New B2B startups

There’s no shortage of incubators and accelerators sprouting up around the Seattle area, and yet the creators of 9Mile Labs feel as if there’s still plenty of room to operate.

Their hook?

The firm is focusing on enterprise software companies, rather than the sexier consumer mobile apps and Internet startups that emerge from other accelerators.

That may be a smart bet. After all, money continues to flow to B2B startups, currently the hot sector in venture capital circles (as we’ve seen with recent large deals for companies like Smartsheet.com and Qumulo).

9Mile is still finalizing its physical location, but the firm will officially open in April when it accepts its first cohort.

It plans to invest $20, 000 in the companies which are accepted into the three-month program, taking an eight percent equity stake. That’s similar to TechStars, which also operates in Seattle, though it takes six percent equity stakes for investments of $18, 000.

We chatted via email this morning with 9Mile principal Sanjay Puri — a former employee at Microsoft, Opsware, Edifecs and H-P — to find out more about the new accelerator. Here’s what he had to say:

Why does Seattle need another incubator/accelerator?

“According to the latest Startup Genome report, Seattle ranks as the No. 2 region for technology talent globally. Seattle is also the No. 4 startup ecosystem placing only behind Silicon Valley, Tel Aviv and Los Angeles. Even subjectively, if you look at the startup and tech events organized by GeekWire and others, the number of aspiring entrepreneurs and the level of energy is amazingly high and plain to see. However, we have a surprisingly deficient support ecosystem, with two premier VC firms and the rest that you can count on the fingers of one hand; and this number is only depleting with OVP, Frazier and others closing down. Techstars is doing a phenomenal job as an accelerator but their capacity is limited to 10 companies per cohort. So where are the other early stage entrepreneurs to go? We believe the timing is right for Seattle to break out and support its budding entrepreneurs. But it will take more than just 9Mile Labs. It requires VCs, government, higher ed institutions and angel investors to all come together with the entrepreneurs to help build this out. We’re trying to work with all of these critical stakeholders to energize and re-invigorate the ecosystem.”

—How many companies do you plan to invest in each year, and how much money will you invest? What percentage equity stake will you take?

“We will have two cohorts per year, one in Spring and another in Fall every year. Our first cohort begins April 8 (applications to the cohort will open on January 14, application deadline is February 15). We will invest $20, 000 in every company and will take an 8 percent equity stake.”

—What makes 9Mile unique from other accelerators?

1. We are focused exclusively on B2B startups

2. We are setting aside a pool of equity for our mentors as part of our program. This enables mentors to see the upside from the startups they are helping.