Logistics Launchpads: Tech accelerators foster air cargo innovation

What’s an accelerator?

Unlike venture capital firms that often seek a controlling interest in the firms they assist, technology accelerators tend to be more hands-off, allowing the group of startups to grow organically in a highly collaborative setting. This allows them to make smaller, riskier investments.

At EPIcenter, several startups are chosen each year through a competitive application process, Smith said. Each finalist will also receive US$50,000 in initial seed capital, in return for a modest 7 percent equity stake. Half of this investment, from venture capital firm Innova, is earmarked toward the

developing the initial product and a business model. The remaining $25,000 is matched by EPIcenter, which will also provide business mentors and a challenging curriculum of business classes. Thanks to its ties to FedEx, the program also includes periodic visits from FedEx executives and tours of the logistics headquarters nearby.

“It’s a little like a classroom environment meets a co-working space,” Smith said. “Our secret sauce is probably the deep focus we provide on establishing industry knowledge. We want [the startups] to grow. We just want to recoup enough capital to keep the program going.”

At the end of the EPIcenter program, each team presents its business plan to a panel of investors, business leaders and community supporters at Memphis Demo Day. In addition to OneClickShip, EPIcenter’s 2015 “cohort,” as each year’s accelerator is called, there were three other companies:

• LiLoE, from Washington, D.C., was founded by a U.S. Navy veteran who is working on a solution to the doorstep delivery of unattended packages.
• L7, of Memphis, which is developing an online marketplace for consumer-to-consumer shipping options.
• Thaddeus Medical Devices, founded by a former Mayo Clinic researcher from Rochester, Minn., is developing a device that regulates package temperature.

For Harrell, one of the key benefits of EPIcenter is the ability to test out the processes of his OneClickShip venture with little risk to the startup. “We participated in two export shipments before we built any product,” he said. “This was done through a partnership we formed by networking in the accelerator program. We learned how painful it is to export. Phone calls, faxes, emails, paper documents – it was the most important lesson we could have learned.”