A Waterloo, Ont.-based technology firm networking hub is launching a $30 million program to help early-stage startups commercialize their technology, the organization announced today.
Communitech is calling its new capital-supplying program Hyperdrive. It’s backed by private investment firms, angel investors, service providers, and business mentors. The program will provide up to $700,000 per firm and will operate out of The Communitech Hub building located in Kitchener. That 44,000 square-foot facility already provides services to 50 tech startup firms.
Communitech CEO Iain Klugman says the program is designed to address an “innovation gap” in Canada. Too often, early-stage firms fail to take a great idea through to a product on commercial markets.
“We need to get our companies funded earlier and more substantially,” Klugman says at Communitech’s Tech Leadership Conference in Kitchener, Ont. The program is designed to both provide funding for early-stage tech firms, and lower the risk of investment for venture capitalists.
Member firms will receive $50,000 in funding upon entering a three-month sprint period at the Hub. If they successfully complete the program, another $150,000 is awarded. Then an 18-month period begins with support from the program, and funding awards if certain milestones are met.
“It’s consistent with the way YCombinator and Tech Stars runs,” Klugman says. “The difference is we’ve lined up funding that will follow up with companies as they progress through the lifecycle. We understand it takes longer than three months to start a tech company.”
The program will also assist Canadian firms in expanding to key U.S. markets New York City and Silicon Valley. Members will also receive one-on-one coaching, workshops, events, investor introductions and demo days for the hosted firms.
Klugman wants the Waterloo region to be the second-best place in North America to start a tech firm, next to Silicon Valley, he says.
Cohorts of 10 startups will be accepted to Hyperdrive three times annually. More details on Hyperdrive will go online April 17 at www.communitech.ca/hyperdrive , and Hyperdrive will start accepting its first applications.