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XMeet the 10 Startups in Techstars' 2021 Space Accelerator Class
Samson Amore
Samson Amore is a reporter for dot.LA. He holds a degree in journalism from Emerson College. Send tips or pitches to samsonamore@dot.la and find him on Twitter @Samsonamore.
Techstars' Space Accelerator took off this week with its third class of space-related companies that make everything from AI-powered smart cameras to technology that can anticipate celestial collisions.
The 10 startups selected for the competitive four-month program are based across the U.S. and Australia and will work with Techstars on a mostly remote basis.
All are developing technology with multiple uses in space and will receive a $120,000 investment in addition to access to Techstars' expanding network of mentors.
That network includes aerospace experts at the Pasadena-based NASA Jet Propulsion Laboratory. Participating companies include Lockheed Martin, Arrow Electronics, SAIC and Israel Aerospace Industries.
"Alumni from our previous cohorts are launching space systems and infrastructure, raising tens of millions of dollars in venture capital as well as receiving lucrative contracts from both government and commercial customers," said Jonathan Fentzke, the program's managing director.
The program will culminate in a demo day on Sept. 2 where the startups will show off their work in hopes of winning potential investors or clients.
Fentzke noted that while no companies in this year's cohort are based in LA, Techstars still has partners mentors and investors based here.
"As it turns out the four companies in California out of 10 are not based in L.A. today, but will likely have a presence over time," Fentzke told dot.LA.
Here's a look at the 10 companies selected for this year's Techstars Space Accelerator.
Hyperkelp
LOCATION: San Clemente, Ca.
CEO: Graeme Rae
Founded by maritime engineer Dr. Graeme Rae, Hyperkelp is building buoys that aren't your average fishing bobber. Its tech can collect and transmit data about the surrounding ocean and incoming payloads from space. The company says its goal is to create a network of the buoys around the ocean to help aerospace launch companies stream data from anywhere around the world.
Hyperspec.ai
LOCATION: San Francisco, CA. and Tel Aviv, Israel
CEO: Ohad Levi
Hyperspec.ai makes smart cameras that run on artificial intelligence. The company's CEO Sravan Puttagunta previously worked in HP's engineering department. In a nutshell, Hyperspec's cameras are made to create accurate mapping and object tracking in real time, with the goal of being used on self-driving cars and other autonomous vehicles.
Nicslab
LOCATION: Sydney, Australia
CEO: Dr. Andri Mahendra
Nicslab develops technology called the "source measurement system" that uses quantum computing to help organizations optimize their internet speeds and make them faster. Its current clients include the University of Oxford, HP Labs and Mitsubishi Electric.
Pierce Aerospace
LOCATION: Indianapolis, In.
CEO: Aaron Pierce
Pierce Aerospace makes software that helps autonomous drones identify objects and payloads. It argues that this software is critical to the development of the drone industry -- after all, it can be pretty scary if a drone goes rogue because it can't see where it's going. In 2019 the company received a roughly $50,000 grant from the U.S. Department of Defense to continue work on its flagship product, the Flight Portal ID system, which the DoD wants to use on its Unmanned Aircraft Systems.
Pixspan
LOCATION: Rockville, MD.
CEO: Michael Rowny
Pixspan develops a system that lets large files be transferred from different storage locations (like hardware or the cloud) at rapid speeds -- sometimes up to 5 times faster than average, it reports. It's compatible with several app programming interfaces, the main one being Amazon Web Services.
QuSecure
LOCATION: San Mateo, Ca.
CEO: Dave Krauthamer
QuSecure is a security company that focuses on protecting government and corporate systems from hacks. Specifically, its software works to keep encrypted data from being stolen and decrypted by quantum computers, which can steal and read valuable information at rapid speed. Its customers include Google and Amazon.
SCOUT
LOCATION: Alexandria, Va.
CEO: Eric Ingram
Scout -- also known as Scout Space -- develops software that helps spacefaring companies visualize what's going on in the great beyond and avoid casualties, like crashes with other spacecraft, satellites or debris. The company was founded in 2019 and says its name is an acronym for helping Spacecraft Observe and Understand Things around them.
SeaSatellites
LOCATION: San Diego, CA.
CEO: Mike Flanigan
As the name suggests, SeaSatellites is building unmanned vessels that work as satellites for the ocean and have a wide array of potential uses, from environmental data collection to communications. Similar to their skyward counterparts, SeaSatellites' tech can be controlled from anywhere and are designed to carry payloads on long missions.
Xairos
LOCATION: Denver, CO.
CEO: David Mitlyng
This company's name is Greek to us -- literally. A nod to the Greek god of opportune time, Kairos, is an appropriate name for this startup using quantum mechanics to bring GPS-type technology to areas of the globe without internet access.
Thermexit
LOCATION: Boston, MA.
CEO: Katie Willgoos
Thermexit is the only company in this year's Space Accelerator cohort that's led by a woman. CEO Katie Willgoos joined the company in March and helps the company create and sell its main product, Theremexit Pads, which are tiny thermal sensing sticky pads that can be placed on circuit boards and inside computers.
Correction: An earlier version of this post stated this is Techstars' second space accelerator cohort. It's the accelerator's third such class. It also, misnamed the CEO of Hyperspec.ai.
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Samson Amore
Samson Amore is a reporter for dot.LA. He holds a degree in journalism from Emerson College. Send tips or pitches to samsonamore@dot.la and find him on Twitter @Samsonamore.
https://twitter.com/samsonamore
samsonamore@dot.la
You've been eyeing a new startup for a while now. It seems like they're doing well一they just received a new funding round and are growing like crazy. So you take a chance and apply to one of their positions. Before you know it, you're in the final round of the application process.
Now comes the inevitable discussion about compensation. The hiring manager explains that you can choose between more cash and less equity, or vice versa. What do you do?
If you've worked at a startup before, you are familiar with this tricky situation.
If the startup keeps knocking it out of the park, you're bound to feel some of that upside in your wallet at some point. That said, the fact that only 10% of startups become successful makes the odds seem pretty grim. Can your team make it to an exit point?
With the startup market in Los Angeles booming, we decided to delve into the topic of startup equity. Read on to understand what startup equity is, how to think about the tradeoff between cash and equity, and why startups give their equity away (or not).
What Does Startup Equity Actually Mean?
Having equity means you have a financial stake in a startup. Typically, equity is used to incentivize employees to work towards a common goal, whether that be becoming the next unicorn or being acquired by a major enterprise. CEOs have good reason to offer equity. Hourful CEO and founder Walter Aguilera puts it this way:
"It's important to approach the process of building a company with a team mindset. Knowing there's equity involved helps everyone push through practically working for free at the early stage of a business."
That sounds all well and good, but it means you're putting a good deal of faith in your company's leadership team and coworkers to make the business successful. It's important to remember that equity gets diluted based on the company's performance and valuations that might not have anything to do with how well you, as an individual, perform.
Plus, you don't exactly have that hypothetical money at your fingertips. There are stipulations tied to how much stock you get, how long you have to stick around to realize your full equity package, and how you can exercise your options in the future.
What Should You Consider Before Accepting?
If you're considering roles at startups, expect to get varying levels of equity as part of your offer. Think hard about your level of risk tolerance as you prepare to negotiate 一 and maybe accept 一 the offer,.
L.A.-based NextStep Careers founder and CEO Emily Taylor suggests that job seekers ask one simple question when considering equity:
"Would you invest your own money in this company? Because that is essentially what you are doing," she says.
To answer that question, you may want to step back and do an objective assessment of the company. Here are a few questions to get you started:
- Is the startup bootstrapped, or have they successfully raised funding? If the startup received funding, who backed them, and how reputable are they?
- What stage is the startup at? What is their plan to make it to the next stage?
- What is the size of the market this startup operates in?
- Who are the startup's biggest customers?
- Who are the startup's biggest competitors and do you think the company can build and maintain a moat?
- What's the startup's estimated cash flow?
- How much do I resonate with the founder's vision and mission?
You may not be able to find all this information, but you can get scrappy about it. Find and reach out to people who currently work there or worked there in the past to validate what you've found and get more insight. Look up the company on AngelList, Crunchbase, and review sites like Glassdoor. Read the startup's most recent press releases and announcements to find out what product features are coming down the pike and any notable new hires they've made. These could be fantastic clues as to how profitable the company might become over time.
How Much Equity Should You Expect?
Equity packages come in all shapes and sizes, but how much you get depends heavily on what stage your startup is at. Usually, 10% - 20% of total shares go towards the employee equity pool. This means that at very small startups (pre-seed to seed), you may be compensated only in equity. While that's not nice for your wallet now, it can be a fantastic time to get in, since shares will only continue to get diluted with more and more fundraising rounds.
"We gave equity to our first employees because, in my view, early-stage employees are critical to what you're building," says Val Young, former co-founder and co-CEO of apparel company RecRoom. "They ought to have both skin in the game and the opportunity to reap the rewards if things go well."
If you're joining a later-stage startup, on the other hand, you will probably be offered a mixture of equity and cash. Initial shares will have already been absorbed by current employees and investors.
"Many companies will be open to trading off between salary and equity and this can be an excellent negotiation tactic," Nextstep's Taylor writes. "That said, doing so depends on their cash flow - they might be flush after a venture round or are pinching pennies until the next fundraise. So if you are leaving a role with greater cash compensation, it's a good idea to set a total amount of salary + bonus + equity to keep you whole."
Another thing to keep in mind is that the amount of equity you get can hinge on your role. Many companies tend to give employees focused on technology more equity than those with business-oriented roles. According to TechCrunch, a senior engineer might be granted 1% of the company, whereas an experienced business development employee is given a .35% share.
As you might expect, job title plays a role as well. VPs and above are likely to get a much larger stake in the company than more junior employees. Browse AngelList's salary and equity data to see what might be reasonable in your startup's category and your career level.
Understanding Your Equity Offer
Not all equity packages are created equal, so it's important to educate yourself on the ways equity can differ from company to company.
One thing to bear in mind is that startups often denote equity in terms of shares in an offer letter. 50,000 shares can sound like an awful lot, but that may only be 0.05% of the total company shares. A quick way to level-set on how much you're really getting is to ask how many shares are outstanding. The number of shares you're offered, divided by the total number of shares will give you the percent of the company you own.
Another thing to examine in your offer letter is your vesting schedule. It's fairly common to have a 4-year vesting schedule at startups, meaning you gain 25% of the total shares you're given with each year you stay on with the company.
Of course, you won't actually receive your equity in dollars until an exit event. If your startup exits with a huge valuation, your equity could be worth a lot. But, if your startup never goes public and never sells, you may only get paid out what's left of the company's revenue according to your contract.
Finally, pay attention to what happens to your equity when you leave. Sometimes employers have a clause stripping away your equity, even if you've put in a full year. This practice, called a "one-year cliff," acts as a form of insurance so the startup doesn't relinquish precious equity to people who aren't fully dedicated for the long haul.
Should You Take It?
Working at startups isn't a walk in the park. Oftentimes you're doing multiple jobs at once for lower pay. Equity offers can be overwhelming, but all of your sleuthing and pre-research should bolster your confidence in the company's potential—what really matters most.
VoyageLA Founder and CEO, Mayank Bhandari, advises that the decision on whether to accept equity should be part and parcel of your decision to work at a startup.
"You should only work for a startup if you really believe in the mission and team. But if you do, then taking equity is a no-brainer," he says.
Are you in the midst of making a final decision? Let us know how it went!
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Elizabeth Melton
Liz is a problem solver who takes great pleasure in finding new ways to drive business value. Her background in consulting, product management and strategy has helped her cultivate relationships with partners including Target, Madison Reed, Nestle, Experian and Databricks.
https://www.linkedin.com/in/elizabethmelton1/
Image Source: Joby Aviation
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Joby Aviation, a pioneering electric air taxi company, has achieved a significant milestone by successfully flying a hydrogen-electric aircraft demonstrator for 523 miles with only water as a byproduct. This groundbreaking flight showcases the potential for emissions-free regional travel using vertical take-off and landing (eVTOL) aircraft, eliminating the need for traditional runways. The company's innovative approach combines its existing battery-electric air taxi technology with hydrogen fuel cells, paving the way for longer-range, environmentally friendly air travel.
For LA residents, this development holds exciting implications for future transportation options. Joby's technology could potentially enable direct flights from LA to destinations like San Francisco or San Diego without the need to visit conventional airports, offering a cleaner and more convenient alternative to current travel methods. The company's progress in both battery-electric and hydrogen-electric aircraft positions it at the forefront of next-generation aviation, promising to revolutionize urban and regional mobility.
Notably, Joby Aviation has already made strides in Southern California by securing an agreement with John Wayne Airport earlier this year to install the region's first electric air taxi charger. This strategic move sets the stage for LA to be among the initial markets where Joby will launch its electric air taxi service. With plans to commence commercial operations as early as 2025 using its battery-electric air taxi, LA residents may soon have access to a fast, quiet, and environmentally friendly mode of transportation that could significantly reduce travel times and traffic congestion in the region. In the not too distant future, LA might find itself in an identity crisis without traffic and excess smog 🤞🤞.
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