Google has dropped a $50 000 grant for each startup selected for its fifth Launchpad Accelerator, which starts next month, the programme’s manager Josh Yellin revealed yesterday.
The programme targets growth stage tech startups and 24 startups will embark on a bootcamp on 29 January 2018 (see the names here).
Talking to Ventureburn in Warsaw, Poland during a graduation ceremony for the programme’s four cohort (see the list of participants from the fourth cohort here), Yellen said the tech giant aims to reinvest the $50 000 per selected startup (totaling $1.2-million for the fifth cohort) back into the programme to cover the costs of startups attending conferences and foreign business trips.
The decision was taken after consulting with programme participants, he said.
“As the companies are getting more mature, they have closed rounds of $5-million and maybe some of them have recurring revenue of six figures or something. Anyway the 50k becomes a drop in the bucket. But becomes a limiting factor for us on how we can help them,” he said.
Google will reinvest the $50 000 back into Launchpad Accelerator to cover the costs of startups attending conferences and foreign business trips
Yellin said since it kicked off two years ago the Google Launchpad Accelerator has expanded from three to 40 countries, while the average amount of revenue and funding raised per startup has grown every cohort, while the selected companies are becoming “more mature”.
Google runs two cohorts a year. From recruiting from just three countries for the first cohort (India, Indonesia and Brazil) in 2015, the programme grew to four countries in the second cohort, then eight in the third and 17 in the fourth cohort.
The fifth cohort targeted 40 countries. The 24 companies selected for the fifth cohort, which begins in January, are from 15 countries.
“We knew we wanted to be focused in emerging startup ecosystems — this was our goal from the beginning. Not only did we think it was something that the world needed, but we thought Google was well positioned as a global company to support it in this way,” said Yellin.
He said Indonesia, India and Brazil were chosen as the first three countries the programme would recruit from, as Google had a particular focus in these countries and had teams on the ground in those countries.
For Google the programme is an opportunity to get feedback on its products — as Google representatives are involved in engaging with the startups on the programme.
“By bringing this programme into the company you sort of allow every product team to go on a round-the-world emerging market business trip in their backyard and learn,” said Yellen.
He pointed out that in the two years of the programme Google has been able to improve its products such as Google Adwords and its developer products such as Firebase by engaging with the startups.
‘Improved our confidence’
Commenting on the programme, Delivery Science co-founder Toyin Oshinowo said the initiative helped the three-year old startup — which provides mobile forms to help large organisations in Nigeria get field data — to increase the startup’s number of prospective clients.
Delivery Science was one of five African startups that graduated last night from the programme. The other companies were: Twiga (Kenya), JUMO (South Africa) and Flutterwave and Paystack (both from Nigeria).
The startup has six fulltime staff and five contract employees. Google, Oshinowo said, has also helped them to begin sourcing finance, as up to now the business has only been able to raise small amounts of funding from a few angel investors.
“I think one of the things that Launchpad did is make us realise we have a strong product. It gave us the confidence to say ‘okay we have this product and we know what it’s worth’ so in negotiations we’re (at) a better standpoint and it also gave us the confidence to go out and look for new clients,” said Oshinowo, who founded the startup in 2014 with Chuka Ofili and Lanre Oyedotun.
As the programme grows, more Africans startups will be hoping to use the initiative as a launchpad into the wider continent and other regions. If by investing the grant money back into the programme Google is able to cover more business trips — more tech entrepreneurs like Oshinowo will be scrambling to apply.