Photo by Sean Pavone/ Shutterstock
Meet the Startups Joining the Long Beach Accelerator's New Cohort
Long Beach has a long history of innovation. It’s one of the densest aerospace hubs on the West Coast. There’s a vital port there, and the city is home to several tech industries—including health care, space tech and cybersecurity. That, along with its colleges and universities, have made Long Beach an enticing destination for entrepreneurs.
It’s within this environment that the Long Beach Accelerator sprouted in 2019 and has grown since. To date, the accelerator has cycled 20 companies through its four-month program, helping them raise a total of over $12 million.
On July 5, the program will welcome its fourth cohort of startups from around the world, participating in a hybrid combo of virtual and in-person sessions. Each cohort includes between five to 10 companies.
Long Beach, along with Cal State University, Long Beach’s Institute for Innovation and Entrepreneurship and capital provider Sunstone Management, are all partners in this public-private model of startup investment. The accelerator itself operates as a nonprofit.
Long Beach Accelerator Managing Director Andrea White-Kjoss
The city provides help with some funding, covering the costs for some low- to moderate income Long Beach-based founders whose companies are accepted into the accelerator.
The organization's partnership with CSULB enables it to help founders move from idea stage to execution at the institute, and then advance to business growth via the accelerator.
Sunstone Management, a private capital management and investment firm, provides funding for the incoming cohorts. The firm's venture capital fund typically invests $100,000 in the startups as soon as they join the accelerator and takes a 6% equity stake in return.
Sunstone had also been providing some follow-on funding on a case-by-case basis. It upped the ante earlier this year by promising an additional $500,000 to current cohort and alumni.
“It's a model that brings enormous resources to the table for our portfolio companies, as well as for economic development, acting as a growth engine for the region,” managing director Andrea White-Kjoss told dot.LA.
A serial entrepreneur who has served as CFO at several companies, White-Kjoss came aboard as the founding managing director in July 2020. Before that, she co-founded seed-stage funding platform ExtraVallis, based in Rancho Santa Fe, and founded Mobis Transportation, which was the product of a public-private partnership with the city of Long Beach.
She also happens to be a 17-year resident of the city.
“So I know intimately how attractive this city is to tech entrepreneurs, from the high-tech industries, to the culture and lifestyle, to the world-class workforce and institutions,” she said. “When you bring all of that together...the opportunity to build a tech accelerator, and more than that really, a tech ecosystem here in Long Beach, was natural and irresistible.”
The accelerator was originally intended to be in-person, but quickly had to pivot to remote sessions during the pandemic. It remains virtual, for the most part, “which has turned out to be a huge source of strength,” White-Kjoss said.
That’s because the founders come from all over the world. There’s no geographic restrictions on who’s accepted and no need to burden founders with moving to Long Beach to participate.
White-Kjoss said the move has fostered diversity, and enabled the accelerator to draw on an international network of mentors, instructors, advisors and investors.
They—along with the accelerator’s staff of three facilitators — get to know the companies and their founders “deeply” and provide individualized assistance, including building strategic partnerships with potential customers and/or marketing partners.
There is still an in-person aspect to the accelerator. All cohort founders fly into Long Beach for about two weeks during the program. While there, they attend in-person workshops and networking events. They also participate in a Demo Day, with investors present. This helps the companies get additional seed funding for continued growth once they graduate.
So far, five graduating startups have received acquisition offers—but none have taken them.
White-Kjoss said that’s because those founders “felt they had much further to take their companies, at least in some degree, due to the empowerment of the tools, resources and networks provided by the accelerator.”
Bump's Success
One success is Los Angeles-based Bump. Since graduating from the Long Beach Accelerator, Bump has raised more than $5 million, co-founder and CEO James Jones told dot.LA.
It’s currently participating in another accelerator, Snap’s in-house Yellow Accelerator, which is now a co-lead investor in Bump, along with Sunstone.
The company is working on an AI-fueled fintech platform for the creator economy, which hasn’t yet launched. It would help creators track revenue from multiple sources, monitor expenses, access credit and manage their crypto and non-fungible tokens (NFTs).
The company has started a waitlist, for access to its credit and financial management tools. Once the services are available users would pay about $400 per year.
The company also plans to integrate micro-advances into its platform, designed to enable creators to stay in full control of their finances and keep 100% of the rights to their work.
Jones said that participating in the Long Beach Accelerator’s very first cohort was a “great springboard” for the company.
Specifically, sessions on customer personas and discovering addressable markets, as well as mentor meetings were “invaluable,” he added.
Meet the Startups In the Long Beach Accelerator's Latest Cohort:
Apsy: Creating the first true fully AI platform to build affordable elegant custom apps.
Crumbraise, Inc.: Fundraising made easy for creators, clubs & causes.
Educational Vision Technologies, Inc.: Automated video editing and content curation using A.I. to make online learning accessible, efficient and engaging.
Gift Pass App Inc.: Streamlining experiences around digital gifting & payments.
The Girls Co LLC: We are a women's health company that is currently focused on a solution to alleviate period cramp pain.
Intellitech Spa Inc.: Intellitech is a realtime telematics, predictive maintenance and driver behavior monitoring platform.
Kwema: Kwema provides an easy to scale Smart Badge Reel Duress Service that reduces incident response time without escalating the situation.
Pathloom, Inc.: Outdoor trip planning made easy!
Rotender: The world's fastest and most reliable bar.
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Kiwibot has quietly been testing its robots – specially designed to look cute and non-threatening – for the past few weeks in the Valley, as well as more recently at a major university campus the company won't yet name. If all goes well, Kiwibot will begin offering delivery to students through as early as next month before expanding to Santa Monica and other parts of the city after that.
"L.A. is going to be our most important city this year," Chavez said. "In the first five months of the year we plan to employ 100 robots here in the city, and we expect that by the end of the year we're going to have around 400 robots deployed."
Postmates, which is now owned by Uber, has been testing a handful of delivery robots in West Hollywood since April. While those are accompanied by a human chaperone, the Kiwibot robots set out on their own, though operators take over remotely for more complex tasks like crossing the street.
Kiwibot has already made over 120,000 deliveries since 2017 during rollouts at University of California, Berkeley, University of Denver, and San Jose, where it partnered with Shopify and Ordermark. But L.A., with its vast geographic footprint, is a whole new degree of difficulty.
"It's a great challenge for us," said Chavez.
Kiwibot chose L.A. because the city already has a high adoption of food delivery, it is home to potential partners like ChowNow and Ordermark, and the city has been a willing collaborator through its Urban Movement Labs (UML), mostly by sharing data on city streets and sidewalks.
"We trust L.A. to be the best new market for us because the food delivery habit is already there, and we feel backed to scale in an organized and socially responsible and sustainable manner," said David Rodriguez, Kiwibot's head of business.
After a confrontational approach between cities and ridesharing and e-scooter companies, Lilly Shoup, UML's interim executive director, says L.A. is trying to be more collaborative with delivery robots.
"I think we've learned that it's important for city transportation agencies to get ahead of new technology before they appear on city streets," Shoup said. "It's important to understand their business models and proactively develop policies."
UML is also working on a pilot to deliver goods via drone by 2022 and in both instances Shoup says the technology can help reduce pollution and congestion since most deliveries now are made via cars.
"It's really exciting to think about new ways to reduce the environmental impact of delivery," Shoup said.
Robots substantially bring down the cost of delivery, which could help restaurants that operate on thin margins during even the best of times and have been devastated this year. But it will also mean fewer delivery jobs, most of which have been preserved as contract work in California with the recently passed Proposition 22.
Restaurants typically pay between 15% to 30% on orders placed with delivery services like Postmates or Grubhub and drivers are hardly getting rich. In fact, they often make less than minimum wage.
Kiwibot charges fees of a couple dollars on each order – which can be absorbed by the restaurant or passed onto customers. The company says its cost per delivery is now $2.98 but as it scales and the technology improves it can shave the cost down to $1.23 by the end of 2022.
Right now, Kiwibot robots – which cost between $2,500 and $4,000 each – can only operate in a 1.5 mile radius but the company's next generation can go eight miles and is large enough to fit a 12-inch pizza.
Photo by Ben Bergman
Will the Public Accept Robots?
Even when the technology is ready, Kiwibot has what may be a tougher obstacle to overcome – public acceptance. Public safety commissioners in West Hollywood raised concerns about Postmates' robots and even in tech-friendly San Francisco, a city lawmaker, worried they might run into pedestrians, tried to ban them.
Kiwibot warns potential investors on its crowdfunding page: "Delivery bots have proved controversial in some regulatory environments with some cities, like San Francisco, putting out laws that make it difficult for us to deploy. If this became widespread we would have trouble going to market."
Chavez says he spends a great deal of time thinking about how he can get the public to be comfortable with robots.
"There is a sector of people that are concerned about robots and I think that it is very important to listen to them and to get their feedback on everything. but robots are going to happen," Chavez said.
The robot also has a sign affixed to the back to clarify that it is not recording any video, something that was added after homeless people in San Jose feared they were being spied on.
There is a "black box," which records in case of an emergency, but none of the devices have been stolen — so far.
Even though local regulations can allow for robots to go as fast as 10 mph, Chavez has found a speed of 6 mph makes people feel safer.
There are also important visual considerations. Kiwibot's robots look nothing like the hulking devices conjured up in sci-fi movies like "Transformers" or "The Terminator." They are more like a plastic cooler on wheels with lights on the front that resemble a smiling face.
"The new version is even more cute," said Chavez. "It's like a squirrel on a rock."
Taking a page from nature, the design is deliberately playful and small.
"When you see an animal and it is bigger than the width of your shoulders you feel threatened," Chavez said. "So we have made sure that the robot is never going to be wider [than you] so that people don't feel threatened."
Coronavirus has also been helpful, helping accelerate the adoption not only of delivery but also of robots – who you don't have to worry about coughing on you.
Competition with Bigger Robot Deliveries
Kiwibot, which is based in San Jose, has raised more than half $1 million from more than 650 investors in its latest crowdfunding campaign, to bring its fundraising total to over $3 million.
That pales in comparison to not only Uber but also much larger rivals Starship, a robot food delivery service launched in 2014 by two Skype co-founders that plans to rollout deliver to 100 universities by next summer and Nuro – an autonomous vehicle startup founded by two ex-Google engineers valued at $4 billion. The company received regulatory approval last week to operate on city streets in the Bay Area.
But with global autonomous last-mile delivery projected to grow from $11.16 billion next year to $76 billion by 2030, Kiwibot sees room for multiple competitors.
"In L.A. right now we are talking with multiple partners, very big companies," said Chavez.
"Everything is moving very fast," he added, as his robot inched along the sidewalk, heading back to the lab to continue more testing.
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