Dallas—A new accelerator for hardware innovation is being hatched in Texas.
MakerSeed, which will be based at the University of Texas at Dallas, will focus on student startups and entrepreneurs developing technologies in wearables, IoT, robotics, and other hardware specialties.
“I realized there’s kind of a grassroots maker community and a lot of talent in building hardware coming out of UTD, (the University of Texas at Arlington), and parts of Texas,” says Ethan Hall, chairman of the board and founder. “But there’s really not a program that focuses on this.”
Hall says makerSeed will host a “Shark Tank”-style contest for UTD student entrepreneurs in order to find four teams to participate in the four-month pilot program. After tweaking the program based on that experience, he says their plan is to host a “regular” class of four to six teams at the accelerator in the fall or next spring.
One it’s off the ground, makerSeed will join the ranks of similar programs that are currently based on the East and West coasts. Bolt, which started in Boston with a $4 million fund, added a second location in San Francisco in 2015 after it raised a $32 million second fund.
Other programs include the R/GA Connected Devices Accelerator in New York, which is run by Boulder, CO-based Techstars; and Highway 1 in San Francisco.
Hall says it’s time hardware entrepreneurs in the middle of the country—namely, Texas—had these sorts of resources, too. “A lot of people don’t realize that Texas has a very strong electronics market,” he says. For example, he points to statistics such as the $218 million spent on research and development at Texas universities, and the $42.4 billion of goods that Texas exports annually.
MakerSeed’s funding structure is also being tailored to the regional market, Hall says, so it will not be raising a traditional fund. “This was out of necessity because Dallas is not the kind of town where VCs are interested in funding a program like this, especially one for hardware,” Hall says.
Each startup will receive up to $25,000 from makerSeed, which will raise its funds through grants and sponsorships from corporations looking to get connected to specific innovations. In exchange, each startup gives the accelerator 5 percent of revenue, outside funding received, or an exit.
Key to makerSeed’s model is bringing in the businesses with interest in hardware innovations as sponsors. Sponsorship packages range from $5,000 to $100,000, with the highest levels essentially giving those companies first rights to technologies developed at the accelerator.
That close relationship will enable participating entrepreneurs to have a clear idea of what market demand is, Hall says. “Our aim is to try to do market validation very early and won’t develop products that won’t go anywhere in the marketplace,” he adds.
