Excelerate Labs will be named TechStars Chicago, Boulder-based TechStars’ chief executive David Cohen announced on his blog. The Chicago program joins accelerators in Boulder, New York City, Seattle and Boston, all of which were founded and launched by TechStars.
“As TechStars has expanded into new cities, we’ve always started our programs from scratch. But Excelerate made us think differently,” Cohen wrote. “We were so impressed with what they’ve built that we asked them to join forces with us and turn Excelerate Labs into TechStars Chicago. TechStars and Excelerate have always been kindred spirits: We both put entrepreneurs first and believe in the power of mentorship.”
The merger gives TechStars access to Chicago’s growing startup scene and capitalizes on an already existing relationship between the programs, Cohen wrote. Cohen said he and fellow TechStars co-founder Brad Feld have mentored Excelerate’s team since its launch three years ago.
For Excelerate, it gives it and its alumni access to more investors, contacts, resources and money, wrote Troy Henikoff, TechStars Chicago’s managing director and Excelerate Labs co-founder on its blog.
“Excelerate is a three-year-old startup going through an incredible growth phase, bringing in better investors, better mentors, better companies, and most importantly, better entrepreneurs as it matures. Like any other high-growth startup, there comes a time in the life cycle when it makes sense to pour fuel on the fire,” Henikoff wrote. “Today is that day.”
Like TechStars, Excelerate Labs provided the founders of startups with access to mentors and potential investors and guidance about forming a company. Both programs also gave startups seed money – $25,000 for Excelerate, $18,000 for TechStars – in exchange for about 6 percent equity. Each program also offers convertible debt to admitted startups. TechStars companies are offered $100,000, while Excelerate offered $50,000.
Both groups have compiled an impressive record in their short history. Excelerate said the 30 companies that graduated from its three classes have raised a total of more than $30 million. In TechStars’ case, 175 companies have been through its programs, and they have raised on average $1.49 million.
In addition to the five cities TechStars is in, it runs accelerators for Microsoft in Seattle and Nike in Portland, Oregon, and a cloud-focused accelerator in San Antonio, Texas.