Eight startups receive inaugural loans from city program
June 2, 2014
The Reno Accelerator Fund is making its maiden loans to eight startups, businesses ranging from a developer of decision-making software to a boutique brewery.
The fund was established earlier this year by the City of Reno through its annual, $200,000 U.S. Department of Housing and Urban Development community development block grant.
Each chosen business will receive a $20,000, five-year loan with 3 percent accruing interest, which can be repaid at any time before the end of the loan's term.
The eight recipients are American Duchess, a manufacturer of historic reproduction shoes; B Heard, developer of a social action and advocacy application; Boot Roxx, maker of cowboy boot covers; EasyKeeper, a developer of herd-management software for goat herders, which is relocating from the San Francisco Bay Area to Reno; inqiri, developer of an online decision-making application; Looksie, maker of a just-in-time spa/salon appointment booking application; Sierra Delectables, a mushroom producer; and Under the Rose Brewing Co., a small brewer with product already on the shelves of Whole Foods Market.
The eight businesses were chosen from 36 applicants by a committee consisting of a representative from the city, one from the Economic Development Authority of Western Nevada and another from the Nevada Small Business Development Center at the University of Nevada, Reno, College of Business, says Nicola Kerslake of NewBean Capital, who is under contract with the city to manage the fund.
To apply, a business had to be affiliated with one of Reno's accelerator programs because startups in such programs, which provide mentoring and guidance, perform better, says Kerslake.
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Just over half the applicants were working with C4Cube, 37 percent were associated with the Reno Collective and 11 percent worked with Girlmade.
Kerslake says the criteria for selecting the recipients included strength and background of the business team; whether the startup had already gained traction and had an existing customer base; and potential for growth, particularly in bringing new jobs to the area, the ultimate goal of the fund.
According to Kerslake, the eight businesses have already created 10 new jobs and are expected to add another 15 by year end.
James Elste, cofounder and chief executive officer of inqiri, plans to use the loan to help add two full-time positions, preferably filled by UNR grads. The software startup was founded in December 2012 by Elste and Travis Schwieger, its chief data architect, and already employs four people full time and one person part time.
The business launched its product, a collaborative tool for making organizational decisions, nine months ago and has a couple thousand users on its publicly-available service and in beta with several, paying customers. (The company is currently demonstrating its technology through an inquiry examining who is the best candidate for Reno mayor.)
"I think the Accelerator Fund is a great idea," says Elste. "Reno is very supportive. It's a very exciting time to be part of the Reno start-up community."
American Duchess already has a customer base, including the Metropolitan Opera in New York, but the Reno startup has been hampered by working on a per-order basis. So Lauren Stowell, who started the shoe manufacturer about five years ago, is using her loan to build inventory so the business can work in advance rather than as orders come in.
"I'm trying to shift my business model from being crowdfunded to more retail, seasonal orders," says Stowell. "Takes a little different kind of work for me to know what's going to do well, but it's a more stable business model."
Besides that, the loan will give her some peace of mind, says Stowell.
"We're going into summer, which is a slow period," she says. "Now, I don't have to freak out as much."