Description
The Preccelerator is founded by the law firm of Stubbs Alderton & Markiles, LLP as a way to show our commitment to the Los Angeles startup ecosystem. SA&M aims to create a long-term relationship with each company to help them avoid pitfalls and strategically assist them on the road to success.
The program is a 6-month term providing: initial capital; 24/7 use of co-working space in Santa Monica; a robust partner perks package worth over $500,000; over 100 mentors that provide value-first mentorship; a customized curriculum each term to meet the needs of the individual cohort companies; and tailored business advisement, fundraising strategy meetings, pitch practice and monthly accountability meetings to measure KPIs, development and fundraising goals. We continually strive to surround the companies with resources to help them succeed.
Eligibility
Participation – Companies are required to be located in the co-working space a minimum of 3 days per week. There are required workshops, accountability meetings and pitch practice sessions. The more companies are in the space, the more we know what needs they have, and can plug in necessary resources. Participation builds comradery amongst the companies.
Engagement – Our goal with the Preccelerator Program is to build long-term relationships with the companies, to assist them throughout their evolutionary path. $25,000 in transactional legal credit through Stubbs Alderton & Markiles, LLP is issued to participating companies in the program. This credit has no expiration date or requirement as to what type of legal services that it can be utilized for. The legal services are rendered under the standard engagement terms of Stubbs Alderton & Markiles, LLP. Non-billable, non-substantive legal advice is also available when companies are in the Preccelerator space, as they meet with on-site attorneys.
Use Agreement – The Use Agreement is a standard code of conduct for use of the office space and participation of the Preccelerator Program. The Use Agreement also includes a required background check for each company team member that utilizes the co-working space. The Use Agreement is given to each accepted company prior to the start of the Program so that it can be reviewed and any questions or concerns can be addressed well in advance of the start of the term.
Is there any equity component?
Yes. In exchange for the benefits of participating in the program we receive a
Warrant to purchase common equity representing 2.5% of the company’s fully diluted capitalization, with a nominal strike price of $100 in the aggregate and a term of 5 years. Those benefits include a $25,000 credit for transactional legal services, use of co-working space, mentorship, strategic introductions and perks that we make available to program participants. The Warrant is non-dilutable through the earlier of the company’s capital raise of $1M and 2 years after issuance. We also provide the Warrant agreement to each accepted applicant well in advance for review so that we can address any questions that arise.
Process
Applications are accepted on a rolling basis. If companies pass the initial application round, they will be contacted to join us for an initial in-person or phone interview so that we can find out more about the company and how we can be a resource to you. If selected, companies will qualify to pitch before our investment committee for a final interview. Accepted participants will be contacted within a week of the final interview.
