When Sabastian Hunt left college nine weeks before the start of his senior year to live out of a van, splitting time sleeping in a tent and couch surfing for four months on a trip across the American south and east, neither he nor his concerned family knew he’d pick up skills out on the road that five years later would net his venture a $50,000 award in the SBA's Accelerator Growth Fund competition.
"I earned a lot about networking, how to live lean, how to figure out how to make things work, and how to live," Hunt said. "That has meant everything doing this."
"This" is his idea for a live-in business accelerator, Year of the Startup. Since late 2014, for the cost of monthly rent over the course of a year, entrepreneurs get a near-monastic experience in a room in a hundred-year-old Midtown Omaha “startup house” to work and sleep, and a chance to pick the brains of some of the city's most experienced and successful small business mentors.
Access to business mentors and startup 'ecosystem'
The startup fellowship, the only one in the city, is within walking distance of one of Omaha's most vibrant art and creative communities, a partner which gives them access to a shared working space and a creative gallery to host a constant rotation of guest speakers from the business community. And the location was no accident--they're close to Omaha's north neighborhoods, a chronically impoverished geographic area starving for small business revitalization.
In January 2015, Hunt hired Jason Feldman, who gave up a career in sales, logistics and product demonstration to serve as community manager for the city's only entrepreneurship residency fellowship.
"Something we realized was very important to entrepreneurs getting started is a micro-ecosystem,” Feldman said, “so we offer an environment to foster ideas, learn from each other, and at the same time reducing the financial pressure on them personally as they work."
Once finished with this fellowship and ready to launch, they get up to $10,000 of their rent back as seed money in exchange for a six percent stake in their company.
"As time goes on, they're more invested in their own projects the longer they stay and the more they put into that rent savings fund," Hunt said. The incubator also is assembling a roster of willing investors to help startups get access to capital.
Year of the Startup also finances its fellowship program by filling spare rooms in its startup houses through a popular website that allows people around the world to list and book a place to stay online. Drop by the place and you're just as likely to meet a couple of visitors from Australia recreating Jack Kerouac's famous trip across the country as you are to watch an up-and-coming entrepreneur in the fellowship program, marker in hand, using the white-board painted wall in the dining room to best figure how to scale his business to new markets. It makes for a heady mix of new experiences and new perspectives under one roof.
Already sparked a number of promising companies
Since its kickoff, Year of the Startup already helped germinate a handful of fast-growing local companies, including Nightlife Transit, a service shuttling bar-hoppers from one Omaha entertainment district to another.
"Our buses are airport shuttles converted to a party bus ‘feel,’" said owner Eric Burns, who also owns a bar and grill in suburban Plattsmouth. In getting those interested having in a good time to a place where they can have that--safely--and having a little fun on the way, Burns has taken his venture to "cash positive" in just a couple of months. Moreover, he's been approached by parties interested in franchising his venture, including a college town in Colorado and to the Jersey Shore. The nascent startup already made an appearance in a feature story on Inc. Magazine's web site.
Hunt first imagined the idea of an entrepreneurship fellowship during his senior year studying economics at nearby University of Nebraska at Omaha, as he shared a class with Year of the Startup’s original co-founder, Jon Ochsner.
During an internship at a non-profit as he studied African-American entrepreneurship, Hunt met with many other community-focused groups, including an artists' residency program lacking housing for their creative types, some coming halfway around the world to work here.
"So I naively said, that's what I'll do, buy a house and then they can stay there," Hunt said to the artists' group organizers. Learning of his plan, his own non-profit asked Hunt: "why don't you do that for us?"
By January 2014, Hunt was going through graduate school and had a day job as a claims auditor for an insurance company. While the work paid a steady, comfortable salary, "it was getting bad. I was dreading going to work every day."
One day, to fight the boredom, he was listening to an audiobook, and caught a phrase from the narrative: "Year of the ..."
"Startup," he finished.
"It just hit me. That's the name of what I want to do."
Hunt put in his two weeks' notice the next day, and set out to create Year of the Startup.
Soon enough, along with Ochsner, Hunt and the accelerator’s founding board were able to get a few promising early stage entrepreneurs to apply for the program, and the group rented its first “startup house.”
Applying for the Accelerator Growth Fund
Then came the Accelerator Growth Fund competition. Tipped off by a business reporter at the Omaha World-Herald who'd gotten the SBA's news release announcing the call for entries, Hunt and Feldman scrambled to put together their video package with the help of Black Shutter Visuals, a local media production startup, to meet the fast-approaching deadline.
They made that deadline, and the list of finalists.
Hunt was watching the coverage online of the first-ever White House Demo Day Aug. 4, hoping among the showcase of innovators across the country--and among those to receive a share of $4.4 million--would be the name of Year of the Startup.
And there it was.
"My reaction when we won? I kind of got a tear in my eye, I have to admit it," Hunt said. "We had done so much the past year with so little resources. There were many improvements we wanted to make to our program that would allow us to serve more startups, and do so more effectively, but we had such severe budget constraints.”
Just as important, the funds offer Year of the Startup a platform others can duplicate. They've visited a similar group for startups in Kansas City, and plan to donate part of the SBA award to their effort.
The balance will grow their startup residency program to a village of 10 or 11 homes, and accelerating 30 startups per year "with all the additional cross-collaboration, energy and networking of a great community," Hunt explained. They also plan to reduce the residency fellowship from a year to nine months, freeing up the summer months to host more travelers, taking in more revenue to support their entrepreneurship mission.
All to help the next generation of startups get off the ground, and to build a lasting, vibrant community in town.