A lot’s happened in the nine months since Slingshot launched the NRMA-backed Jumpstart accelerator program; four of their graduate startups received follow on funding, the Slingshot Venture Fund successfully qualified for tax-exempt status, and they have launched an online Bootstart program with Silicon Valley author Ash Maurya.
As Slingshot begins taking applications for Jumpstart’s second intake, we thought we’d take a closer look at Australia’s newest corporate accelerator program.
Officially launched last October, the Jumpstart program is run by Slingshot and sponsored by NRMA, which provides 2.4 million customers, arguably the program’s biggest draw, and the opportunity for follow-on funding (which graduates caravan rental group Camplify and homecare platform Careseekers are set to receive).
Unlike their smaller scale-up program, Jumpstart Accelerator requires participants to move to Slingshot’s co-working spaces in Sydney. While NRMA’s immediate contribution is limited to their customers and four program themes (“Mobility and Connected World,” “Family and Communities,” “Digitise our World,” and “Safety on our Roads”), the $30,000 in seed funding comes from the Slingshot Fund.
“They get all the benefits of a traditional accelerator program with the additional benefit of access to a large customer base, and you know that customer base, because of the themes, is interested in the sort of product you’re developing,” Slingshot founder Craig Lambert said. “The customer base is there to test and learn on the way through, to help you validate, and to help you monetise your outcome if you can prove that validation.”
In return, Slingshot gets 10% equity in the accepted startups, which is 3% higher than what we have come to expect from accelerators. This means if you’re choosing between Jumpstart and, say, Startmate (which takes 7.5% in return for $50,000) you will have to decide if access to NRMA’s customer base is worth the difference – for example, Careseekers’ Marissa Sandler joined the program because of the synergy between their respective customers.
Another graduate, the gaming social network Gamurs, successfully secured a $350,000 in seed funding in April. The first cohort also included pocket tour guide WunderWalk, voice recognition and car safety tech OTTO by Gizmosis, and remote aerial monitoring drone platform Hive UAV.
Feedback from participants has been positive, but Lambert acknowledged the program’s dual physical and emotional toll.
“From a personal perspective, I don’t think I’ve had a more rewarding role ever,” Lambert said. “And I’m someone who’s worked in corporates and managed large teams, and personal development with staff is something I’ve always found rewarding.”
“This is a different level because of the risk everyone’s taking,” he said. “They might be leaving jobs, they’re leaving their families sometimes to relocate…it’s easy to say you want to be an entrepreneur, you want to run your own business, but mate, holy cow, it’s hard.”
On top of running corporate accelerator programs like Jumpstart, Slingshot has run a separate Newcastle and Sydney-based accelerator program and finished up its second round of intakes last year. On top of Jumpstart’s seed funding, co-working spaces and mentoring program, Slingshot also provides the opportunity for further co-investment.
The team are currently conducting their nationwide roadshows for round two of Jumpstart, and, following a successful day of judging at Startup Weekend Brisbane, Lambert said the group is looking for Brisbane corporates as future clients.
“I can really sense there’s this collaboration going on in South-East Queensland,” Lambert said “Everyone is trying to move in the right direction, there’s not a sense of competition there’s a sense of collaboration. We actually want to be a bigger player in this market, so we’ll look for a corporate in Brisbane to help us do that.”
Slingshot Accelerator is in turn run by the $10 million Slingshot Venture Fund, which is managed by Artisian Venture Partners (which manages a host of other funds, including the ilab Venture Fund) and last month became the thirteenth Australian venture fund to be awarded unconditional Early–Stage Venture Capital Limited Partnership (ESVCLP) status.
ESVCLP can be awarded to funds between $10 million and $100 million, and means Australian investors will have no tax liability on income or capital gains received from the fund.
“We love the fact that the fund’s purpose is to seed and get them going, so we love our role,” Lambert said. “And secondly, because the fund’s big enough that when we get a good [startup], we can actually help them continue the journey by co-investing – it’s a really good strategy.”