Startup incubator DreamIt Ventures Austin is kicking off a new microfund this week that will benefit the companies involved with its second accelerator program.
The microfund, which will run through a partnership with AngelList, allows accredited investors to crowdfund money for startups. Everyone who participates in DreamIt Austin’s microfund will need to make a $2,500 minimum investment that will fund all nine companies within DreamIt’s Austin program — that means you can’t just pick and chose to fund only the companies you like.
Companies involved in the Austin program — Cheggin, CollaborateCloud, eyeQ, LiveWire, Notorious, Octane Lending, SecondMic, Swan, and UserApp — each needed to consent to the AngelList microfund ahead of time, which DreamIt addressed when going through the application process. The microfund should provide anywhere from $25,000 to $100,000 in additional investment to each of the nine startups.
“This just gives companies in the Austin program some extra runway to get off the ground,” said DreamIt Ventures managing partner Kerry Rupp in an interview with VentureBeat. “Founders will hopefully be able to spend more time applying [what they’ve learned from DreamIt] before having to raise more funding, too.”
Rupp explained that startups admitted to the program already benefit from a variety of perks, including access to an office space, mentoring, and up to $25,000 in seed funding that’s separate from the new microfund.
“We’re looking at this as a test case in Austin, but if it works well it may carry over to programs in other cities,” Rupp said. DreamIt also operates incubator programs in Philadelphia, Baltimore, New York, and Tel Aviv and has helped launch 127 startups since 2008.
The microfund is expected to close in early April, followed by a demo day event featuring the DreamIt Austin startups.