Improving City Living, One Startup at a Time

DailyWorth

Photo Courtesy of SketchAway.

If you’re reading this, there’s a good chance you’re doing it in or near a big city. More than 80 percent of Americans now live in urban areas, according to the U.S. Census Bureau. If you’re among them, you’re probably well aware of the advantages to urban living: close proximity to an array of amenities; access to a wide range of cultural and culinary offerings; and transportation options that don’t need to include a car. But there are often downsides too -- crime, noise, congestion, and pollution to name a few. Enter Clara Brenner and Julie Lein, whose self-described “urban ventures accelerator” Tumml is meant to give a leg up to startups trying to improve high-density living areas.

We talked to them the day after applications closed for their first cohort. The five start-ups they choose will get $20,000 in seed funding; about $30,000 worth of in-kind services (such as legal help and work space in San Francisco’s The Hatchery, where Tumml is located); and a four-month learning curriculum with mentors such as Molly Turner of AirBnB, Tory Patterson of Catamount Ventures and John Tolva, Chief Technology Officer for the city of Chicago. At the end, of course, they’ll have a chance to pitch their ideas to potential funders. Tumml will take a five percent equity stake in each business.

DailyWorth: So, what is Tumml exactly?

Clara Brenner: We’re a non-profit with the mission of empowering entrepreneurs to solve urban problems. Think the next generation of Zipcar, or Revolution Foods—companies creating consumer-facing products and services that tackle city problems. We think there are real market opportunities there for entrepreneurs who are thinking creatively in this area.

Where did the idea come from?

Brenner: Julie and I met at MIT’s Sloan School of Management. We’d both had really good experiences working for what we call ‘urban impact companies’ — Julie worked at Revolution Foods and I worked for a company called Fundrise — we were just curious about why we weren’t seeing more companies like that naturally pop up.

What’s your theory?

Julie Lein: When we surveyed urban impact entrepreneurs, two findings stood out to us. The first was that there was a capital gap: Urban impact companies were less than half as likely as their traditional peers to receive seed-stage funding. This was partly because the capital requirement was more onerous than if you were just creating an app in your basement, for example. If you’re doing a bike share, you need a whole fleet of bikes.

The second thing was that these urban impact entrepreneurs really wanted a different kind of mentorship. They’re nearly twice as likely as their peers to want to connect with civic and government leaders, because they might need help with, say, securing permits for their bike share, or their food truck, or—like Uber—to change some regulation. So Tumml was really born out of the idea of trying to solve those two problems: One, providing some seed stage capital. And two, providing the right kinds of mentorship for these urban impact companies.

Keep reading to find out how Tumml was launched. 


 

How did you go about getting the idea off the ground?

Lein: It was tough. We started doing the research early on, and continued building blocks for our mentorship board throughout the summer when we were being incubated at MIT. Moving out to San Francisco in September 2012 accelerated the process for us. Getting our 501(c)3 non-profit status was not easy, and Nixon Peabody really helped us expedite that. We got our first grant, $65,000 from the Blackstone Charitable Foundation, in January of 2013 and we wouldn’t have been able to get it without non-profit status.

Applications for your first cohort just closed. How did you get the word out to entrepreneurs?

Lein: Entrepreneurs don’t necessarily self-identify as urban; they’ll identify in a particular sector, like waste and resource management or mobility. So reaching this group has been a challenge, and being able to reach out to them through social media — through things like Facebook and Twitter and blogs — has been incredibly important. It’s worked to our advantage in that people are starting to see us as a convener for all of these different folks who might not normally be in a room together. You know, government officials, startup entrepreneurs, people who fund the sharing economy, big companies like IBM.

I know it’s early on, but what kind of ideas are you seeing?

Brenner: There are some sectors that are pretty well represented, like transportation. It’s a lot easier for people to conceive of new business ideas when they’ve seen some early successes, and in San Francisco there are already [transportation-focused startups like] Getaround, Uber, Lyft, SideCar, and Zipcar. But we’ve been very excited to see a number of companies interested in dealing with issues like homelessness, or waste and resource management. Some we’ve been most surprised by have been in small business services: People looking to either support manufacturing and trade within urban areas or support small local businesses.

Companies that would serve other companies?

Brenner: An already-existing example might be a company like Smallknot, which helps small local businesses raise capital from the community. So, say you’re a local restaurant that’s been in the neighborhood for 30 years and your freezer breaks, and it’s like, `Either we can replace the freezer and fire a line cook, or we can have no freezer and keep our employee.’ With Smallknot, you can raise money from the community and buy a new freezer, and in exchange, donors get a free pizza or something.

Where would you like to be in a year or five?

Lein: We’d love to have this program be large enough that we can support two cohorts a year, and that in each of those two cohorts we can support ten companies each time.

Brenner: From a larger vision perspective, our real goal is to build a pipeline of these types of companies and be able to prove their worth to more institutional investors. I think right now, if you want to start the next Facebook, there’s a place for you to go to get resources and money. If you want to start the next social entrepreneurship product or service in rural Pakistan, there’s a place for you to go as well. We want to make it as attractive and seemingly as achievable to start a company that solves a problem in your own backyard. It’s getting people thinking differently, because everyone will be better if these issues get solved.

For more information on Tumml’s program, click here.

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