Hometown Pride

“The inhabitants of Cincinnati are proud of their city as one of the most interesting in America: and with good reason.” – Charles Dickens

Is your hometown the place you were born?  Where you grew up? Or where you live?  For me, I always talk about being an “adopted son” in Cincinnati.  Its my hometown and where I’ve now spent nearly half of my life.

I bring this up because the last few weeks have been one of hometown pride.  On a small scale, our new class started at The Brandery, which means 20+ entrepreneurs that are moving to town and becoming part of #StartupCincy.  They are moving into our new Branderyhaus apartments and becoming part of the community in Over-The-Rhine.  And if we do our job right, they will want to make Cincinnati their home well past Demo Day in October.

But the hometown pride I talk about took part on a much larger national scale this past week as the Major League Baseball All-Star Game came to town for the first time since 1988.  To say the city has changed dramatically since the MidSummer Classic last came through the Queen City would be an understatement.  A good reminder of that change came on Tuesday morning when the team from REDI Cincinnati invited me to do a short talk.  REDI is our regional economic development initiative and they were hosting a group of Site Selectors in town for the All Star Game (ie the consultants that help companies decide where to relocate / open new offices).  We spent the morning at the 3CDC offices talking about the Public-Private Partnerships that have led to not only the revitalization of our OTR neighborhood but has also served as a catalyst for #StartupCincy.  During one presentation, the team from 3CDC showed the before and after photos of their work in Over The Rhine.  You could literally hear gasps from some of the audience when they saw the change.

I spend most of my time across the Midwest in cities like Cincinnati, Detroit, Indianapolis and others.  The common thing about all of them is that they are filled with entrepreneurs who spend each day fighting the good fight to help their community reach it’s potential.  The past week was one of those where we got to see the hard work pay off and others saw first hand why we have the hometown pride that we do here in Cincinnati.

How To Stand Out When Applying To The Brandery

Did you know that getting into a top tier startup accelerator is actually statistically more difficult than getting into Harvard? For its Class of 2018, Harvard accepted around 5.9% of their 34,000 applicants. In 2014, The Brandery accepted half that percentage with <2.5% of applicants being offered a spot in the program (a number we consistently see with other top-ranked peer programs).

So what should a founder do in order to get their application to stick out? After reviewing thousands of applications over our five previous classes, here are a few best practices I have seen work to help your startup stand out from the crowd. None of these are hard and fast rules, but more what I personally look at when I am reviewing our applications.

1. Become a known entity

If there were only thing that a startup could do when applying to The Brandery, this would be it. It amazes me how many startups apply for The Brandery but do not do any personal outreach. It is pretty easy to find out the decision makers behind our program. All of the founders and staff are listed on the website. All of us are very open about our contact info with emails and Twitter. And we hold a ton of events during application season where you can meet Brandery staff, alumni, and mentors in person. Yet despite this, an amazingly low number of applicants take any steps to reach out beyond their written applications. One of the keys to standing out is to have champions that believe in your team and your company. You can increase your odds of finding those champions by putting in the extra effort to meet the people behind the selection process.

2. Get a personal introduction / endorsement

Speaking of finding champions, one of the best ways to stand out from the crowd is with a warm introduction from someone in the Brandery network. We have an amazing group of mentors, investors, and alumni that are part of The Brandery family. If I get an email introduction from any of them telling me that “so and so startup is applying for The Brandery and they are awesome”, then I put that application on the top of my list. For instance, we had one application a few years ago that had a so-so initial product. But right before they applied, I received an email from an investor I trusted who said the startup had “one of the best mobile product teams” they had ever seen. Needless to say, that type of endorsement changed how I viewed the application right off the bat.

3. Do not be a “Me Too” Startup

Every year, The Brandery receives around two dozen applications that are best classified as “Me Too” Startups. The common theme of these companies is that they are a small twist on whatever the hot startup happened to be that year. When Groupon was gearing up for an IPO in 2011, we had an influx of companies with takes on the Daily Deal space. When Instagram was bought in 2012, our application inbox was flooded with photo startups. The shame with these applications is that I often don’t spend the time digging into the team because I’ve already dismissed the potential of the idea right off the bat.

4. Prove your hustle instead of telling us about it

Every startup talks about having the perfect “Hacker, Hustler, and Designer”. But it is interesting how often The Hustler actually doesn’t show their hustle. If you want to see hustle, talk to Michael Wohlschlaeger, CEO & Co-Founder of Ahalogy. When Michael applied to The Brandery, he and his wife were living in China. That year, The Brandery was having a “get to know us” happy hour during applications at a local bar in Cincinnati. Michael showed up at the event, where we learned that he flew from China to St. Louis (where his family was from) and then drove six hours from St. Louis to Cincinnati— just for the happy hour. That is the definition of hustle. I knew at that moment I would place a bet on Michael as an entrepreneur no matter what. Since Ahalogy has been ranked the fastest growing startup in Ohio the past two years, I think Michael has lived up to that reputation for hustle.

5. Apply early

Do not wait to the last minute to apply. Yes, the final deadline to apply is April 16th, but don’t make the mistake of waiting that long. All of us are reading applications as they come in, and I personally have a ranking of my top 10 applicants that is evolving in real-time. If your company has applied early, that has given me a longer time to learn about you, the company, and your team. I have been able to research the space you are playing in and talked with other investors about the opportunity. If you apply at the last minute, you are “forcing” me to make a quick decision about whether you should be a company we interview and accept.

All that being said, applications to the Class of 2015 are open now. The deadline is April 16.

Never Stop Fighting ‘Til The Fight Is Done

Hanging on my office wall is one of my favorite prints that I bought a few years ago in Chicago.  It is a quote from the movie The Untouchables that reads:

“Never Stop Fighting ‘Til The Fight Is Done”

That quote has come up in at least three conversations this past week as I talked with people about what makes an entrepreneur succeed.  Through five classes at The Brandery, we have seen nearly 50 startups come through our doors with our fair share of successes and failures.   And while it is tough to point out one thing that separates the companies that make it from the ones that don’t, there is a common thread.  The ones who make it are the ones who “never stop fighting”.

The life of a startup is one hell of a roller coaster.  Even the companies that ultimately succeed go through their fair share of moments where their backs are against the wall and the future looks bleak.  It is in those those moments that it is easy to quit.  To take the fall back option that they all have.  After all, the entrepreneurs that walk through our door at The Brandery come from remarkable backgrounds.  We have folks that were in Med School, were working as a Product Manager at Google, or were running very successful digital agencies.  It would be really easy for any of them to throw in the towel and go back to that world they came from.

But the best entrepreneurs are not wired that way.  Once they have gone down the path of starting a company, they do not want to go back to the world they came from.  For them, failure is not an option.  Or said differently, failure would be going back to what they were doing before.

I was reminded of this when I recently sat down with one of our Brandery alumni.  This was a company that had moved here from the East Coast and stayed in Cincinnati when they raised their seed funding.  Over the last two years, they have been cranking on their MVP but it never really got to product/market fit.  Fast forward to today and some folks would have hung up the towel.  But not these guys.   For them, the fight isn’t done.  Instead, they bootstrapped a little more capital and are using it on a new concept.  And this new concept might actually be bigger than their original idea.  They could have given up many times along the way but quitting just isn’t in their DNA.  Sure they still might fail…but they won’t be a failure.  These folks gave it their all and I know they put everything into it.  They did not just quit because things were tough.

Even after 5 years working with startups at the Accelerator stage, I am still trying to figure out how you determine if someone is wired this way.  It is a trait that is rarely going to show up in the “resume” of a first-time founder.  But it just might be the single most valuable trait an entrepreneur can have in succeeding in their early days.

Don’t Bet Against The Midwest

If I was to share the following facts with you, what part of the US would you think I’m talking about:

  • Represents over 20% of the US GDP
  • Nearly 25% of all research in the US is done here and 25% of all patents in the US are granted here
  • In the last 5 years, 52 companies that are based here have either gone public or been acquired for over $1 Billion.  In total, these 52 companies represent over $140 Billion of aggregate shareholder value
  • 1 day car drive to 60% of the US population

While the headline of this post obviously gives it away, most people would see these figures and think of Silicon Valley or possibly the Northeast.  But instead, these facts are about the Midwest and its why I decided to plant my own entrepreneurial flag here with Rockfish and The Brandery.  And thankfully I’m not alone in that sentiment with stories like:

Since the downturn of 2008 – 2009, a pretty amazing entrepreneurial renaissance has started across the Midwest.  The stats above prove it and it’s something I’ve watched first-hand since leaving P&G in 2010.  When we opened the Rockfish office in Cincinnati, the company had ~70 people total and our office was just three of us.  Fast forward to today and Rockfish is nearly 4x that size and the Cincinnati office is now nearly 80 people.  And at The Brandery, we are graduating our 5th class of companies next year and nearly 60% of those Startups have stayed in Cincinnati after graduation.

Yet the interesting thing is that despite this existing foundation of success, there is untapped potential for the Startup investment community.  Case in point is that only 7% of the venture capital in the US is invested in the Midwest.  And that is despite that 25% of research here.  And despite the $140 billion in aggregate shareholder value created here.  Warren Buffett famously said to “Be Fearful When Others Are Greedy and Greedy When Others Are Fearful.”  While I don’t believe it is fear in this case, the essence of Buffett’s wisdom holds true when it comes to the potential in the Midwest.

This same untapped potential exists for Brand Marketers as well.  The reason 25% of patents are issued in the Midwest are because of our concentration of Fortune 500 (P&G, Ford, etc), research universities (University of Michigan, Northwestern, Ohio State University), and startups.  And that means we don’t need to travel across the country to find startups that are driving the next wave of innovation.  We can find it in our own backyards by visiting and partnering with Startup Accelerators like The Brandery in Cincinnati, Tech Incubators like 1871 in Chicago, or Venture Capitalists like Drive Capital in Columbus.  We just have to raise our hands and get involved as marketers.

Finally, part of the inspiration in writing this post was the announcement today that my friend and mentor Wendy Lea is going to be moving to the Midwest (Cincinnati in particular) to take the role of CEO for Cintrifuse.  Wendy is one of the most respected leaders in the Startup community and her belief in the potential of our region is further proof of the Entrepreneurial Renaissance that is underway.

Looking Back: The Birth of The Brandery

This year The Brandery will welcome our 5th class of companies, a milestone that we could only dream of just a few years ago.   We didn’t expect to be looking back on our 5th Anniversary with 36 alumni startups.  And we for sure didn’t imagine that those companies would have raised over $45 million in venture capital.  Or that Over the Rhine would have been reborn on the back of these entrepreneurs.

So as this year’s applications start to roll in on AngelList and F6s, I find myself being a bit nostalgic in wanting to answer the question that I’m often asked:

“How did The Brandery get its start?”

To find the earliest seed of The Brandery, you have to go back to November 2009.  I was working at P&G in Corporate Marketing in a role where I was spending quite a bit of time in the world of digital marketing, venture capital, and startups.  It was in that role where I got to know JB Kropp, who as a serial entrepreneur was one of the Cincinnati-based employees for ShareThis.  JB and I often found ourselves talking about the Cincinnati startup community and what was holding us back.  One frequent topic was JB’s experience of folks wanting to grab coffee/lunch to pick his brain in relation to his SF experience in the dot com world.  It was in that experience that JB really thought we needed something like TechStars to support the ecosystem.  Supporting that point, two themes resonated in the conversation:  mentorship and focus.  We knew that Cincinnati had the people talent, but we lacked a place for entrepreneurs to turn for guidance and coaching.  Additionally, we were a startup community without an identity or really a focus.  With those themes in mind, our conversation eventually landed us on the idea of a startup incubator that would be focused on applying the concepts of brand marketing to startups.   The incubator model would address the mentorship theme, while the focus on brand marketing would leverage the unique talent of our region.

The first person we ever shared this idea with was Pete Blackshaw, a nationally recognized digital expert who had launched a startup called Planet Feedback back in the Dot Com days (Pete is now the Global Head of Digital at Nestle).   Out of that meeting, Pete signed up as our first official mentor, well before we even knew what we were getting ourselves into.  The second person was Bryan Radtke, a close friend and P&G colleague who over a meeting at a high top table at Zip’s came up with the name The Brandery, inspired by Cincinnati’s rich history in beer brewing (ie make beer in a brewery / make brands in the Brandery).

As we rolled into 2010, things were starting to fall into place now that we had positive validation for the idea and a name to actually call the thing.  In January, we met with George Molinsky from Taft Law, who was one of the original co-founders of Main St Ventures.  MSV was in many ways the precursor to The Brandery, just a decade before.  We also locked on our own brand identity during that month thanks to a campaign on CrowdSpring where we eventually selected a logo designed by the Cincinnati-based digital agency, Ample.

In the spring of 2010, we added to our scrappy group as Eric Avner from the Haile Foundation pledged the initial financial operating support to launch the program and LPK signed on as our first agency partner.  A few days into April, George Molinsky introduced us to one of his Associates at Taft, Rob McDonald.  Amongst many things, Rob would be instrumental in finalizing our decision to launch The Brandery as a non-profit,   structuring the warrants / equity with each company, and in general shoring up the foundation of the program for years to come.

As we entered the summer, one pretty major barrier still existed.  We had decided to follow the Startup Accelerator model pioneered by TechStars.  As such, a key component of our business model was a $20K investment into each company, which in turn would give us a 6% equity stake in that startup.  The goal was that those equity stakes would eventually result in liquidity events that would give us a sustainable endowment for the program.  But we needed to have dollars to invest to make that dream a reality.  It was at that time that a VC colleague, Dov Rosenberg, introduced The Brandery team to Mike Venerable of CincyTech.  In late June 2010, we had our first meeting with Mike and he pledged to help us launch The Brandery using the CincyTech Imagining Grants.  So with just over $30K in operating capital and 5 grants worth $100K, we announced The Brandery to the world on July 19, 2010 with a short 4-week application window.

We received just north of 80 applications that first year, ultimately selecting 6 companies.   Three of those companies were from Cincinnati and one each from Dayton OH, Chicago, and Houston.  The number of companies from out of state was surprising, but foreshadowed the years to come.  For instance, the company from Houston was called Giftiki, founded by Justin Stanislaw and Bryan Jowers.  They were recommended to us by Blair Garrou, a VC from the Mercury Fund in Houston who we had met earlier that summer because of his investment in ShareThis.   Giftiki would go on to be one of our success stories that year, raising a $1 million seed round from Draper Associates and other Silicon Valley VC’s.

The inaugural program started on August 31st at Longworth Hall, in a small ~2,000 square foot space that we had leased.  Ironically it was that same week that Bryan and I announced that we’d be leaving P&G to open the Cincinnati office of Rockfish.  The Brandery office would double as the Rockfish office throughout the rest of 2010.

Year 1 of The Brandery concluded on November 19, 2010 as we hosted our first Demo Day at the LPK Innovation Center.  Ben Lerer from Thrillist / Lerer Ventures was our keynote that year, flying in earlier that morning after a late night in NYC celebrating Thrillist’s 5 year anniversary.  The crowd that day only numbered 150 people but at the time was one of the largest gatherings our town had seen of investors from outside the region.  In the months that followed, The Brandery was honored to be named one of the Top 10 Accelerators in the country by Tech Cocktail and was asked to be a Founding Member of the TechStars Network (now called the Global Accelerator Network).

It has been remarkable to watch the evolution of The Brandery from that first bootstrapped year.  Now every year comes with a new nervous tension as we wait for applications, hoping that this year’s class can live up to the previous year.  But time and time again, the companies end up setting the bar higher for us and exceed expectations all over again.  I’m looking forward to seeing what this  fifth class has in store for us.