Business Record Daily AM 10.22.19

Grinnell College, Techstars announce launch of Techstars Iowa accelerator

By Kate Hayden | Staff Writer

Techstars, a national network of accelerators and a venture capital firm, is partnering with Grinnell College to launch Techstars Iowa, to be located in Des Moines.

Des Moines entrepreneur and former interim director for the Iowa AgriTech Accelerator Kerty Levy has joined as managing director of Techstars Iowa, which has yet to settle on a physical location in the metro. The accelerator will accept up to 10 Iowa-based startups for the first class, scheduled to run for 13 weeks from September to December 2020. Grinnell and Techstars representatives announced the planned launch this morning at fintech startup Dwolla. Applications for startups will open on Feb. 17 and will be accepted through May 10.

"We believe that talent is everywhere and opportunity is not," said Ivan Lopez, general manager of accelerators for Techstars' western region. "There’s an incredibly thriving and viable technology and entrepreneurial community in Iowa, in Des Moines and in other cities, but the opportunity for venture capital for these entrepreneurs and people who come from idea to product and market is more complicated."

Techstars has 46 accelerators announced or operating internationally with plans for continued growth, although Lopez would not say how many more accelerators are being planned. By the end of 2019, Techstars will have more than 2,000 companies in its portfolio, he added.

"Techstars … really spends time understanding what the strengths and weaknesses and the needs of the local communities are before starting a program," said Jainen Thayer, chief investment officer for Grinnell College. "Whereas other groups have a platform where they basically roll out a one-size-fits-all central accelerator, what Techstars is trying to do is really tailor each location to the individual communities in which they’re operating."

Grinnell is funding the first three years of Techstars Iowa to ensure the program is established and to "make an evaluation of the impact the program is having," Thayer told the Business Record.

Techstars awards a $20,000 initial investment to each chosen startup, or about 6% equity; Grinnell will receive half of that equity, Lopez said. Each startup has a follow-on opportunity through a convertible note of $100,000, he added.

The partnership between Techstars and Grinnell College has been about a year in the making, Thayer said.

"One of the things that struck me about Iowa was that within a relatively concentrated geographic area, the diversity of economic activity within the state is actually pretty remarkable," Thayer said. "The thing that seemed to be missing was how do you go from having a successful business plan or idea or fledgling company at one of the accelerators to being at a stage where somebody like Next Level [Ventures] is going to be interested. … There wasn’t that bridge of where do they go next, what do they do next. That’s a tremendous opportunity from an investment standpoint."

Grinnell will aid in building out the mentorship network using Grinnell faculty and alumni, and will also consider ways to connect students with participating startups for internship and postgraduate work opportunities. Typically, Techstars startups will meet between 100 and 200 mentors during the initial four-week period and select up to five main mentors.

The accelerator is "stage-agnostic" and accepts tech startups in all sectors, from early-stage companies to those that are already raising capital, said Claudia Reuter at the morning launch. Reuter is managing director of the Stanley + Techstars Additive Manufacturing Accelerator, and joined Thayer and Levy at the announcement this morning.

"We really want to take what is often two years of struggle, pivot and development, and we consolidate that into 13 weeks and help these entrepreneurs connect with the community, investors and strategic advisers," Reuter said.

Levy was recommended to Techstars by another managing director in the accelerator’s network before Techstars internally announced plans to look at Des Moines for a location, Lopez said. Levy previously served as the interim director at the Iowa AgriTech Accelerator during the 2019 cohort, and has been an entrepreneur-in-residence for the accelerator. She is the founder of KNLWorks and has worked for Kemin Industries, Technomic Consultants, the Boston Consulting Group and two e-learning startups based in San Francisco.

"I feel comfortable in the broad tech space. I think there is a lot of opportunity in Iowa in broad tech, and I think we can leverage so much of what's already been created in the startup ecosystem and work together to enhance it," Levy told the Business Record.

The program manager will coordinate day-to-day activities and support for startups during each class duration. That position has not yet been filled, but will be filled at least two months before the first class arrives in Des Moines, Levy said.

"My role is to find the companies -- to make sure that our pipeline is fantastic, and that we pick the best 10 companies to come through," she said. "My role is also to ensure that we have the investors and opportunities on the back end of the program who are ready to work with these companies and truly help them accelerate to the next level."

Grinnell and Techstars are seeking additional partners to bring support to the Techstars Iowa program. Interested parties may contact Levy at kerty.levy@techstars.com.

"If this is a really successful accelerator, hopefully we have everybody in town that you can think of, corporations and otherwise, wanting to put money into this and support it," Thayer said.

"We are definitely playing the long game. This is not about short returns or short-term gains," Lopez said. "Ideally we continue to build and stay in Iowa for the long term."

$6.7 million price tag for Project Bluejay land, records show

By Kathy A. Bolten | Senior Staff Writer

Ryan Companies US Inc. paid 14 Bondurant landowners more than $6.7 million for 169 acres on the site where the mysterious Project Bluejay will be located, online Polk County Recorder's Office records show.

Speculation is that Amazon.com is building a fulfillment center on the site located east of U.S. Highway 65 and north of Northeast 62nd Avenue.

City officials have declined to comment, saying they’ve signed nondisclosure agreements. Officials with the Minneapolis-based Ryan Companies, which has offices in Des Moines and is overseeing the Bondurant project, also declined to comment.

However, according to the company’s website, Ryan built an Amazon fulfillment center in Shakopee, Minn., in 2016, delivering the project ahead of schedule.

According to Polk County records, Ryan bought the 169 acres from the following landowners: Susan Ugulini, Michael Ugulini, Jeffrey Frakes, Joshua Frakes, Mindy Frakes, Ladene Eshelman, Audrey Eshelman, Annette Justice, Gary Justice, Alicia Adkins, Jeff Adkins and the Douglas Eshelman Revocable Trust, the Herman Fortner Family Trust and the Herman Smith Fortner Family Trust. The transactions were recorded on Oct. 16.

Ryan paid nearly $40,000 an acre for the land, more than three times what the average price of agricultural land is selling for in Polk County, according to the Polk County Assessor's Office. Ag land in eastern Polk County has been sold for an average $10,280 per acre; ag land in the western half of the county, $9,6664 per acre, records show.

The Bondurant City Council in September approved a site plan for the $250 million project that includes a five-story, 780,000-square-foot warehouse/distribution/fulfillment center and more than 2,000 parking spaces. The project is expected to create at least 1,000 jobs, most of which will pay $15 an hour.

In October, the Iowa Department of Transportation Commission approved a RISE (Revitalize Iowa’s Sound Economy) grant of up 60% of the eligible costs to make improvements to 32nd Street S.W. and Grant Street S. The estimated cost of the improvements is more than $12 million.

The city of Bondurant issued a grading permit this month and work on the site has begun.
State and city documents indicate construction will be completed by July 2021.

It’s been quite a run in the past few years at DART, the Des Moines Area Regional Transit Authority.

There was talk of a train-like bus service, bus rapid transit that had a lot of support but couldn’t get off the ground. There were several major updates to its long-range planning, and the agency is getting ready for another.

Every time area residents are polled about what they want, it becomes clear that the transit system and mobility efforts in general aren’t delivering everything young adults and other commuters want. Some cities withdrew from the agency. The board was revamped to improve suburban representation. Read more

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Carrot Cake, Portfolios, and Recipes that Deliver!

KENT KRAMER, FOSTER GROUP
CFP®, AIF®, Chief Investment Officer

I confess, I love my wife’s carrot cake recipe! She makes it for my birthday every year. The recipe results in a cake that is moist, and the frosting is so creamy that even a non-frosting fan like me can’t resist it. Importantly, based on my tastes, the cake does not contain any nuts. To some folks, that’s carrot cake heresy; to me, carrot cake heaven. > FULL ARTICLE

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