Newest Austin Startup Accelerator Sputnik Plans January First Class
Austin—[Corrected 9:56 a.m. See below.] There’s no shortage of startup accelerators in Austin, with stalwarts like Capital Factory, Techstars, and the Austin Technology Incubator often getting the most attention.
To be fair, there’s no shortage of early stage startups, either, which may be part of the reason more accelerator programs have launched in the city in recent years. The International Accelerator was created in 2015 and, more recently, MassChallenge opened its first Austin accelerator in October, which was directly followed by two new Techstars programs.
Sputnik ATX is now the newest accelerator to open shop in Austin, and it is currently accepting applications for its first class of startups. The deadline to apply for joining the program is Dec. 25, and the accelerator’s partners plan to select three to five companies for its first class by late January, when its 12-week session will begin.
Sputnik was co-founded by Oksana Malysheva, a Ukrainian-born physicist (she studied experimental condensed-matter physics, if you’re interested in a little research for a talking point), who came to the U.S. with her Russian-born husband for their Ph.D. programs (he studied astrophysics). Malysheva spurned traditional research for the business world, first at McKinsey, then Motorola, where she says she led marketing for the launch of the once ubiquitous Razr cell phone.
Eventually, Malysheva began investing in startups, which turned into her full-time job through a firm she created, Linden Venture Fund. Joe Merrill, who previously worked in the public sector as a diplomat and then for Apollo Global, joined her at Linden in 2014. Together, Malysheva and Merrill came up with the idea for Sputnik. [Corrected to accurately reflect Merrill’s previous employer.]
Sputnik is framed in the likeness of Silicon Valley incubator Y Combinator, Malysheva says. Sputnik provides $100,000 in funding to companies that are accepted, which is in exchange for future equity if the business gets further funding. (More on how that works here.)
The program plans to focus on product development, using a network of executives and investors to mentor the startups that join it, Malysheva says. The accelerator will focus on selecting startups from Texas cities, such as Austin, Dallas, Houston, and San Antonio, and will require that at least one founder live in Austin during the 12-week program.
“What we’re going to teach our startups on product development is that you nail it before you scale it,” Malysheva says.
Sputnik isn’t going to restrict the type of industry a business can focus on, though she says they don’t want companies with products related to drugs, alcohol, fast food, or franchising. The startups also must already have a product that has at least one paying customer, she says.
“We are aspiring for these companies to make a huge leap in development,” Malysheva says. “By the virtue of requiring that our companies are makers, I am guessing they will be weaker in marketing, social media, and I think we’re very well equipped to help them in that area, given our background and the network that we have.”
The accelerator program officially launched in October, which was about two years after Malysheva moved to Austin with her husband and children from Chicago. She and her husband, Misha, who is the CEO of Austin-based quantitative trading firm Teza Technologies, decided to make the move to Austin because of the access to entrepreneurs, tech talent, and because it is a lot warmer than Chicago.
“My husband got a flat on Christmas, and he needed to change the tire at minus-10 degrees Fahrenheit on Lakeshore Drive,” Malysheva says. “We looked at each other and said, ‘We’re entrepreneurs. We run our own companies. We could live anywhere. Why are we here?’”
The accelerator will enroll a second class later in 2018, and may increase the size to 10 startups, Malysheva says. They are keeping the first group smaller to work through any kinks, she says.
Malysheva admits that she won’t know for sure whether there are enough quality startups to fill all the accelerators in town, at least until later in 2018. She says she has already received strong applicants.
“We will not write a check just to fill the numbers,” Malysheva says. “Being a startup entrepreneur is insanely mentally tough. This is not where you go if you just want to get rich because there are quicker and easier ways to do that. … To me, it’s almost like falling in love: There is no other choice but to pursue it.”