Sarasota-Bradenton entrepre-neurs and executives have lamented for years that the business community lacks gazelles.
Dan Miller and Chris Abbot, who have independently started and sold several local businesses, from a mobile phone marketing company to a property management firm, want to alter that perception. Miller and Abbot are two of the founders behind the Abbeton Accelerator Fund, an innovative local business investment pool.
“This isn’t about investing in companies,” says Miller. “It’s about investing in ideas.”
The concept is modeled after successful accelerator and seed funds launched in Vancouver, Canada, and Silicon Valley. The hook is an accelerator fund, in this case comprising Miller, Abbot and a third partner, Charlotte County businessman Todd Rebol, and it isn’t run like a venture capital fund.
Accelerator fund managers are more like startup godfathers — experienced entrepreneurs who provide new businesses a combination of expertise, advice and, of course, money.
Moreover, on the money side, the Abbeton Accelerator Fund won’t merely cut a check and move into the background to await a return on its investment. The fund will instead purchase or create tangible items the startup needs. For example, if the startup needs a server, the fund might buy it or find and pay people to build it.
Local business people, from attorneys and accountants to senior executives, have backed the Abbeton Accelerator Fund with investments of $10,000 and up. Abbot says the fund is capped at $200,000. It will invest no more than $20,000 apiece in 10 startups in the idea stage, with a focus on technology, software and cloud computing. Miller, Abbot and Rebol will select the businesses.
A company must meet eight basic requirements to receive Abbeton Accelerator Fund assistance. Requirements include: a concept with a regional or national audience; an idea with residual income; a concept that can make sales within the first month of development; and the ability to have a product or prototype ready for the marketplace for $20,000 or less.
Any company the fund backs must also be based in the Sarasota-Bradenton area. That point is key, says Abbot, so the fund can maintain control. “If a guy called us from Chicago with the most amazing idea,” Abbot says, “we wouldn’t invest in it.”
In return for the investment, the Abbeton Accelerator Fund will own at least 25% of the startup.
Overall, says Abbot, the accelerator fund tweaks the venture capital model by closing the gap between risk and certainty. Abbot hopes to start a new Abbeton Accelerator Fund next year and in subsequent years, each with a fresh $200,000 split 10 ways.
“Unlike other funds that give money,” Abbot says, “we use our programmers and designers to actually create the product or technology so our investors know the money they invested will result in working technology.”
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