Princeton’s Innovation Garden Nurtures Its First Startup
NJTechWeekly.com recently had the opportunity to visit Innovation Garden, the workspace and business development incubator located in Forrestal Village (Princeton). Innovation Garden is already home to one startup, Wasabi 3D, a unique company that extends the reach of 3-D live art events through social media.
“We are not an accelerator in the sense of a 12-week program,” managing director Tom Sullivan explained. “We are bringing capital, resources and ideas to a 10,000-square-foot facility. We are looking at investments in the $250,000 range. In fact, we are more of a business development laboratory, working the business model.”
Innovation Garden offers a workspace and mentoring to entrepreneurs who have highly scalable companies with low cash burn, to help them cross the desert between bootstrapping and a Series A funding round, Glenn Fratangelo, chief operating officer, said. The companies are expected to exit Innovation Garden in two or three years.
Fratangelo told us Innovation Garden is presenting a term sheet to its possible second investment, a digital e-commerce company, shortly.
The focus here is on the entrepreneur, Sullivan said. “We want to know if the entrepreneur is passionate about change and willing to fight the battle for success.” Added Fratangelo, “We are looking for great entrepreneurs who are able to pivot their business plans to make them scalable.”
To that end, Innovation Garden facilitates deal flow by inviting entrepreneurs to stop by the company’s “Open Innovation” hours, facilitated through a group on Meetup.com. The company is looking for digital, e-commerce, software and services startups suitable for its space that use technology to disrupt an existing business or create an entirely new one.
The organization operates two separate but interrelated components: the Innovation Garden Accelerator Fund, managed by Sullivan and VC Scott Sipprelle, makes the actual investments in the companies. The Innovation Garden accelerator program, colocated within Princeton Partners, offers startups space and services ranging from legal and human resources to operations and tax reporting, a “way to take away the operational headaches,” Tom Sullivan said.
Fratangelo is the startups’ acting CFO and CEO, not officially on their payroll but working for Innovation Garden. He takes on the HR duties, bookkeeping, financial modeling, capital acquisitions analysis and pricing analysis duties. Other companies, such as Wiss & Company (Livingston), SorinRand (East Brunswick) and Borden Perlman (Lawrenceville), provide accounting, legal and risk management services for member companies.
NJTechWeekly.com spoke to Chris Sullivan — Tom Sullivan’s son, formerly of Princeton Partners and now Wasabi 3D’s CEO — about his startup and how it came to be Innovation Garden’s first investment.
Fratangelo said even though there is a family relationship, VC Scott Sipprelle had the final say in who was selected for this first investment. The company met with about 100 startups prior to making the investment.
Chris Sullivan told us that in 2009 he asked an intern to find him the world’s best 3-D artists for a project he was running. He found two in London and formed an arrangement with them. Through Princeton Partners, they sold a combined live event and social media outreach for the project, combining the event with Facebook and Twitter in a way that hadn’t been done before.
That success led Sullivan to sell the concept to Coke Zero, Adidas Golf, Johnson & Johnson and the Philadelphia Phillies. “We found there was really a very viable market for this and a way to scale this that people weren’t exploiting. We think we have a unique opportunity with our business approach.”
A social media analytics piece is being explored, Sullivan added. Once the fans are engaged, “the social media analytics become more valuable.” When Wasabi 3D worked on an event for Coke Zero, it did so in New Orleans, in a confined area with nine other vendors. For those nine, the experience people had stayed there and went no further.
“With our experience, not only were participants able to take away a keepsake photography element, but because we drove them online to Facebook, we were able to track how far our message had spread, not only through New Orleans and Louisiana and the U.S. but how many countries throughout the world. We tracked languages, gender and age. In total, the message had spread to 20 countries, in more than 10 languages. An event for 1,000 people reached more than 44,000.”
After that success, “we decided to roll out a separate company backed by Innovation Garden.” Wasabi 3D is a standalone U.S. operation providing engagement media services for clients at product launches and marketing events that extends those events’ reach through social media. Innovation Garden has made a $120,000 initial investment in the company and expects it may need to invest another $125,000 as a follow-up round, Fratangelo said.
“What I like about Innovation Garden is they do the grunt work for you. They do all the legal work that needs to be taken care of, the banking, the back-end office support. These are things a small company would struggle with. I know I would struggle with it. I don’t have that kind of expertise. I want to focus on the creative and business aspects, which are my strengths.”
From Fratangelo’s perspective, providing these services frees the entrepreneur to “sell, sell, sell,” he said.