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Evolver: An accelerator for social enterprises

Accelerators give startups a rocket boost in the development of their product or service. Where better to site an accelerator for social enterprises than in a struggling city? The perfect place to try out social business concepts locally.

Photo of Ciara Byrne

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[Evolver 2.0: A update based on all the great comments and links below.] 

Social enterprises are commercial business which also try to solve a social or environmental problem. I write about technology, and high-tech startups in particular, and accelerator programs are a popular way for new startups to get seed funding, mentoring and access to investors. The only accelerator program (not incubator) I could find that does something similar for social enterprises is run by The Unreasonable Institute ( http://unreasonableinstitute.org/). 

An influx of young entrepreneurial talent, at least a subset of which should be able to apply their social enterprise concepts in the local city, would surely be beneficial.

In most high tech startup accelerators, the founders come to live in the city which is the base of the accelerator for 3 months and work intensively on their product or service. Some accelerators have follow-on programs which encourage founders to stay for longer. Most accelerator programs are privately funded, for-profit businesses which supply the following to the participating startups:

- A cash investment of up to 15,000 EUR (5,000 per founder), i.e. enough to get the founders through the 3 month program, in exchange for equity - typically around 8% of the company. 
- Shared office space for all the startups in the current batch. 
- A structured program for accelerating the development of each business. This is usually based around mentors in the form of entrepreneurs, investors, PR firms, legal advisors, sales experts, etc. 
- Sometimes free access to services like software, legal advice, HR advice, etc. 

What this accelerator adds to the formula is the following:

1) Focuses on for-profit, social enterprises. 
2) Uses the city itself as a testing ground for the social enterprise concepts.The city could share its top 5 challenges with the accelerator as well as (ideally) access to relevant data, people and infrastructure relevant to those challenges. 

I don't think this concept will work for every city. It will take something more than investment and cheap real estate to attract and retain young entrepreneurs in the city - a fantastic music or art scene as in Berlin, great people as in Ireland, etc. 

What resources (money, time, people, technology, etc) will your concept need to be successful?

1) Leadership: The people leading the accelerator should preferably have a personal connection to and love for the relevant city as well as relevant skills. Former entrepreneurs, investors or executives with a big network would be suitable.

2) Seed funding: Funding for the accelerator's investments in the startups. Mostly this is raised privately, i.e. not government money, since the accelerator itself is a for-profit business.

3) Access to cheap or free real estate: The 10-15 companies participating need office space. Support from the city government or enterprises would be handy here. Nokia, which is in the process of closing down their development centre in Copenhagen, gave Startup Bootcamp some of that space for free.

4) Founders: A sufficient number of high-quality social entrepreneurs whose businesses are relevant to the city's problems and who are willing to participate in the accelerator.

5) City resources: Access to people running city government employees, programs, city data, etc. relevant to the challenges the startups will help tackle.

6) Corporations: Participation from relevant local businesses and corporations could help, e.g. give free services or access to their sales channels. In Dublin, for example, you have IBM's smarter cities research centre. Corporations are also possible future investors or acquirers of the participating social enterprises.

What steps could you take to implement this idea today?

Get feedback from social entrepreneurs and city governments to see if this idea is actually viable and what they would change in the concept.

How can your idea be scaled so that it's implemented in cities around the world?

Accelerator programs like Techstars, IBM smartcamp and StartupBootcamp are already in multiple cities. The latter went from 1 to 5 cities in less than 2 years.

However, as I mentioned above I don't think this idea works for every city. There needs to be something unique in the character of the city itself, Berlin is an example, which draws in founders.
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Photo of Stefanie

Ciara, I think the keys to running an accelerator like this in Detroit or a similar setting as opposed to in an already vibrant city (as exists in some of the links provided) are 1) immediate need in the surrounding environment, and thus easily-reachable test sites, and 2) simplification of the logistical/administrative issues mentioned by Ayoub below. I imagine finding cheap, abandoned office space to share, for example, would be fairly easy, and the surplus of labor in Detroit (both unskilled to, say, work as clerks in a service business, and skilled, say, to provide legal advice) also makes it an attractive venue.

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