TinySeed, a new accelerator program designed for self-funded software startups, has raised around $3.4 million from 49 backers, according to an SEC filing.
Like other accelerators, TinySeed takes a small amount of equity in a company in exchange for mentorship and funding. In this case, participating companies will receive between $120,000 to $160,000 depending on the size of their team.
TinySeed is shaking up the standard accelerator format in several ways. Most notably, it will go for one year (rather than the typical three months), and the 10 participating companies aren’t required to relocate for the duration of the accelerator. TinySeed just asks that they are located somewhere in the Western Hemisphere.
TinySeed will also forgo another accelerator tradition: demo day. At the end of a lot of programs, the companies pitch their progress in an attempt to raise a seed or Series A round. Because TinySeed is designed for bootstrappers, this is not the end goal for its startups. Which gets to the heart of TinySeed’s unique model: focusing on growth through revenue rather than raising venture capital.
Minnesota startups are bringing in more and more venture capital every year, with local companies raising over $700 million in VC in 2018, according to PwC’s MoneyTree report.
At the same time, there’s a small but growing contingent of entrepreneurs choosing to bootstrap their companies through revenue from the business, personal savings, salary earned from a day job, traditional debt or other forms of income.
“When it comes to venture capital, you need to know what you’re getting into,” TinySeed Founder Rob Walling previously told Minne Inno. “The media glorifies raising funding so much that it seems like the end goal to some people. But it’s not. It’s the start of the journey. And it only gets more difficult from there.”
