Most successful companies have started the same way: with someone having an idea. However, getting that idea from what’s called the “napkin stage” to market is often fraught with the kinds of pitfalls that cause half of small businesses to fail within the first five years, according to the Small Business Administration. No one knows this better than Launch NY, a nonprofit venture development organization that serves high-growth potential startup companies in the 27 westernmost counties of the state, which is why, in 2012, it started offering pro bono mentoring with its Entrepreneur-in-Residence program. This month, Launch NY marks a major milestone in logging over 1,000 companies that have utilized this program, which was developed based on nationally recognized best practices in order to connect Launch NY clients with experienced business professionals who provide one-on-one coaching, helping to prepare startups to raise investment capital necessary to grow their businesses.
“From basic mentoring from a handful of mentors starting in 2012, we have grown to more than 27 local, experienced EIRs today,” said Marnie LaVigne, Ph.D., president and CEO of Launch NY. “Through their expertise, combined with the addition of the National Mentor Network of 2,000 industry, business, and investment experts, our pro bono support brings a wealth of experience, guidance, and connections designed to make startups investment-ready. Our work is stemming the tide of companies that either died on the vine for lack of resources or left the region for more fertile communities.”
The EIRs assist entrepreneurs across all industry sectors using the globally recognized Business Model Canvas, an efficient tool that enables a startup to visualize, develop, and clearly articulate their business model to investors, customers, and others by meeting entrepreneurs exactly where they are in the startup process. Notable success stories include ACV Auctions in Buffalo, The Perfect Granola in Rochester, Ephesus Sports Lighting in Syracuse, and Ursa Space Systems in Ithaca, who all engaged with Launch NY’s EIRs in their early days.
“Now that we can pair mentoring with our expanding Invest Local financing programs making two to three investments per month, we can help even more of the region’s most promising entrepreneurs build and grow their new enterprises right in our backyard, shaping Upstate New York’s new economy,” said Lindsay Karas Stencel, Launch NY’s COO and fund manager.
EagleHawk One, a Buffalo-based commercial roof inspection company that uses drone-powered technology, was one of the first companies to receive investment from Launch NY’s new LP Fund and is also a member of Launch NY’s Emerging Cleantech Opportunity Incubator. EagleHawk utilized Launch NY’s mentorship services by first being pairing with Launch NY’s former EIR Dan Magnuszewski, co-founder and CTO of ACV Auctions. Today, the team works with Launch NY EIR Don De Laria, president of Larkin Express Logistics, who brought a wealth of experience from his time as an EIR for the Advanced Technology Development Center.
“EagleHawk has been a great team to work with,” said De Laria. “The founders are coachable and do their best to be prepared for meetings to make the most of my time and theirs. Their team is seeing success with revenue growth and were prize-winning finalists in the GENIUS NY competition this year,” he said, referring to world's largest business accelerator competition for unmanned systems. “They have a lot of potential and I look forward to their future success.”
In just two years, EagleHawk, which currently employs nine, has inspected over 1,000 roofs and 15 million square-feet of rooftop, while helping customers detect unknown issues, mitigate risk and reduce roof maintenance costs. Founders Patrick Walsh and Will Schulmeister are experienced drone operators with advanced degrees in engineering and geographic data science.
“EagleHawk would not be where it is today without the support of Launch NY,” said Walsh. “The coaching and the mentorship provided early on helped us position our business to raise capital. Then when we started to raise capital, Launch NY’s commitment was seen as a vote of confidence and helped us secure commitments from other angel investors. We feel very fortunate to be a part of the Launch NY family.”
After a startup receives at least three months of EIR mentorship, it can apply for funding through Launch NY’s Seed Fund, which was introduced in 2016 to serve the market and expand access to the much-needed early stage risk capital for startups in Upstate New York. Built by grants and donations with all returns coming back to the fund to support future startups, the nonprofit fund is the most active seed fund in New York state and one of the most active in the country, with over $2 million invested in 41 companies to date, with the portfolio companies, in turn, raising $23 million in working capital.
Launch NY’s Seed Fund is the cornerstone of the newly launched Invest Local Financing Programs, a new returns-based investment opportunities platform for accredited investors looking to make a profit while also having a positive impact on the Upstate New York entrepreneurial ecosystem and regional economy. Launch NY started making investments from its first for profit fund, the Launch NY Seed Fund I LP, earlier this year and launched the Investor Network Beta Test, the region’s first and only on-demand digital marketplace exclusively serving Upstate New York’s entrepreneurial ecosystem. The Investor Network provides open access to all accredited investors in the local ecosystem regardless of their geographic location, thus allowing expats or anyone interested in Upstate NY’s entrepreneurial ecosystem the chance to support a startup that shows promise, therefore positively impacting the surrounding economy.
“Downstate receives as much as 97 percent of the equity capital invested annually in the state, despite the incredible innovation in our region,” said LaVigne. “We have enhanced and expanded our services to help our clients get the leg up in a competitive environment. Now our current clients and the next 1,000 companies we assist will benefit from having our robust EIR program plus our Invest Local financing programs working in sync to help level the economic playing field for all entrepreneurs seeking to build their business in Upstate New York.”