When Rich Lunak first came to Innovation Works in 2005, fewer than 100 startups per year would approach the organization for help. Now marking its 20th anniversary, the seed investment engine has blown past those early numbers, to the benefit of the Pittsburgh startup community.
“We will see over 700 this year. Our investment over the last 10 years is up over 200 percent,” said the president and CEO. “Those types of signs, of our impact, are all over the place.”
IW has worked with more than 1,000 early-stage companies, including investing some $78 million in more than 300 startups.
It also launched the AlphaLab and AlphaLab Gear accelerators and has been a major driver of innovation in the Pittsburgh region, helping create or retain almost 12,000 jobs by its estimation. This year, AlphaLab is marking its 10th anniversary and AlphaLab Gear is about to turn five years old, as is IW’s venture arm, Riverfront Ventures.
“Pittsburgh has come from a nascent stage to being a center for entrepreneurship and tech,” Lunak said. “We still have a ways to go but we’re not resting on our laurels. Looking at the last 20 years, we have a lot to be proud of.”
While you’ve probably heard of many of IW’s companies, you may not realize that IW is behind them. And even though they sometimes feel like parents watching their kids leave the nest, Lunak said the organization is happy to play a behind-the-scenes role to help its startups succeed.
“We’re sort of an atypical organization, in that our marketing efforts are spent promoting the stories of the companies we support and why our region such a phenomenal place to grow build and nurture a tech product,” he said. “At the end of the day, it’s about what the companies are accomplishing.”
"We're very conscious of the human impact side of the equation, but also trying to help them build a viable fast-growing business. We try to provide critical resources when companies are at their most fragile point."
Those companies include many in the civic arena, including Startable Pittsburgh, which has trained more than 100 Pittsburgh-area teenagers in engineering and selling a product; Civic Science, which provides polling and data gathering tools for organizations; Flexable Care, which provides pop-up childcare at tech events; and Thread International, which makes consumer products out of recycled plastic waste and is currently hosting an already super-successful Kickstarter campaign to fund its new line of recycled backpacks.
Flexable cofounder Jessica Strong said IW’s investment and support were crucial to its growth, allowing her and cofounder Priya Amin to move past the early stage and help make connections with investors. But it was more than providing access to capital, she said.
“The other huge benefit is having access to mentors to help walk us through testing and refining our ideas for services, pricing and next markets,” she said.
IW also helped legitimize their business in a subtler way, Strong added, “promoting inclusivity by having childcare at all of their events,” including its 20th anniversary gathering last week.
Working with civic-oriented companies is not all that different from working with more traditional for-profit startups, Lunak said.
“When we work with a company like that, we’re very conscious of the human impact side of the equation, but also trying to help them build a viable fast-growing business,” Lunak said. “We try to provide critical resources when companies are at their most fragile point, whether that’s an investment to help build the initial product, access to networks and investors, or other kinds of resources.”
That includes tapping into Pittsburgh’s local talent pipeline; according to its figures, 86 percent of IW portfolio companies have some or most of their vendors in Pittsburgh, and 29 percent have technology licensed from a local university.
Pittsburgh’s tech and innovation community is very broad and inclusive, Lunak added, something that IW hopes to continue to build on.