City Invests $1.9 Million in ABQid

The city of Albuquerque is poised to give $1.9 million to the new ABQid business accelerator program, Mayor Richard Berry said during a keynote speech at a NAIOP luncheon Monday.
The money will come from the city’s Economic Development Action Account, which is the fund the city set up with money from clawbacks from Schott Solar’s shutdown. It will help the new accelerator, which is based on the Techstars model, with programmatic needs.
“Now we’re taking what was a bet on one company, and we’ll turn it into a bet on 30 to 40 companies,” said Bill Bice in response to the announcement. Bice is a Verge Fund partner who is on the board of directors of ABQid.
ABQid is a new venture designed to help entrepreneurs in Albuquerque cope with the initial needs of a startup.
Entrepreneurs receive a $20,000 stipend, for example, so they can quit their day jobs and focus on their companies. They attend an intensive 90-day training that focuses on developing and testing their products. In exchange for the stipend and the training, companies give ABQid a six percent equity position.
“Take an idea, and run it through the business model canvas. What it’s really about is the assumptions you’re making about your business,” Bice said.
Bice said that entrepreneurs often find their assumptions are wrong in the process.
The program intends to enroll 10 companies in its first class, which is scheduled to begin in August. ABQid is hoping to recruit area high-growth startups that need a push — likely high-tech, software or hardware firms. “It can be any kind of company. It could be micro, it could be Main Street, whatever. But the focus is not on sector, it’s high-growth, and that has nothing to do with the type of company,” Bice said. “In no way is it exclusive to high-tech.”
The model has been proven in most major cities. The largest Techstars-type accelerator is Y Combinator, which is responsible for dozens of company launches every year.
The entire effort launched four years ago by Paul Short, who is the CEO of Pajarito Powder, and Bill Hartman, who is the CEO of Ion Linac Systems. At the time, though, Bice said the city was deep in the throes of the recession when the two started exploring the idea. They put it on hold.
But at a lunch one day with Gary Oppedahl, who is the director of the city’s Economic Development department, the two started talking about the idea and Oppedahl took it to the Economic Development Action Account council, Bice said.
The committee was set up in 2013 after the city received $5 million in clawbacks from Schott Solar, which closed its plant at Mesa de Sol.
“We’re creating startups that feed the larger ecosystem,” Bice said.
By: Dan Mayfield and Damon Scott (Albuquerque Business First)
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