July 28, 2023
One of the most successful accelerator and founder facilitation programs in Chicago is Techstars, an annual mentorship course that allows entrepreneurs, start-ups and companies to participate in a 13-week forum that teaches them how to improve and execute their business ideas. The program culminates on Demo Day – where the Techstars participants will pitch their concepts and businesses to the investor community. The participant Class of 2023 begins their journey on September 11th, culminating in Demo Day on December 7th, 2023.
Techstars is based in Boulder, Colorado, and has a global footprint. The Chicago branch began locally as Excelerate Labs – which was the brainchild of Sandbox Industries, the I2A Fund, Sam Yagan (OK Cupid, Sparknotes) and Troy Henikoff – before it merged with Techstars in 2013. Troy Henikoff was the primary Managing Director until Logan LaHive took the reins in 2017.
Neal Sáles-Griffin, an associate in Venture Capital and a Chicago founder, was named Managing Director of Techstars Chicago in July of 2019. Sáles-Griffin also ran for Mayor of Chicago in 2018. In an interview, Neal Sáles-Griffin spoke to the IVCA about his expectations as for the upcoming Techstars Chicago program and their participant Class of 2023.
IVCA: To bring us up to date for 2023, you’ve just finished Techstars Chicago ‘Powered by J.P. Morgan.’ What is the background of that element of Techstars, and what came out of the last session that is of note?
Neal Sáles-Griffin: I’m excited to share that we have four Techstars programs running in Chicago. Two are sponsored by J.P Morgan and the others are the city program accelerators. The just-concluded J.P. Morgan program was the last one that I’ll lead, and we now have Managing Director Tricia Martinez, who will take over the J.P Morgan side. My focus will be on generalist businesses, and Tricia will focus with J.P Morgan on Artificial Intelligence.
IVCA: As you mentioned, your focus now is on the generalist session for Techstars Chicago, which will start in the Fall and have its Demo Day in December. What was behind the scheduling?
Sáles-Griffin: We’ve been working on a consistent cadence with the Fall and Spring programs … we want to start them in either March or September. This way Founders know what to expect, orient their timelines around those dates and then everyone is on the same page in Chicago on when programs begin.
IVCA: One of the aims of TechStars is the highlighting of younger people, women and persons of color in your entrepreneur class mix. How does that fit into our point of view, within the evolution of the accelerator and subsequent investment as other generations participate in this risk and reward pursuit?
Sáles-Griffin: I’m very proud of our application process. At Techstars Chicago we’ve pioneered a new approach for taking in applicants for our program. So we don’t the traditional route … usually a set of interviews and then figuring out who we liked. Instead, I took the first two weeks of our accelerator curriculum and evaluated the educational content. I realized this was information that not just for the 12 companies who we invest in deserved to know, but all Founders deserve to have access to it. So I gave this information to the many hundreds of diverse applicants for Techstars Chicago.
This way, we can evaluate who comprehends the material very well, outperforms, and takes it seriously enough so that I can take it one step further with them. The Founders have really taken to and benefit from this application process … because even though there is a large percentage of companies that won’t be picked, they still feel their businesses got better just in the education we had them do.
IVCA: In your observation, what kind of energy do new entrepreneurs bring to the table that investors have been surprised about, and how does that excitement lead to funding?
Sáles-Griffin: There is a lot more accessibility for rapidly prototyping ideas with technology. These tech systems have become more accessible, for example it’s easier to both write code plus gain access ‘no code’ solutions. The democratization of utilizing technology for web, mobile and beyond is something I’ve seen a renaissance in during the past decade … investors in these early stages are reaping the benefits of the validations that come about sooner.
IVCA: What do potential investors need to consider about Techstars Chicago, that you think is unique to the accelerator industry?
Sáles-Griffin: Well, there is what is unique to the accelerator industry and there is what is unique to Techstars Chicago. The accelerator industry itself has evolved to the point where they are giving early stage founders a level of sophistication, structure and seriousness that is very necessary in an age in which many people are trying to become entrepreneurs. What the industry does is wade through the thousands of aspiring businesses and put them through more of the education and wraparound formalities that are important for an early stage investment process.
What is unique about Techstars Chicago is there is something different about the folks here on who we’re choosing and who we are. The energy and the focus on early-stage profitability is different, and our community network is a bit more low key. We’re not as showy, but we’re producing real revenue numbers.
IVCA: You’ve been in the Managing Director position for nearly four years. What are you looking forward to for Techstars in 2024 and beyond?
Sáles-Griffin: I’m a self taught software engineer, so I learned some important things about putting systems in place that are repeatable and more efficient. In doing so I’ve automated the application process and have put more consistency in running the Techstars program itself.
Even on the portfolio support side, once the companies have graduated, I have to take a lot of late night calls from CEOs … so I have to put more mechanisms in place to support them more robustly than just time. So that is what I’m looking forward to, and I’m really excited about it.
IVCA: We’ve just had a mayoral election. As a former candidate yourself, what are you observing about the Johnson administration that is investor friendly, and will you be advising him as someone who has experienced politics and commerce?
Sáles-Griffin: I love to have a conversation with the administration and be a contributor at some point. Personally I’m playing a long game with the City of Chicago so I’m less concerned about four year cycles and who is in the office. I’m focused on long-term change at the systemic level, which I campaigned on when I ran. I’ve been quietly doing that work, and I’m excited to keep that going. My only advice now is to have curiosity before judgement when it comes to every person, system or solution.
IVCA: Finally, how can the members of the IVCA contribute to Techstars Chicago beyond investing, including the support industries that make up a good portion of the membership?
Sáles-Griffin: We’ve love to have you get more involved in Techstars Chicago, from the ground up. So get to know our companies, get involved as a mentor, help us do a workshop and connect our companies to an opportunity. We are an open door, so if anybody wants to talk to us or be a part of it, including understanding the processes on why we chose the companies we chose, please contact me at neal@TechStars.com.
The Techstars Chicago accelerator begins on September 11th, 2023. Demo Day that culminates the program will be on December 7th, 2023, time and place TBD. For more information about TechStars Chicago, click here.