Accelerating an Accelerator
UVM alum puts pedal to metal at MassChallenge
- By Jeffrey R. Wakefield
If ever there was cause for optimism about the future of the American economy, it’s in the thrum of energy emanating from the wide-open co-working space at Boston-based business accelerator MassChallenge, where the founding members of 128 elite start-up companies are mashed together at rows of long tables, each fledgling firm marked with a small branded sign.
The electricity in the air is no surprise to UVM alum Scott Bailey (finance/entrepreneuship, 2009), managing director of the accelerator at the tender age of 29.
“These are the top people in their industries,” he says. “They decided to leave their jobs and start (their own companies) because they're not only passionate, they believe there's a huge opportunity.”
In MassChallenge – a supernova in the world of business accelerators, with locations in five countries and on a rapid growth curve – they’ve found the perfect environment in which to make that opportunity real.
Since its founding in 2009, the wealth of resources the accelerator has made available to its 835 alumni start-ups have helped them raise $1.4 billion in funding, generate $575 million in sales and create more than 50,000 direct and indirect jobs.
Sizzle, no stake
MassChallenge occupies a full floor in an immense renovated manufacturing building in the city’s Innovation District on the South Boston waterfront.
What accounts for its success?
Most accelerators are run by venture capitalists with a financial stake in the companies they’re grooming, explains Bailey, who joined the company as an intern and rose rapidly through the ranks.
“MassChallenge puts the entrepreneur first,” operating as a nonprofit that takes no equity in its member start-ups, Bailey says. Its independent status “makes it much easier for us to attract resources,” like angel investors, universities, government, corporations, and venture capitalists and match the right support to each entrepreneur.
MassChallenge is also the ultimate meritocracy, unlike its peers, drawing its tenants from a mammoth, multi-phase business pitch competition that winnows 2,000 initial applicants to 350, then to 128, then to a fortunate 26, who have the opportunity to win portions of more than $1 million in grant prizes.
The cash is nice, Bailey says, but it might be the 128 semifinalists who are the real winners. Their reward? A four-month residency at MassChallenge, where they take advantage of all those resources -- at no cost -- to develop their businesses and hone their final pitch.
Two crazy guys
While the entrepreneurs’ path to MassChallenge couldn’t be more intentional, Bailey’s was anything but.
Bailey caught the entrepreneurial bug at UVM, working with a start-up that made a bus tracking app and almost singlehandedly creating the Entrepreneurship Club.
Rocki-Lee Dewitt, a professor at the Grossman School of Business who was then dean of the school, remembers him as one of the most talented students she encountered in a 30-year career. “He is the guy you want on your team,” she says.
He also began interning at the Vermont Center for Emerging Technologies, a UVM-affiliated tech incubator with an on-campus location, where he aced project after project. VCET director David Bradbury says he had no choice but to hire him.
Toward the end of his first year at the incubator, a VCET client named Ty Danco, a mentor to Bailey, told him about an intriguing -- but sketchy sounding -- opportunity in Boston.
“He said, ‘You should talk with these two guys, these two crazy guys from Bain Consulting,’” Bailey recalls, referring to MassChallenge’s founders John Harthorne and Akhil Nigam. “’They announced a million-dollar competition but with no funding, so I don’t know if it’s going to work.’”
That was all Bailey needed to hear.
“I basically packed up all my stuff one weekend, and my mom drove me down to Boston,” he says, where he stayed with college friends and soon landed an internship at the new accelerator.
He threw himself into the new enterprise, working from 6 in the morning to 9 at night. In a replay of his VCET experience, the two founders, whom he now counts among his best friends, offered him a job.
Bailey eventually found a home in fundraising and partnership-building and rose to associate, then director of partnerships, then senior director, and finally managing director.
Back to undergrad
Camped out at one of the long tables in MassChallenge’s co-working space are Patrick Boyaggi and MikeTassone, founders of the barely hatched start-up RateGravity.
“You can think of it like a TurboTax,” Boyaggi says, test marketing the requisite pitch all start-ups hone to impress investors. The computer program takes consumers step-by-step through the loan approval process, then pairs them with a local lender who’s agreed to return the labor savings in the form of a lower interest rate.
Boyaggi and Tassoni, who left high-paying jobs managing residential lending at Arlington, Massachusetts-based Leader Bank, reach deep into their past to describe the energy and excitement they feel at MassChallenge.
“The best analogy we can make is that it’s kind of like going to undergrad or when Mike and I went to business school,” Boyaggi says. “They talk about being the friendliest accelerator that exists on the planet. They've lived up to that expectation in every way.”
It’s hard to exaggerate how much Bailey has accomplished in his brief career. Not only is he the human face of the Boston accelerator, providing mentoring and encouragement to the entrepreneurs as he walks the floor by day and building relationships in the community by night, he was recently put in charge of exploring MassChallenge’s U.S. expansion and overseeing hiring in the new locations.
Isn’t it gratifying to be a founding member of such a highly successful enterprise, one that’s making such a contribution to the social good?
It might be, but victory laps aren’t Bailey’s style.
“We’re just getting started,” he says with a smile.