Fledge, which is taking a TechStars-like approach to incubating startups that make the world a better place, has landed $307,000 in financing that it will use to bankroll its next group of companies. Fledge is kicking off its second class on February 18th, accepting seven new companies into the incubator at the HUB Seattle in Pioneer Square.

Companies receive $10,000 in financing after being accepted into the program, with Fledge taking a six percent equity stake. Led by Seattle entrepreneur Michael “Luni” Libes, Fledge is one of a handful of specialized incubators emerging in the Pacific Northwest. Last month, we wrote about Bellevue’s 9Mile Labs, which is looking to incubate startups in the enterprise software category.

Libes says that “socially conscious” companies often get overlooked, even though a growing number of people identity themselves as environmentally, health or community conscious.

Luni Libes

A multitude of entrepreneurs aim to fulfill the unmet needs of these ‘conscious consumers.’ However, the entrepreneurial infrastructure in Seattle and elsewhere is focused on accelerating ‘tech’  — software, biotech and cleantech startups,” said Libes, who previously co-founded GroundTruth, Medio Systems and Nimble Corp. “In fact, most of that infrastructure, inclusive of venture capital and other institutional funding, filters their decisions based on whether a company is tech-centric or not.”

Fledge is different than some incubators that take straight equity, in part because it also gets paid out through what is known as “revenue-based financing.” That means Fledge receives some of its investment back as the portfolio companies generate revenue, meaning the organization doesn’t have to wait for an exit in order to generate a return. It does not make follow-on investments.

Investors in the startup incubator, located in the HUB Seattle, include former Microsoft executive Brian Arbogast; Walk Score Chairman Mike Mathieu former RealNetworks executive Dave Richards and others. Libes said that Fledge should be able to reach sustainable operations if it raises $2.2 million, meaning it could make investments in new companies for 10 years. 

“We expect to continue raising money for another year or two to reach our goal,” he said. 

Fledge has already seen some success. One of the graduates of the incubator’s inaugural program, clean-burning cookstove maker BURN Manufacturing, just raised $4 million in new funding from General Electric and the U.S. Overseas Private Investment Corporation. The deal was announced by Outgoing Secretary of State Hillary Clinton, with the money being used to create an assembly factory in Kenya that could support as many as 200 workers in Africa as well as 20 new jobs in Washington state.

“Clean cookstoves are a relatively simple technology capable of having a far-reaching, positive impact on both human health and the environment,” said OPIC President and CEO Elizabeth Littlefield in a release.  “Thousands of people in East Africa will enjoy healthier lives thanks to this innovative project, the result of an outstanding partnership between BURN Manufacturing, GE  and OPIC.” As part of the deal, OPIC is providing a $3 million loan, with GE investing $1 million.

Previously on GeekWireFledglings take flight: These 7 startups are looking to make the world a better place

 

Comments

  • ChetCrunch

    Congrats to Fledge on the start, and good luck on raising more money to become sustainable. Seattle is the perfect place for an incubator like this, and I’m excited to follow you guys and see what kinds of things come out of your incubator!

  • lunarmobiscuit

    Thanks John. If any readers would like to stop by, meet the teams, and provide some startup advice, stop on by HUB Seattle in Pioneer Square.

  • ChuksOnwuneme

    Really awesome, Luni! Thank you for believing in the ‘conscious’ movement, and giving it a platform to take flight! It is the start of great things to come. The world is watching —

  • brook

    We love to hear great news of people not ‘trying’ to make the system better, but by actually setting out to do so from the beginning

    At shiftalliance (http://www.shiftalliance.com/index.html), we talk a lot about this very topic and have pulled together years of experience, research and technology to look at business in a more meaningful way. Our goal is to help companies thrive through better practices, that stem from a holistic approach to create meaning from employees,vendors, communities, leaders, and the global reach.

    We would love to continue this conversation regarding specific pain points or broad organizational infrastructure should your organization be looking to create more meaning, for a better world and a better way of doing business.

  • Rich

    Social-conscious business needs this type of capital support. We had to bootstrap it with Distant Village back in 2000. Hmmm… we should propose a new innovative concept in sustainable packaging, which might be a great fit…. :-)

  • Brian Setzler, CPA

    Congratulations and best wishes. This sounds exciting.

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