Grinnell College is putting up an undisclosed amount of money over the next three years to support a Des Moines-based business “accelerator” — and help up to 30 entrepreneurs take their start-ups to the next level.
“We know that great ideas are not only born in California and New York and the partnership we announce today is about supporting those great ideas born and grown right here in this state,” Jainen Thayer, Grinnell’s chief investment officer, said this morning during a news conference at Dwolla headquarters in Des Moines.
Grinnell’s partner is “Techstars Iowa.” The Techstars organization has more than 50 locations around the world that help entrepreneurs connect with mentors and investors. Kerty Levy was hired this week to be managing director of Techstars Iowa.
“I look forward to working with the next generation of entrepreneurs,” Levy said during today’s news conference. “I also look forward to matching them with excellent mentors, helping guide them through the challenges they’re facing and really prepare them for growth in the next phase.”
Up to 10 Iowa entrepreneurs will be selected for Techstars’ first 13-week program in Iowa, to start in September of next year. Each will be given $20,000 in cash for their business, along with the opportunity to secure a $100,000 loan. Claudia Reuter, managing director of Techstars, said the concept was launched 13 years ago and entrepreneurs who go through the program are more likely to see their start-ups become a success.
“Right now, in typical venture investing, one out of 10 companies maybe survives or thrives,” Reuter told reporters. “In Techstars companies, we have over 85% of our companies that are active or have been acquired.”
The owners of more than 1900 companies have participated in Techstars’ business accelerators. Techstar is currently partnered elsewhere with organizations like the U-S Air Force and businesses like the tool-maker Stanley Black and Decker to support entrepreneurs. Thayer, the chief investment officer at Grinnell College, said Techstars Iowa will help create a stronger “start-up economy” in the state — but Grinnell expects to reap income from the investments it makes in these new businesses.
“The endowment is very important in terms of funding the operations at Grinnell,” Thayer said, “and so, first and foremost, this has to be a good investment.”
Recent estimates indicate Grinnell College has a $2 billion endowment and it finances about 55 percent of Grinnell’s operating budget.