Plastered along the otherwise bare wall of the stairwell inside the RAMP building in downtown Roanoke are the logos of the 31 startups that have gone through the technology accelerator over the last five years.
Walking down from her office on the third floor, Mary Miller points to one name after another, their stories committed to memory: This company went out of business. This one merged. This one is on hold. This one is going “gangbusters.” So is this one. This company has clients all over America. This one had to pivot. This one isn’t in existence anymore. This one quit before it finished the program. This one is “fabulous.” So is this one, and this one.
For five years, RAMP – with Miller at the helm – has taken in startups with growth potential and has offered them courses on marketing and intellectual property, introduced them to venture capitalists and mentors, and positioned them for their next phase of business.
Now the accelerator is preparing for a transition of its own. Miller is retiring, and Lisa Garcia, a RAMP instructor and mentor with a background in entrepreneurial education, will take over leadership of the accelerator. RAMP is expanding its offerings to reach promising startups that are not yet ready for an accelerator, and to extend services to those that have graduated. And assuming that the governor signs off on almost $16 million in funding earmarked by the General Assembly, 30,000 square feet of shared lab space will come online in Roanoke in the next two years, a significant boost to RAMP’s growing focus on life science startups.
RAMP Demo Day
CytoRecovery and Axon Acuity will pitch their business ideas live on stage at RAMP’s Demo Day. A reception will follow the presentations.
When: 5-8 p.m. Thursday
Where: Center in the Square’s Ninth Street annex, 1910 Ninth St. S.E., Roanoke
The event is free, but registration is required through RAMP’s website.
It might seem like a lot of changes in a short time. But Miller referred back to a story that she first shared a few years ago at a RAMP gathering, taken from the book “Water the Bamboo” by Greg Bell:
There’s a certain type of giant bamboo – an incredibly strong and long-lasting plant – that shows no signs of growth for years after it is planted. It must be tended to regularly but it gives the farmer no sign that it is even alive.
But it must never be allowed to go dry.
“If you really want to build something sustainable and long-lasting, you’ve got to water the bamboo,” Miller said. “But it’s exhausting. Every day you’re watering the bamboo, and you’re not sure it’s going to leap out of the ground.”
Until one day, after three years, a shoot peeks out – and then within months the plant is 100 feet tall.
The story could apply equally to RAMP’s startups or to RAMP itself: There is no such thing as an overnight success, Garcia said – only years of behind-the-scenes nurturing.
“It resonated for me, because this work is hard and long,” she said. “I feel incredibly fortunate to be stepping into this role at a time when somebody did all the nurturing and the tending of the soil.”
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More than 7,000 startups – including Airbnb and Dropbox – have gone through accelerators in the U.S. over the past 15 years, according to researchers at the University of North Carolina and two other schools.
There’s scarce research into long-term impacts of accelerators, although a study done at the University of New Orleans found that startups that graduated from accelerator programs had an approximately 23% higher survival rate than other new businesses.
The idea for RAMP grew out of regional economic development initiatives including the Innovation Blueprint, which a decade ago recommended the development of an innovation center in downtown Roanoke.
“Looking backwards, it seems obvious now,” said Sam English, a serial technology entrepreneur and early backer of the RAMP plan.
Entrepreneurs and researchers, including those at the then-nascent Virginia Tech Carilion Research Institute (now the Fralin Biomedical Research Institute at VTC), were spinning out promising technology startups, but the region didn’t have the organized infrastructure to support them.
Other places did. Starting around 2005, accelerators began cropping up across the U.S., in the Silicon Valley and Boston and Austin, Texas – and, closer to home, in Richmond. Some took equity stakes in their companies, some were nonprofits. They were different from incubators in that they focused on existing companies that had reached a critical point in their maturity and had significant growth potential.
“The thought was, if we didn’t provide that service here to those companies, especially the ones that were coming out of Carilion and VTC, then they would go elsewhere to get that guidance,” said Marc Nelson, who’s now the city’s economic development director and at the time was special projects coordinator in that office.
RAMP was launched through a partnership of the city, the Roanoke-Blacksburg Technology Council, and Virginia Western Community College and its educational foundation. A building on South Jefferson Street, the former home of Gill Memorial Hospital, was acquired through a land swap between the city and Carilion Clinic, and grants from the state and from GO Virginia helped pay for renovations and programming.
RAMP’s focus on existing companies is what caught Josh May’s attention. His Salem-based Autonomous Flight Technologies had been in business for several years and had more than a hundred customers. But they were mostly small, he said, and he wanted to build the kind of credibility that would allow him to court larger clients for the company’s drone services, like aerial surveying.
Drones were in their early days back then and were often misunderstood, he said;
“People would hear the ‘drones’ and they’d either think that they were these big, bad things that shot missiles at you or that they were hocus-pocus,” he said. “We were trying to change that whole mentality, and RAMP held the keys.”
So he signed on to be part of RAMP’s first cohort in 2017. Today, AFT has four full-time employees and a couple of interns. The company has an R&D side as well and has worked on a number of defense-related projects.
“It was very brave of them to give us their time, to try this out,” Carole Tarrant, coordinator of development at the Virginia Western Community College Educational Foundation, said of those first six companies. “We had no track record, but they took a leap with us. That says a lot about those folks.”
Over the years, RAMP has welcomed startups from across the technology spectrum: companies that developed pharmaceuticals, and food distribution software, and 3D modeling systems, and blockchain applications, and high-frequency communications systems.
By Miller’s tally, about 65% of the companies that have participated in RAMP are still in business in one way or another. Last fall, she said, a survey found six RAMP graduates had each done more than a million dollars in business over the past year.
RAMP doesn’t take an equity stake in its startups. Each company gets a $20,000 non-equity investment – not a lot, Miller said, but enough to help pay for travel to conferences or to visit customers.
A bigger draw for many of the entrepreneurs is the chance to connect with people who have walked the startup road themselves – like Miller, who started a software company in Blacksburg 30 years ago, and whose personal experience shaped how she approached RAMP.
When Miller launched Interactive Design and Development, she also cobbled together her own support system. She went to technology council meetings, met successful entrepreneurs, picked their brains. She got advice from her dad, a retired engineer who helped her set up a bookkeeping system in those pre-QuickBook days. She got to know a banker and a lawyer.
“I met so many generous, knowledgeable people that were further down the road than I was, and I was willing in most cases to be honest and risk looking foolish to ask for help,” she said.
In RAMP, she saw a way to make that journey easier for other startups.
“What we’re trying to do is build community, where people help one another, and people understand,” she said. “They can empathize with your journey.”
Martin Angst, whose company, Rendyr, was in the 2020 cohort, said he and co-founder Kaelum Hasler came to RAMP hoping to fine-tune their business plan – and to get to know people who had been where they are and had come out the other side.
Angst and Hasler met at Virginia Tech, where they had studied architecture and industrial design, respectively. They had an idea for a product – a portable tabletop laser cutter – but neither had any business background.
In part through the customer discovery work that they did through RAMP, they moved away from the idea of marketing to design professionals to focus instead on DIYers and crafters.
They closed on a $1 million financing round last year and raised more than $700,000 through a Kickstarter campaign. The company expects to start shipping the first of its laser cutters, called the Optic, in August.
They’ve connected with mentors, funders and manufacturers, and Angst says he still talks frequently to Rendyr’s RAMP team.
“I’ve been better about thinking about it ahead of time, but I wasn’t used to people always asking, ‘Oh, what can I do for you? How can I help you?’” Angst said. “But it’s something you should always have on your mind in this kind of community.”
The connections have also fostered business partnerships.
Mickey Cowden, whose Cowden Technologies works in robotics and drone technology, went through RAMP last year and got to know two other program graduates, AFT and Corvus Labs.
“Mary Miller told me, ‘You have to talk to Josh May, you have to talk to Josh May,’” Cowden said. “And she said the same thing to him about me, and so we did. I’m really glad she did that, because we hit it off.”
The three companies have submitted funding proposals together, he said, and also have been each others’ vendors.
“We learned a lot from each other, and plan on continuing to work together,” he said.
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In 2020, a nearly $1 million grant from the U.S. Economic Development Administration allowed RAMP to add a second annual cohort, this one focused on life sciences.
Greg Feldmann, who chaired the committee that met to launch RAMP, said the team learned through visiting other accelerator programs that the most successful ones tended toward specialization. It made sense, he said, to capitalize on existing efforts to strengthen a life science cluster in the region.
“We were seeing a number of startups spin up out of places like FBRI or Carilion that were in that arena already, and we feel like having a domain-focused accelerator brings that group together in the acceleration program, so they support one another,” Feldmann said. “Over time, I think it’ll be a point of differentiation for us in the state and in the region, and perhaps even nationally, if we can become really excellent at it.”
There are two startups in this year’s life sciences cohort.
CytoRecovery, which is working to commercialize a benchtop cell-sorting platform for biomedical researchers, launched about four years ago out of a lab at Virginia Tech.
“It’s been really great to connect to the region – the resources in the region, the people in the region – and just have a little more of a presence with everyone,” said Alex Hyler, CytoRecovery’s lead research scientist. “Finally we feel like we can come out of the lab a little bit and start to show it off.”
During an interview last month, she said her team was in the process of doing a series A financing round and was about to make its first sale, she said last month.
“The analogy of a startup is that you’re building a plane but you’re actually flying the plane while you’re building it, and you don’t really know where you’re going,” Hyler said. The connections she’s been building, both with mentors and with other startups, have been reassuring. “You aren’t alone in that struggle of trying to hire a bookkeeper, or whatever your daily struggle might be.”
CytoRecovery’s fellow RAMP startup, Axon Acuity, was founded by Tammy Kemp, a nurse and health care executive who has created a software tool that allows hospitals to track patient needs and nursing staff availability in real time. The company has three employees but no customers yet; Kemp said RAMP’s focus on customer discovery has been helpful, especially since the pandemic has brought significant changes to how health care is delivered.
“It’s not going out and trying to validate what Tammy thinks,” she said. “I have lots of experience in health care, and do I think I’m probably right on some of the major needs because of experience? Sure. But being able to validate that objectively is really important.”
Axon Acuity and CytoRecovery were the only two among all of the startups that applied for this cohort that were ready for RAMP; usually, there are five or six.
“It’s a little bit concerning, and it’s a challenge that we recognize,” Garcia said. “And I think we’re up to it.”
The dearth of accelerator-ready companies could be partially attributable to factors outside RAMP’s control: the pandemic, the Great Resignation, changes in the economy. Garcia has also heard that accelerators across the country have seen a decline in participation, which could signal that there was pent-up demand for accelerators that eased after an initial spike.
But she and others acknowledge that it’s an indication that the region needs to find more ways to nurture early-stage companies, so that the startups that show promise today could be ready for RAMP in another year or two.
The challenge isn’t unique to RAMP. Conaway Haskins, vice president of entrepreneurial ecosystems at Virginia Innovation Partnership Corp., formerly the Center for Innovative Technology, said his team has seen a general increase in pre-accelerator programming across the state as regions respond to the emerging needs of earlier-stage startups.
In the works at RAMP is something they’re calling an Innovation Studio, a space both physical and virtual that will provide wraparound resources for entrepreneurs at all stages of company-building, including both those who already have graduated from the accelerator and those whose ideas are still in the embryonic stage.
“We have so many assets, but it still feels a little bit disorganized on how people navigate it,” said Erin Burcham, president of Verge, a regional technology alliance that brings together the Roanoke-Blacksburg Technology Council, the Valleys Innovation Council and RAMP.
The studio would be a front door for entrepreneurs, she said, a one-stop shop with connections to money, to mentoring, to other acceleration and incubation programs, like the Innovation Commercialization Assistance Program out of George Mason University, which works with very early stage startups, or Virginia Tech’s Link, License, Launch program, which builds connections between industry and research.
Coordination among existing programs will be critical to the studio’s success, Garcia said. Also key, she said: hearing from entrepreneurs about what kinds of services they need so the studio actually serves a purpose – the same kind of customer discovery that RAMP preaches to its startups.
Elliot McAllister, whose company, Skyphos Technologies, was part of RAMP’s second cohort, applauds that fact-finding approach, especially when it comes to entrepreneurs who graduated from an accelerator but still need help, or who abandoned their idea altogether and went back into the workforce.
“At what stages are startups getting stopped?” he asked. Why did they leave? What struggles did they have? What would have kept them in the game?
“We’ve got to be open to being retrospective,” he said.
Based on his own experience, and on what he’s heard from fellow entrepreneurs, he believes that access to money and to real estate are two big hurdles.
Skyphos, which developed micro-3D printing technology used in medical tests, is still in business four years after finishing RAMP, but the company’s trajectory hasn’t been easy. When McAllister left RAMP, he had nowhere to take his fledgling company. He didn’t have the money to rent a building, so he built himself a lab in his Blacksburg garage.
He’s still working out of that same lab. He has customers now, he said, and occasionally has employees. Skyphos needs $500,000 to get to the next level, to be able to hire engineers and technicians. McAllister wonders how many other startups failed, or never got off the ground, because their founders just couldn’t see a way forward.
He appreciates the mentoring and the business experience – and the $20,000 – he got through RAMP, but he thinks there needs to be an increased focus on the post-RAMP life of startups. He’d like to see them supported with low-cost workspaces; one mechanism, he said, might be a competition that would give the winners lab space if they continue to meet certain metrics. Or, he said, there’s the Silicon Valley model: We’ll give you free space, but we get a percentage of your company.
He’d also like to see more help with access to funding; a start might be a summit that brings together entrepreneurs and potential investors, or more money earmarked for startup competitions. Even more broadly, he said, the region needs to be concerned about access to child care and affordable housing.
“We’ve got to somehow buttress this innovation economy,” he said.
Nelson said the RAMP team had worked under the assumption that companies graduating from the accelerator would be robust enough to lease or buy their own space. For the most part, that hasn’t happened, he said. RAMP graduates can stay in the downtown Roanoke building for a year, but that only takes them so far.
“You have to have that next step for these folks to step into,” Nelson said. “You have to be mindful of what happens to those companies at the next step. Do they need a phone? Do they need a mailbox? Are they going to need lab space to be able to do their work? If you don’t provide those things, if their product is viable enough, other cities, other universities, other places will.”
It’s a particular challenge for life sciences startups, which need very specialized space, including wet labs, a commodity that’s in short supply around the region.
The RAMP partners had looked into installing hoods and ventilation systems at the old Gill Memorial building, Nelson said, but it was cost-prohibitive. Some of the startups have been able to borrow lab space in Roanoke or have done their work at the Virginia Tech Corporate Research Center, away from their cohort in downtown Roanoke.
He and others involved with RAMP believe that the new lab project will alleviate at least some of the workspace concerns. As envisioned, 30,000 square feet of flexible, shared lab space will open within the next two years in a building just up South Jefferson Street from RAMP’s headquarters. [Read more about the lab project here and here.]
Feldmann believes the labs will help RAMP but will also serve a broader economic development goal. “It’s like the modern day version of the shell building, especially in this biomedical space,” he said. In addition to giving RAMP companies a place to work, and a place to land after they graduate, it could help attract other biotech researchers and companies to the region, he said.
Burcham is already considering other sectors that RAMP could focus on. Autonomous systems is one; it’s a significant component of a regional application for up to $100 million in project funding through the national Build Back Better Regional Challenge. [Read more about the regional effort here.]
Feldmann, who led Verge before Burcham took on the role early this year, believes that acceleration programs like RAMP that focus on creating – and maintaining – jobs in Virginia will be critical for the state’s longer-range economic well-being.
“We’re in a time where there’s more awakening to the need for Virginia as a whole state to participate in this innovation economy or be left behind,” he said. According to the Brookings Institution, 90% of the nation’s innovation-sector employment growth in the last 15 years came in just five cities – with the closest, Boston, nearly 700 miles from Roanoke.
“That concentration – if we aren’t intentional about reversing that – you’re going to be left behind as an area,” he said. “People need to understand that acceleration programs – really strong, well-funded acceleration programs – are an absolute table-stake necessity if you want to play in this space long term.”
He thinks RAMP has made “really nice strides” in the last five years, particularly considering the curveball thrown by the pandemic.
“We’re still in an embryonic phase in a lot of ways,” Feldmann said. “Five years is a wonderful milestone to celebrate, but we’ve got a lot of work to do ahead of us to really cement this area as a great place for a vibrant startup opportunity.”