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News  26, Jun 2013

JFDI opens 3rd class with more focus on mentorship instead of funding

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jfdiJFDI.Asia is calling for its third batch of startups. Less funding this time round but the team believes that the focus should be on the mentorship.

Singapore based incubator The Joyful Frog Digital Incubator (JFDI.Asia), is now accepting applications from startups looking to be part of their 2013 Class B. Purely on the basis of merit, 12 teams from anywhere in the world will be offered a place in the next program.

Scheduled to start in August, JFDI shared that they have more than 280 teams who have already indicated their interest in the 100 day program. In exchange for a minority equity stake, every team joining will be offered a package including S$15,000 (USD 11,700) net cash, mentoring valued at S$150,000 (USD 117,000), technical and other vendor perks worth S$300,000 (USD 234,000) and working space for the duration of the program.

Teams applying to JFDI.Asia range from raw startups with just an idea, to companies that already have significant user numbers and prior investment. The program favours technology businesses that can demonstrate a real connection to Asia. All teams accepted are required to incorporate (or re-incorporate) in Singapore.

Cash is not the reason you would bring a startup to JFDI.Asia

Unlike its direct alumni in the 2013A class which received S$25,000, the 2013B class will only be given S$15,000 cash. When asked what was the reason behind the reduction in funding, CEO and co-founder Hugh Mason told us that the value add they offer is in the mentoring.

“We are still trying to work out what’s a reasonable level of cash to provide, particularly to foreign teams that need to cover the cost of living here. In 2012 we offered S$15,000 and that seemed to work out but people said it was tough, so in 2013A we gave them S$25,000. In practice the 2013A teams didn’t seem to be deploying the additional S$10,000, so we decided to fund more startups with the capital we have rather than giving them cash they don’t use.”

We also want to send a signal that cash is not the reason you would bring a startup to JFDI.Asia. There are plenty of government schemes here that give more in grant money for local companies. The value add we offer is the mentoring.”

We spoke to Ariff Munshi, CEO of UserScout which recently graduated from JFDI. Ariff echoed Hugh’s statement saying that S$15,000 should be enough to sustain a team in the 100 days program.

Ariff however cautioned the can speak for teams based locally in Singapore, but might be challenging for a foreign team. While the new terms will no doubt be tough on new teams, it should not be a deal breaker. “I guess it would benefit best a team at the very early stage or idea/product conceptualization. If the founder is willing enough, he will always find ways to find money and keep the business running.”

Companies accepted into JFDI will be valued using the following guideline by JFDI:

By end of the class 2013B, JFDI told us that they will have deployed all the capital they raised to date. A quick calculation revealed that the total amount of capital they will have invested in their three batches of startups turn out to be around half a million Singapore Dollars.

Because of this, JFDI is currently discussing with their existing shareholders and some new funds and individuals who are interested to see where everyone wants to go for the future.

“It seems that the model works so broadly it looks like there are two options – raise $1 million or so and do another two or three batches in 2014, or we might try to raise a much larger fund and do, say, 250 startups by the end of 2017. Or we could move more to a model like 500 startups where we do some kind of follow-on investments alongside others, ‘doubling down’ on the teams that seem to be gaining most traction,”  said Hugh.

Read also: JFDI Season 1: 7 Funded, US$3.1M raised, 33 jobs created

Exploring several revenue streams

Other than it’s accelerator program, JFDI also generates some revenue from its Cafe membership (S$96 per month), incubation space (S$384 for hotdesk and S$512 for dedicated space), as well as short courses for the public. With its new batch intake announcement, the new admission process also provides an option for teams to get comprehensive individual startup assessment for a small fee. The feedback will be delivered via the “Frog Score” – an interactive infographic that shows startups how they compare to other applicants on 36 dimensions including team strength and idea.

Teams interested in applying to JFDI.Asia can learn more at http://jfdi.asia/accelerator/

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Jacky Yap

Jacky Yap

Having spent one year abroad in Shanghai under the NUS Overseas College Programme, Jacky has an avid interest in entrepreneurship and web based startups. Jacky used to run N-House, Singapore's first entrepreneurial themed residence in NUS, and was also part of the organizing team for Startup Weekend Singapore 2012. You can reach him at jacky [at] e27 [dot] co

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