From early days to scaleup: The future of B2B immersive startupsPosted 9 Jul 2020
Starting up and scaling a business is hard, even more so during the current Covid-19 pandemic. Startup founders now face difficult market conditions as the investment landscape continues changing and many industries take a hard hit. Digital Catapult has adapted its acceleration programmes, including Augmentor which supports emerging immersive products and services, to assist companies in navigating this challenging period.
The past few months posed a high level of uncertainty for immersive companies, impacted by cancelled events and festivals and an increased level of fear around the use of immersive devices, alongside the normal challenges of maturing their product offerings and acquiring new customers. However, the current situation has also created a positive impact as it boosted interest in many emerging technologies, including immersive. We’ve seen immersive technology solutions being used as a response mechanism to the pandemic across healthcare, education and remote working. With broader adoption, immersive technologies can gain further momentum which could lead to its long-lasting industry establishment.
Nevertheless, multiple immersive market barriers such as poor investor confidence, lack of awareness of immersive return on investment (ROI) and slow consumer adoption, still hover over the industry and addressing them remains as pertinent as ever. As overcoming barriers may take time, it is essential to support immersive companies in driving their development and commercialisation further, as well as help boost the UK immersive economy. To address some of these barriers, Digital Catapult launched the Augmentor acceleration programme aimed at supporting early stage B2B startups in becoming more commercially viable and investment ready.
Since its launch in 2017, Augmentor has helped 26 early-stage startups kickstart their growth over three cohorts. The vast majority of the startups on the programme had not raised investment before joining Augmentor, and the programme enabled cohorts to secure £6.5 million in private investment and £1.4 million in grants*.
To illustrate the programme’s value and share new changes planned to drive even further investor interest, Digital Catapult organised fireside chats together with the programme’s partners, mentors and alumni. Key highlights from these sessions follow below:
Fundraising for startups – what are the options and how they work
Money, or better, the lack of it, is one of the key challenges that early-stage startups face. Augmentor provides startups with key investment and funding support so they can figure out the best options, understand the fundraising process and meet potential investors.
As emphasised by Dave Haynes from HTC Vive, who has already invested in three of the programme’s startups, this support shapes startups’ solutions into scalable and customer focused platforms which increases their sales potential. For some Augmentor alumni like Gravity Sketch, Reality Zero One, HoloMe and Artificial Artists it even allowed them to close their first investment rounds. “Augmentor was the perfect platform for us to secure the investment we needed.” Ben Cyzer, co-founder of Artificial Artists, stated.
As immersive investment recently took a big hit and dropped to 2013 levels, Augmentor has redesigned its support and put emphasis on access to different financing options (from equity investment to grants). Immerse UK’s involvement also educates and encourages the cohort startups to explore available R&D options and help them shape winning applications.
The importance of business strategy and achievable targets
Immersive startups have different needs, depending on the industry in which they operate, and founders have to focus on the goals they’re setting up for long-term. As Augmentor alumni Bodyswaps highlighted in the webinar panel “lead with the problem, not the technology” and use the programme not just as a way to get funding, but also as an amazing learning opportunity.
Augmentor’s access to a variety of experts that help startups build a business strategy and guide them in understanding how to acquire their first clients can be game changing. For many startups, including Bodyswaps, Augmentor was a pivotal moment as it allowed them to shift from their initial virtual reality (VR) university ideas to current solutions, in Bodyswaps’ case a VR social skills learning platform.
Part of Augmentor’s focus is to help startups translate ideas and vision into an appealing story, whether speaking with a potential employee, customer or investor.
The power of network and mentorship
A strong business network can lead to new business opportunities, valuable feedback and potential partners. For this reason, Augmentor connects startups with pertinent contacts in Digital Catapult’s network, ranging from universities to businesses and helps them form long-lasting relationships through mentorship.
“The mentorship from Digital Catapult is one of the best experiences I have had – and this lies at the core of its success” is how Christophe Mallet, the founder of Bodyswaps described the experience and often these mentorship relationships continue beyond the programme.
This was exactly the case for alumni mentee, Kate Parkinson from Also Known As and mentor Nelly Lavielle, partner at Bethnal Green Ventures who underlined that a clear structured approach to mentorship with set objectives from the beginning and embraced accountability is what set the relationship up for success.
Similarly, understanding the value that mentors bring and tailoring that towards startups’ needs is what takes the relationship to another level. To get the most out, Augmentor encourages startups to own these relationships and be open to ask questions.
Sharing the Augmentor cohort experience with other founders facing similar problems can spread learnings. On her recent experience of peer support in a cohort startup, Parkinson described it as one of the key drivers that made her challenging startup founder life less daunting, “We found the peer support very useful, we still have regular catch ups with the people that were in the cohort.”
Augmentor’s open call is now live until Wednesday, 29 July and will be running once again to equip immersive B2B startups with the best strategies and expert advice to help achieve success and cope amid the coronavirus pandemic.
To re-watch the webinar, click here.
To apply to Augmentor, visit Augmentor Open Call.
* This data highlights the achievements of the 16 startups that went through the first two years of the programme.