Tuesday Nov 13, 2012 by Kevin Walther - Communications Officer, IDEA: Northeastern's Venture Accelerator
With many of the country’s predominant entrepreneurship institutions located right here in Boston, Northeastern University has transformed in recent years into an entrepreneurial empire. Just last month, the university announced the naming of the D’Amore-McKim School of Business after two alumni donated $60 million for business endeavors. Through the hustle of Northeastern’s business savvy campus, IDEA: Northeastern’s Venture Accelerator is making headlines this year as one of the most successful student-run accelerators.
IDEA is a university program dedicated to providing coaching, resources, and funding to student, alumni, and faculty created ventures. Six undergraduate students founded the program in 2010 to find a way for the Northeastern community to jumpstart businesses. To date, IDEA has provided support to more than 250 venture concepts and has funded grant money in excess of $200,000.
“IDEA offers an unparalleled opportunity for students, faculty, and alumni ventures and a guided experience through the challenging process of starting a company,” says Faculty Advisor Dan Gregory, who has helped create what the program is today. “It is experiential education at its best. Entrepreneurs wanting to learn the best way to develop a venture will get that opportunity by working with IDEA.”
Today, IDEA is comprised of over 100 ventures, representing varied industries including, but not limited to, biotech, retail, B2B software, and mobile apps. The accelerator currently has seven Launched ventures, which signifies that a business is either self-sustaining or has received significant funding from outside investors.
This year alone, IDEA will grant over $240,000 with its Gap Fund and Prototype Fund. This has attracted huge attention not only from the university, but large media outlets such as MSNBC’s ‘Your Business’, Forbes, and The Boston Globe.
The Gap Fund is one of IDEA’s signature programs designed to help launch ventures into successful businesses by providing capital. After working with IDEA for at least a month, ventures can apply for up to $10,000 per round by submitting a detailed plan on what they’ve accomplished, their outlined goals, and how Gap Funding closes a gap in their business. Identifying ventures to receive funding is one of the toughest tasks IDEA’s Investment Committee has to accomplish.
“We aren’t just giving money for the sake of giving it away. We want ventures to have a sustainable plan because we are funding these businesses with alumni-donated funds,” says IDEA’s Investment Officer Matthew Saitta. “Our biggest challenge is making sure we are funding the right ventures.”
The Gap Fund isn’t just a means to provide non-equity grant money to businesses. As Saitta explains, the Fund is equally a constructive learning experience.
“We are funding ventures that we anticipate are going to be successful. If they succeed, we are successful, but if they fail, we need to make sure that they learn from those failures. Our return is a function of the success of the venture and experiential learning. We want our Gap Funding to be a win-win.”
Service Providers also add to the growing list of resources available to ventures. IDEA has partnered with more than 20 companies including Goodwin Proctor, famaPR, and Accounting Management Solutions to provide in-kind benefits. Once ventures reach a certain level of development, they are eligible to consult and work with any firm free of charge.
IDEA sets itself apart from the field in another major way: it’s completely operated by students.
“The students who are part of this team make IDEA vastly different from other student accelerators,” says Northeastern senior and IDEA CEO Christopher Wolfel. “We have a group of students doing this not for pay or for credit, but to make a difference for others and help our ventures succeed. The students make the decisions, set the direction, and have a real impact on this organization.”
IDEA’s Management Team is composed of 18 students representing nearly all of Northeastern’s academic schools. Each team member is chosen from their field of expertise, whether that is investment and finance, event planning, marketing and communications, or operations. Each day, the team works tirelessly approving ventures for funding, planning workshops with industry professionals, and recruiting students to turn their ideas into functioning businesses.
While the ventures’ success is a key component of IDEA, it wouldn’t be possible without the hard work and support from the Management Team. The entire group is dedicated to the entrepreneurial community IDEA is building.
“Being part of the growth and contributing to the continued development of our ventures has been a priceless experience,” says Saitta, who has been on the Management Team for two years. “Our diverse and incredibly skilled team is becoming more efficient while scaling up. The key is that we too remain entrepreneurial. This mind set supports a tailored approach that successfully provides maximum acceleration to ventures of all shapes and sizes and I look forward to the future we are putting in place.”