New Head of Techstars in Austin Prepares for First Class
Amos Schwartzfarb is only a few weeks away from the start of another Techstars program in Austin, TX, but this one is a bit different for him.
A co-founder and executive of multiple companies, including Austin’s BlackLocus and Joust Inc., Schwartzfarb has been a mentor at Techstars since it started in Austin in 2013. When the newest class of Techstars companies is unveiled in February, Schwartzfarb will be making the announcement. He joined the Boulder, CO-based company as the managing director of the Austin program in August.
Austin is one of 22 cities globally that operates a Techstars accelerator program for startup businesses, offering an intensive three-month boot camp for companies seeking coaching from experienced mentors and Techstars staff. In exchange for a 6 percent equity stake in the company, Techstars offers the selected businesses a $100,000 convertible note, office space for the three-month program, and $20,000 for living expenses, among other perks.
For Schwartzfarb, the opportunity to run the Austin Techstars office was based partly in two things: his interests in teaching and in investing. But it only became an opportunity because Jason Seats, who launched the program in Austin, was shifting his role in the company toward investing. Seats is now a partner at Techstars Ventures.
“This role is sort of what I’ve been working towards my entire career, though I’d never have anticipated this is where I’d end up,” Schwartzfarb says. “When the opportunity came up, Jason and I were just sitting and talking about it. It clicked.”
Before Schwartzfarb co-founded Joust, a social engagement platform, he worked for BlackLocus, a company that provides pricing data to retailers. It sold to Home Depot in 2012. Schwartzfarb moved to Austin eight years ago after helping sell Business.com as a member of the executive team to RH Donnelley in 2007.
With his first class of Techstars companies, Schwartzfarb says he is trying to maintain the same level of quality that Seats brought to the program. In the last week, he has sent the last few offer letters to companies he hopes will join the 2016 class. Techstars plans to announce the new group, expected to be 10 startups, to the public on Feb. 15. After the three-month program, the companies will have a demo day on May 19.
While it’s possible that there may be more Austin-based companies than in 2015—Schwartzfarb estimated that about 30 percent of the companies last year were from Austin, while around 50 percent may be this year—a prospective company’s location is the last thing on his mind, Schwartzfarb says. “We want the best companies we can get that we’re excited about,” he says.
Not all of the companies have been started by brand new executives, either, with a couple of the companies joining with “seasoned leaders,” Schwartzfarb says.
“The tides have risen,” he says. “If I’m a serial entrepreneur and I’m starting a company in an area I don’t know a lot about, and I can quickly accelerate my business because of the network, why wouldn’t I take advantage of that.”
The Techstars program also offers a guarantee to return some or all of the equity if a company feels it didn’t get the value it wanted from Techstars, he says. “It’s all on good faith. There’s been two examples of discussions [about getting equity back] out of 700 companies globally,” Schwartzfarb says. “Typically if you ask a Techstars founder, they say, ‘I would have paid more.’”