Business Incubator Series: Interview With Kerry Rupp, Managing Partner, DreamIt Ventures – Philadelphia And New York City (Part 6)

By guest authors Irina Patterson and Praveen Karoshi

Kerry: Scvngr is our best-known company. They are a mobile game platform that is used both in the B2B space, in that museums and cities can host Scvngr hunts for residents who can explore a community, and also a consumer game, where users can check in at different locations, compete in challenges, and earn the rewards from local business for frequenting them and participating in gaming events around their location.

We have several other companies that are all interesting and have been funded and are doing great things, so I could keep going …

Irina: Do you engage with the companies after incubation?

Kerry: We do, but it is in a less formal way. So, in the past three years, as we have been progressing, we are obviously developing a strong base of alumni. What we are doing is bringing them back into the program. We have an active internal Facebook group in which all the alumni participate. I would say that we have up to 10 posts a day where the alumni are working with one another, getting advice on how to do certain functions, how to reach someone, share their news, get hiring help, that kind of thing. We stay very engaged with that group.

Those alumni are now coming back and helping our newer companies. So, each year, our alumni companies come back and do either speaking events or more one-on-one mentoring sessions with the companies and make themselves available for advice and direction.

We leave it up to each alumni company to how deeply they want to get engaged with us.  In some cases they are very connected to a certain partner for certain advice.

So, for example, when Scvngr was raising its most recent round – it just raised $15 million – management was on the phone daily with our partner, David Bookspan, who helped them to negotiate and position the company for that investment opportunity. We often do that in areas where we each have different types of expertise.

Irina: Do you have any strategic partners?

Kerry: Yes. Obviously, all these companies that donate their services to the DreamIt entrepreneurs are in some way strategic partners, all the law firms and accounting firms and so on. But, the most important partner for us is a nonprofit organization called Startl, which is funded by several major foundations [the John D. & Catherine T. MacArthur Foundation, the William and Flora Hewlett Foundation, the Bill and Melinda Gates Foundation, the W.K. Kellogg Foundation, and the Lumina Foundation].

Startl’s charter is to start innovation in learning and education, so we work together to bring in some of the companies that are in that space. For example, in the summer program in New York City, five out the 15 companies that we bring in would be in conjunction with Startl, and they will be digital education companies. This is the second year of our partnership with them; we did four companies in Philadelphia this past fall.

Irina: What is your accelerator’s business model? How are you funded?

Kerry: For our Philadelphia program, much of our funding is public funding. Our past funders there have been the Pennsylvania Department of Commerce and Economic Development [DCED] and the Ben Franklin Technology Partners, which are also funded by the DCED.

They are both elements of the Pennsylvania government that are focused on driving economic growth. The other funder in Pennsylvania is the University City Science Center, which is the largest and oldest urban research center in the country. [It comprises 32 nonprofit shareholders, including many of the colleges, universities, hospitals, and research institutions located throughout Pennsylvania, New Jersey, and Delaware.]

Their incubator essentially helps commercialized technology that is coming out of those destinations. That is where DreamIt is housed in the Philadelphia program. So, they are all the limited partners in our fund. We will receive proceeds of the fund when we have exits.

In New York City, we are going with private investors. We are very focused on angel investors, and we are just closing the details with those angel investors.

Right now our operational costs are funded by those investment funds and by our limited partners, until we have some exit events from our portfolio companies. And, when we do a partnership with an organization like Startl, there are funds that come in from Startl to help with the accelerator’s operating costs.

This segment is part 6 in the series : Business Incubator Series: Interview With Kerry Rupp, Managing Partner, DreamIt Ventures – Philadelphia And New York City
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