, which can lead to success the next time the entrepreneur has an idea. “Many, many entrepreneurs who have failed have, eventually, been successful,” Kincaid says. “The key is fitting that success into a shorter time frame.”

Starting From Scratch

By Hector Cruz, as told to Matt Lemmon

Participating in The eFactory’s accelerator is a whirlwind process. In just 12 weeks, entrepreneurs create business plans, develop products and soak up as much insight as they possibly can from local experts. Hector Cruz, founder of Let’s Do Lunch and participant in the program’s second cohort, shares his experience of starting a business from the ground up.

“I work full-time in Evangel University’s alumni and fundraising office. The whole point is to build meaningful relationships. The genesis of the idea for Let’s Do Lunch was the need to follow up with people, both professionally and socially.

“A friend of mine had been through the accelerator in the first cohort and urged me to apply. My wife’s and my third child was born on November 16, 2016; I finished the application for the accelerator in the hospital room, with my newborn daughter lying on my chest and my laptop on my lap. A couple of weeks later, Rachel Anderson emailed me. 

“My typical day during the accelerator started at 5 a.m. I’d be at Evangel from 7 to 9 a.m. or so. We’d often have two or three people presenting at the accelerator, so I’d often pop over to The eFactory three times a day. I tried to keep 5 to 8 p.m. for family time. Once the kids were in bed, it was back on the laptop to work until midnight.