The Long Beach Accelerator, a public-private partnership between the city of Long Beach, Cal State Long Beach’s (CSULB) Institute for Innovation & Entrepreneurship and investment company Sunstone Management, took an important step forward with the recent launch of two investment funds aimed at generating capital to empower incoming startups. At an investor reception Aug. 27, project officials introduced founding board members for the nonprofit accelerator, one of two boards with oversight. And in a news release Aug. 15, Sunstone of Long Beach announced the launch of the LBA Sunstone Fund I, to connect vendors and early stage companies; and its partnership with Seraph Group on an additional seed fund. Among the takeaways:
• Both funds are poised for investment: Sunstone confirmed it has dedicated $1.4 million for the accelerator in its first year, via its fund. Seraph, Sunstone also said, will earmark $5 million to $10 million for its fund. Significantly, however, the funding from the Seraph Long Beach I L.P. Fund is bifurcated. Up to one-third is aimed at Accelerator entrepreneurs upon completion of the program, with the other roughly two-thirds available to fund “other seed round” startups, according to a Sunstone news release.
“This is an early stage fund to cover all the promising startups in the city of Long Beach. That’s really good for the city, for the local ecosystem,” Sunstone founding partner John Shen told Techwire.
Long Beach Economic Development Director John Keisler described investors’ expertise as “an extremely good marketing and promotion tool for local entrepreneurs.
“And if you look at it as an opportunity to spread the good word about the creative, innovative and dynamic companies that are forming in Long Beach, what better way to advertise that story than through the investor framework that Seraph has created globally?” he said.
• Long Beach Accelerator board officials are: Laserfiche CIO Thomas Phelps, as chair; Fulwider Patton LLP Partner Michael Moffatt as vice chair; Ragan Robertson, business development and information systems officer, UCLA Technology Development Group, as secretary; and city economic development commissioner Walter Larkins as treasurer. Board members are Blake Christian, partner, Holthouse Carlin Van Trigt LLP; Ganesh Raman, CSULB assistant vice chancellor, research; Keisler; Shen; Pat Nye, regional director, Small Business Development Center; Wade Martin, institute director; and Robert Stemler, shareholder, Keesal, Young & Logan.
A second board, to overlook the accelerator’s investment fund, has not yet been seated.
• Initial feedback from investors has been “tremendous,” Shen said, but startup recruitment hasn’t yet formally begun. He estimated the first startup cohort could arrive sometime between October and year’s end.
• Accelerator startups will “live” in about 2,500 square feet at first, at Sunstone’s Long Beach World Trade Center offices downtown, space that’s capable of being expanded as needed. That area, Shen said, is “80 to 90 percent ready,” dependent on the number of startups in the first cohort.
“But I think the current build-out pretty much fits what we (are shooting) for, which is, I believe six to eight startups and maybe one or two or three people per startup for the first year,” he said.
