Entrepreneur says UK needs to follow Colombia's example
Start-up growth accelerator Moonshot Academy is applying lessons co-founder Al Walker learned while working in Colombia to the UK ecosystem.
The academy, which Walker describes as a “mission-control for start-ups” launched in July and is the brainchild of CEO Al Walker and Entrepreneurial Spark founder Jim Duffy. Registered in Glasgow it currently mostly focusses on Scotland and London.
It wants to change the fact that two-thirds of seed-funded start-ups fail to secure second-round investment.
Dundee-born Walker got the idea for Moonshot when running his own co-working space and accelerator in Medellin, Colombia – a place once more famous for its murder rates than its co-working spaces.
“When I went to Colombia there were three co-working spaces in Medellin and when I left there were 23 – not only did I see the growth but I was also seeing the pain point more and more,” he told BusinessCloud.
“I was seeing it there and Jim was seeing it here.
“The logic was that if I can come back and drive change in UK will be easier to expand globally from here than would be if we started the academy in Columbia. Plus it turns out a Scotsman cannot tan.”
The pair identified the fact that once businesses had seed funding they were falling into a support gap, and decided to tackle it.
“eSpark was doing a fantastic job for early stage businesses and we wanted to do something for the ones that had outgrown that,” said Walker.
“Businesses say they’ve secured seed funding and it’s almost seen as the pinnacle.
“The start-up landscape is awash with support for pre-seed businesses so if you have an idea and want to go for seed funding there are lots of accelerators and incubators that all focus at that point.
“But if you close seed funding over 75 per cent of start-ups with seed investment fail to get series A funding.
“Founders are left to fend for themselves and are crashing and burning.
“That’s the real pain because founders are struggling with marketing, supply chain, hiring, HR and their own development. Sometimes their own worst enemy is themselves.”
Since setting up the academy the team have spoken to over 100 founders and investors.
The academy, which agrees a fee upfront but doesn’t charge anything until the end, is getting set to take on another cohort and recently announced the appointment of two new directors.
Moonshot takes on maximum 15 businesses at a time – although out of the 73 they’ve seen so far they’ve only taken on three – helping them to drive toward Series A funding and ultimately an exit.
Part of this is going to businesses and to understand their culture and their teams work together in their own environment rather than getting businesses to come to them for a one-size-fits-all approach.
Another part of their work is ensuring businesses are accessing feedback from customers and checking product fit says Walker.
“We identified that 45 per cent of businesses have lack of product market fit,” he said.
“If we can turn into a mechanism where businesses can get live feedback on a regular basis it will increase their chance of success.
“Working with investors can actually side-track businesses. They spend a lot of time focussing too much on the product.
“It’s easy to focus and develop that, iterate and drive it forward then realise they’ve gone so far from what the customer wants they have no use for it.
“You need to check product market fit every week.”