Codefi 1ST50K winners talk startup life in Southeast Missouri
Southeast Missouri has quickly made an impact on entrepreneurs at four startups who won Codefi’s 1st50K competition, and it goes deeper than the region being a nice and affordable place to live.
The 1ST50K competition awards $50,000 equity-free to innovative startups. In August, Codefi’s sixth annual competition brought four new technology companies to town.
The developers of SportsTrace, Swipesum, Upswot and Venku will each receive $50,000 as well as membership in Codefi, access to venture capital and angel investment networks, business coaching and mentorship and will each relocate to Cape Girardeau as part of the 12-month long program.
“We try to attract high quality companies, companies that have a strategic alignment with something here that will increase the reasonability that they would stay and keep hiring more people,” James Stapleton, co-founder of Codefi, said regarding the selection process.
Max Montrey is the co-founder of SportsTrace, which analyzes uploaded video from athletes to provide personalized recommendations. He said working at Codefi has been “amazing.”
“I’ve literally been all over the world and have seen both dedicated office spaces and coworking spaces,” Monterey said. “This place is absolutely top notch. My co-founder and I were just joking about the fact that we’ve never been anywhere, and this includes on the Microsoft campus, with the Internet so fast.”
Michael Seaman is the founder and CEO of Swipesum, a company that optimizes credit card processing solutions for businesses. He said the help received from Codefi has been far more than other places they’ve worked, calling that engagement their secret sauce.
“I wouldn’t be surprised if next year they’ll have twice the companies who are twice as successful as us,” Seaman told B Magazine.
Upswot is a financial technology startup that provides a platform for financial institutions to increase sales and marketing insights for business banking customers through data collection. The company is nearing its two-year anniversary.
“If I was James [Stapleton] or Chris [Carnell] (co-founders of Codefi), I would do the same [model],” Upswot founder and CEO Dmitry Norenko said. “I hire people. I teach them. I hire more people. I become the mentor. This is a very cool way to grow the community.”
Venku is an Airbnb-type service for people looking for outdoor experiences offering adventures in 48 states and abroad from hog hunting out of a helicopter to tagging sharks in Texas. Venku’s founder Murielle Gaither is from Cape Girardeau, so her perspective is a bit different from the other three founders. But she is seeing her hometown through a different lens as a startup entrepreneur.
“One of the things that’s impressed me the most about working with the Codefi team is that many of the other teams we’ve worked with, there’s ego involved, and with Codefi, egos get checked at the door,” Gaither said.
The 1ST50K program has brought eight startup companies to the area. Seven of these companies have decided to stay longer than the 12 months required by the program.
Stapleton explained that Codefi’s approach is unique compared to other tech startup support programs normally found in large cities.
“First, we customize our program for the needs of each company,” Stapleton said. “We focus on rolling our sleeves up and helping the businesses grow. We aren’t economic or community development folks — we have experience with what these companies are going through and can work with them to make a meaningful impact on specific growth objectives. Secondly, we also have software development expertise and have created successful training programs that provide a much sought after supply of digital talent to founders of software-based companies.”
In a coworking environment, the startup founders can get quick answers from other business owners.
“I love the idea of having access to the tech community both physically in-person and virtually,” Monterey said. He added the founders of Codefi have created a community that fosters interaction between company founders.
They pool their experiences, successes and failures in order to help one another grow.
Monterey added, “People come by and have questions like, ‘How would you reach out to a customer? How would you talk to this person or do you know anything about this code?’”
Gaither also likes the ability to bounce ideas around and use each other’s contacts.
“I can come and address a question, and if they haven’t personally experienced the concern, maybe they can connect me with somebody who has, which may help curtail the learning curve a little bit,” she said.
The founders all appreciate the relatively low cost of living, and, according to Stapleton, the quiet atmosphere allows the companies to focus without as many distractions.
The COVID-19 pandemic has resulted in many business events and meetings being held virtually. As a result, numerous businesses have recognized that operating virtually can be a benefit, and that they can be located anywhere — including Southeast Missouri.
How did Codefi cultivate an environment to entice startups to Cape Girardeau, outside typical hubs like New York, Silicon Valley and San Francisco?
Stapleton explained that Codefi and their small number of partners have worked for six years to create an ecosystem that is attractive to founders of high growth digital companies.
“This is the coolest part for startups,” said Upswot’s Dmitry Norenko. “It’s really not necessary to be in the most expensive parts of the world.”
He added that although the $50,000 prize is nice, locating from San Francisco to Cape wasn’t about the money.
“We were looking for an equitable place to support our English-speaking clients, a place where there is a university, an equitable place not far away from a large international airport since we are an international company,” Norenko said. “This is what we were looking for. And we found it in Cape.”
SportsTrace started out in Seattle, home to technology companies Amazon, Microsoft and T Mobile and mega coffee chain Starbucks.
“But here, being able to get plugged in so quickly and see the immediate effects of that engagement is a pretty incredible feeling” Monterey said.
Although the $50,000 helped them hire their first employee once they got to Cape Girardeau, SportsTrace’s decision to come to Southeast Missouri was all about the community and location.
“We were already looking for a more central place that we can do business in the U.S.,” Monterey said. “This is a great opportunity, and I’m doing it in a great place.”
Gaither thinks Cape Girardeau is underestimated.
“We’re living in a very interesting time when all you need is access to high quality Internet for a lot of people to do their jobs,” she said. “Especially because of COVID, we’re seeing something really interesting happening with people returning to communities like this or moving to communities like this because of such a high quality of life.”
Monterey and fellow co-founder of SportsTrace Alex Gardner — both of whom came from Microsoft — are as interested in providing impact to others as they are in receiving one as a company. One example is their communication with students in the Southeast Missouri State University computer science club.
Seaman believes in learning about and being customers of the businesses inside Codefi and exchanging ideas with them. “I’m trying to take advantage of such good creatives here, and use some of their stuff for our company,” he said.
Swipesum, Seaman said, is really good at sales, which is an area he’s able to provide value to other companies.
“I think the whole community will realize that even companies from this group … these could quickly be the largest employers or major contributors to the local economy,” Seaman said.
Stapleton said much of his job is helping these companies grow.
“Most of the companies we work with now are far enough along that it’s not early stage mentoring and coaching or development of their product,” he said. “It’s more about how we connect them, how we find customers for them.”
Stapleton said COVID-19 has made many companies reconsider where they need to be located, and that you don’t have to reside in “one of the hot spots of the startup world” to find success.
“And our job is to make sure that we’re credible, and we can really help those companies grow. Because when they get here, they start hiring people. They start spending money in the community,” he said.
Life in Cape
Upswot’s Norenko emphasized they will be in Cape Girardeau longer than the year they’ve committed to as part of the 1ST50K program. He sees the area as part of their long-term success.
“We will become engaged with the people of Cape Girardeau,” he said. “To replicate the people of Cape Girardeau to any other place, that will difficult. And why should we do this?”
The more time Norenko’s team spends in Cape, the less chance they will leave. He added, “We will become dependent on Cape Girardeau. The more people we will hire, the more resources we invest in real estate relocating my guys from Europe, the more we become dependent on the town.”
For Venku, Gaither said the most important thing is to find people who identify with the audience, whether it’s talking to a host or to a customer who’s looking to book a hunting or fishing package. The ability to speak their language and use the same lingo is key.
“We have everything we need here,” she said.
Seaman’s wife is from Sikeston, so he knew of Cape Girardeau as a place they would pass on the highway. But living here, he appreciates the beauty of the town and its history.
“We definitely have visited most of the wineries. Before moving here and now, we are trying to visit all the state parks,” Seaman said, adding as “foodies” they are having fun finding the best hidden eateries.
For Montrey, Cape Girardeau brings him “a little bit of calm” from working in Seattle. Plus, he said there’s no stressful commute. “In fact, a couple of times I’ve actually walked to work, which is just bananas where I come from.”
There is a developing theme among the four entrepreneurs. Fellow startups support each other; there is a cost of living benefit to living in Southeast Missouri; and the mentorship to grow their businesses is available. Technology enables growing tech startups to thrive without having to locate in Silicon Valley. For these entrepreneurs, it’s what they need both now and in the years ahead.
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