I’ve been wanting to write about the rise of the indie movement when it comes to startups for a while, and that post will come. For now, it’s happening in a backward fashion as I discuss non-equity accelerators first.
There are a few types of startup accelerator programs for founders: traditional equity-based ones, such as Y Combinator, where if your application is successful – you receive a $120K investment for 7% of your company. Or paid accelerator programs such as Springboard, where you pay $5000 to take part in the program. Other programs may offer investment in exchange for equity but then require some of the funds to be returned for services rendered and/or coworking space. And then there is the rise of non-equity based accelerator programs that offer investment without equity or program costs – effectively a grant.
The number of non-equity based accelerator programs has risen in the past few years. This has occurred in areas outside of Silicon Valley – and is largely due to governments wanting to stimulate their economies and invest in building their local tech ecosystems. The Chilean Government was one of the first to popularize these types of programs via Startup Chile. Startup Chile’s Seed program grants companies $40K along with working vias in order to be based in Chile for six months. There are bunch more programs now and Lootstrap has a comprehensive list of equity-free accelerators here that’s worth checking out.
The Queensland Government was the first State government in Australia to launch such a program with Advance Queensland’s Hot DesQ program. I originally heard about the program at an Australia Day event we hosted through the Aussie Founders Network in Silicon Valley. I’d already raised $1M+ angel round for my company CloudPeeps, and while I was interested in alternative funding options from there on in, I didn’t think the Hot DesQ program would be for me. At that stage, I’d been in the US off and on since 2010 and had originally left Australia because of a lack of investment opportunities, senior talent, and an established tech community. The press called it the great talent ‘Brain Drain’. It wasn’t until my friend Holly Cardew of Pixc, a fellow Aussie and marketplace founder, referred me to the program that I really looked into it.
Hot DesQ offers startups up to AUD$100K of equity-free funding to move to Queensland for six months and beyond. Queensland is without a doubt Australia’s most stereotypically beautiful state and the most like what people expect when they picture Australia: sandy beaches, turquoise oceans, tropical rainforests, year-round sunshine, vast landscapes, and super-friendly people. The Hot DesQ program is focused on three types of founders: early-stage entrepreneurs, Aussie expats (sometimes called “Boomerangs”), and established startups looking to expand into Asia-Pacific. There are some expectations associated with receiving the grant, which includes things like advising other founders, hosting or speaking at events, hiring locally, and facilitating introductions and connections. These expectations are measured in a series of milestone points that must be accrued monthly in order to receive installments of the grant.
After hearing Holly speak highly of the program, Mat and I decided to apply and were successful with our application. You can read more about the announcement here. We were ecstatic to be accepted and recently spent six months in Brisbane, based out of Fishburners coworking space. After spending more time back in Australia, it was excellent to see how much the ecosystem has grown and how much the government is supporting entrepreneurship. The quality of the Hot DesQ cohort was also insane – serial founders who I’d known from the US such as Nikki Durkin (founded 99dresses), Chris Raethke (founded Bugcrowd) and Marita Cheng (founded Robogals) were part of the second cohort, alongside some people working on some hard tech challenges in agtech, crypto, robotics, VR, crowdfunding and more.
I haven’t had much a breather to reflect on Hot DesQ but I do know that it completely exceeded my expectations and I would recommend any founder apply. I’d love to do it all over again – especially with a new product where the funding and six months timeframe would be monumental If you’re building a new product or expanding into Australia – apply. Richelle and the Advance Queensland team are great to work with – and committed to the growth of the community for the long term. Plus, things happen fast and with little bureaucracy.
Applications for round three of Hot DesQ are open now until Wednesday 19 September 2018. For more information, visit www.hotdesq.com.au. If you’re interested in applying and would like a referral, shoot me a note via my contact page. I will also be reviewing applications as part of the assessment panel.
All amounts are in USD unless started.
Search #HotDesQ on Twitter and Instagram to check out more updates from the program.