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500 Startups Announces First Class Of New Incubator Program

February 10th, 2011 02:06 admin Leave a comment Go to comments

Six months ago 500 Startups, the angel fund headed by Dave McClure, started investing in dozens of startups — they’re now up to around 90 investments. And today the fund is announcing an incubator program similar in many ways to Y Combinator, TechStars, and the numerous other programs that have popped up to support fledgling tech startups.

As with these other programs, 500 Startups is giving each company some seed funding and access to a roster of mentors, in exchange for a chunk of equity. McClure says that in general these startups are receiving between $25-100k for 5% of equity, with the median around $50k (this is more than Y Combinator, though 500 Startups doesn’t have the sweet $150k Start Fund deal). The program lasts for 3-6 months depending on how long each company wants to stay, and McClure says they’ll probably run three batches this year, each with its own Demo Day to showcase the startups to investors, the first of which will be in early April.

McClure says there are a few other structural differences: 500 Startups is willing to accept companies who have already raised funding from other investors, and he says it’s “follow-on friendly” in that 500 Startups is willing to participate in funding rounds for companies that have completed other incubator programs.

500 Startups will be charging each company that participates in the program for desk space at $1,000 per founder per month (which they’ll pay for using some of the money they received upon entering the program). The program has one design and oneUX expert on staff, and participants will have access to other mentors as well.

Finally, McClure says that the program is going to have a big emphasis on distribution platforms like Facebook, Twitter, Google, and YouTube.

Here’s the list of the first 11 companies to participate in the program (that’s one other difference — startups can choose to stay stealthy before Demo Day if they really want to, but they’re encouraged to be more open than in some other programs):

Here’s a video of the office space:

Source: 500 Startups Announces First Class Of New Incubator Program

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