Russ: Welcome back to The BusinessMakers Show, heard on the radio and seen online at thebusinessmakers.com, brought to you by Comcast Business, built for business, coming to you today from the Surge Accelerator, where my guest is the cofounder and managing director, Kirk Coburn. Kirk, welcome back to The Businessmakers Show.
Kirk: Thanks, Russ. How are you?
Russ: I'm doing great. Here you are on a class three, which I want to get into in detail. But before we do that, just give us an overview, what is Surge Accelerator?
Kirk: We are an early stage venture fund where we invest in energy technology companies. And we actually fly them in from all over the world to house and locate with us for three months. And we kind of beat up on them, we connect them to customers and we connect them to other capital sources besides theirselves.
Russ: And then set them free and hopefully they're real successful.
Kirk: Yeah. Yeah, exactly. And hopefully they make a lot of money and they pay us.
Russ: Right. Okay. Well, it's kind of interesting, you know, the technology in the energy space is so evolving rapidly.
Kirk: Right. Right.
Russ: At the same time I think there's still that chasm that you have to get over to actually commercialize it. So do these people show up knowing that it's going to be a challenge to get out there and get successful in this space?
Kirk: Well, I think they all come in thinking that they've already solved those problems, and they quickly realize they haven't. But that's the, you know, the dream of the entrepreneur, right? You know, ultimately they're here to figure all this stuff out, and that's why we spend three months with them, is to - I mean "babysit" is probably not the right word, but we do that.
Russ: You know, I remember, here we are, class three. So you're on your third year and you just rolled back 2.5 years. And the energy space was hot, 'cause there's always been incredible technology there, but man, oh man has it ever jumped forward on the supply side with the shale exploration, which has changed everything. I mean, you know, we sort of have abundance now and it can make other sort of energy sources even a bit more challenging to be commercially viable.
Kirk: Well, for the first time in our lifetime has the market and the technology been in one place. And so that's really why it's a game-changer.
Russ: Oh yeah, absolutely. And you talk about one place, man, Houston, Texas is described more today than ever as the Energy Capital of the World. So you're obviously in the right place.
Kirk: Right. We agree. Ditto. You know, right.
Russ: And it seems like, I mean I've talked with quite a few of your new class three companies, they know that too. And then I had two or three of them that moved here from far away. You got them here. So you got them here, but it almost sounds like they're probably going to be here to stay.
Kirk: Well, we're seeing a lot of companies from Silicon Valley come here through Surge, or even outside of Surge, but coming through Surge offices to say, "Hey, we know this is where we need to do business." No matter where you are in the world, if you want to make a difference this is where all the customers are going to be, so you have to be here.
Russ: Give us a little overview of class one and two, how they're faring once you've set them free to fly.
Kirk: Right. Well, so far 21 out of 23 companies are still in business, which is really a good sign.
Russ: That's - that's success.
Kirk: I mean this early. They've gone on to raise over $25 million in funding which again, for early stage we're the leading accelerators in the world when it comes to just the amount of money that these companies are raising. And they're landing significant customer traction, which in oil and gas primarily which you have it's heavy enterprise, they're very skeptical about doing business with younger companies and people they don't know, those are some really good statistics.
Russ: I totally concur. So give us an overview of class three.
Kirk: Sorry, class one and two, but this is probably the best class we've ever had. These entrepreneurs are fantastic, super-bright. Many of them already have significant traction; they've either raised money in the past or they're raising money as we speak, and they're doing things across the entire energy spectrum that could completely change the game to much degree. So we're super-excited this year.
Russ: Well, I noticed a couple of them focused on the grid and how that world is changing and sort of trading power. I've noticed some more-than-normal mobile apps seem to be making it into the space today too.
Kirk: Sure. Sure.
Russ: And I always notice this here, but as sort of a positive eager outlook, but I'm curious, you know, when you come in here and you look at it, it's a great work environment. You're kind of like a coach, a football coach or a teacher or something, and you've got good players and hard workers and some that don't work hard. How do you do that from your position? I mean do you let them know if you don't think - it doesn't look like they're putting in a good day?
Kirk: You know, we talk a lot about being entrepreneur-led, and I'm an entrepreneur first, which I think means I'm harder on them than they would otherwise get from someone else.
Russ: Right. Because I've been in the trenches.
Kirk: And so I'm not necessarily - I tell them, "I'm not your friend. I'm here to help you." And we warn them too, and so we tell them, "Hey, don't come here because if you really want to know whether you're going to have something that's good or you're a good entrepreneur, you're going to find out in three months. If you're good you're going to withstand it and thrive," as we've seen in surge one and two. If you're not good you're going to wilt and, you know, again, we talk about failing fast, this is the place to do it.
Russ: Okay. I've also noticed, I've only been here during the week. Are there people here on the weekend too?
Kirk: Well, you know, we're rigged with cameras and-
Russ: [Laughter] So you know.
Kirk: So they're actually literally - my phone lights up in the middle of the night, 'cause I get notices when people open the door, but people are here at 1:00, 2:00, 3:00 in the morning.
Russ: That's great.
Kirk: Which is different from the last two years. So I think our companies are working harder than ever.
Russ: That's great.
Kirk: So I think - hopefully that's a good sign.
Russ: That's great. Well, I really appreciate the update, and good luck with class three.
Kirk: Sure. Thank you.
Russ: You bet. All right. And that wraps up my discussion with Kirk Coburn, Cofounder and Managing Director of Surge Accelerator. This is The Businessmakers Show, heard on the radio, seen online at thebusinessmakers.com, brought to you by Comcast Business, built for business.