LightSpeed’s mission is to inspire, enable and propel the next generation of aerospace companies and build up the community to create a competitive and thriving start-up ecosystem.
Name of Accelerator: LightSpeed Innovations
Location: Southern California with nodes in Los Angeles, Orange County and San Diego
Managing Partners: Ellen Chang & Monica Jan
This article is part of our Startup Accelerator Spotlight Series featuring accelerators from around the world. We hope these spotlights will assist the entrepreneur should they consider attending an accelerator program.
In two sentences or less, tell us about your accelerator and its objectives.
LightSpeed Innovations is a business accelerator formed to mentor and invest in innovative, disruptive intelligent aerospace/hardware startups. Our mission is to inspire, enable and propel the next generation of aerospace companies and build up the community to create a competitive and thriving start-up ecosystem.
Why is your accelerator program unique? Please describe the benefits of participation in your program.
We curate our cohorts of up to 10 companies along themes – space, drones, analytics, connected vehicles and autonomy. This has created an environment that enables the different companies to learn from each other, share leads, deals and explore the markets they are addressing. Our programs are 4 months long, but we remain involved and continue to hold meetings/calls/visits beyond graduation. This ensures startups have the long term support they need. Four months a startup does not make.
We invest on the backend of the program; similar to Techstars, we invest at a larger level in a a select number alongside the seed round. We don’t take equity, rather align along revenues. We take equity from companies we invest in. Our investment rate is approximately 1 out of every 8-10 companies. We target super early, pre-revenue companies that are enabled by software AND hardware. Our focus is intelligent aerospace – broadly inclusive of AI/VR/AR/Analytics AND the platforms that so define the industry.
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What is the most difficult part of working with startups?
- Startups have a ton of competing priorities.
We fight to get attention and provide the requisite mentorship and connections to get the startups to revenues.
- The markets they are in.
We tend to work with and invest in emerging markets, which themselves are undefined. This adds complexity on top of the fact that a company is just starting up.
- Lack of cash.
Startups are not cash rich and therefore cannot spend $ on whatever they want. It can be challenging and frustrating because the PR campaign could not be as large as we would have liked or the startup wasn’t able to make as large an investment in development of the product. This paucity, however, instills creativity and resourcefulness and as a collective, we have gotten much further than having cash could have provided. It’s this challenging environment that brings out the best minds, the most innovative thinking.
What do you enjoy the most; what do you find most appealing about working with entrepreneurial startups?
What I enjoy the most is seeing the founding team blossom, execute and get traction. For some, it takes longer than others. We also like the challenge. As mentioned previously, an austere environment often results in more creativity, better thinking and greater focus on the things that truly matter. We want to build capability and capacity in the founding team and we want to collectively make money. Our vision is to create successful entrepreneurs who will become successful investors in the intelligent aerospace ecosystem.
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Tell us about your success stores; which are the most interesting companies to have participated in your program?
We have been around less than two years, but I have been investing for the past seven years. Our first cohort has done phenomenally, having raised their seed round, and the other cohorts are on their way. We have been able to grow our investor network from just over 20 to over 75 and it continues to grow. All 17 companies that have come to our program are still in operation and we continue to work with all of them.
What are the three most important factors startup entrepreneurs should consider when contemplating attending an accelerator?
- Alignment in Expertise.
For some companies, it is important to grow and build with others in the same sector. Learning through accelerators beyond the business curricula. We have had great success when drone companies work with drone companies and space companies with space companies, provided they are not competitive, of course.
- Mentor Program.
We work to pair up one to two dedicated mentors per startup who will support the startup on a weekly basis. We also surround the startup with an extended network of advisors who could be available on a one-off basis. We have established this approach based on feedback from startups who have gone through other programs, and based on lessons learned from Steve Blank’s Lean Launchpad.
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- Long Term Relationship.
Startup success is not built within a 3-6 month timespan. How does the accelerator support its graduates? What programming, events and mentoring are there to take advantage of?
What else would you like to share?
Our approach includes growing the support of private investors as well as corporate investors. We proactively build relationships not just venture capitalists who are interested in our domain, but also the corporations like Boeing, Lockheed, Northrop and other such firms who would provide a fertile ground for our startups to sell to. These companies could also become the acquirers of aerospace startups.
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