One of the startups in the latest round of seed funding dolled out by Democratic incubator Higher Ground Labs began life four years ago as a DIY mail firm.
The selection of SpeakEasy Political, an offshoot of the San Francisco-based Storefront Political Media, shows how far HGL’s influence is extending into the Democratic side of the industry.
In its first two rounds of investment starting in June 2017, HGL invested $5 million into 27 progressive startups. The group said those picks were validated by the marketplace.
It noted that last cycle, “every federal campaign used at least one of our start-ups, as did over 3,000 down-ballot campaigns.”
It’s now planning to invest $6 million of a $10 million fund in “follow-on funding” in some of those companies over the next two years. Those cash infusions will range from $500,000 to $2 million.
Companies selected for the new “accelerator class" cohort announced Thursday will receive a share of $1.4 million.
That will go to Speakeasy and 10 other companies, which “collectively address misinformation and false-media, strengthen data analytics, integrate and measure performance [and] proliferate creative content.”
In addition to the funding, which the LLC provides in exchange for equity, HGL offers mentorship and coaching during a six-month Accelerator program. That’s one of the most attractive elements of the tie-up, according to Bergen Kenny, SpeakEasy's chief executive and co-founder.
“It’s always helpful to have feedback and a fresh set of eyes,” she told C&E. “We’re a West Coast-based firm, they are based primarily in DC, for us, it was enormously helpful to be connected in that way.”
While Speakeasy began life as a DIY mail platform, it’s since expanded to incorporate DIY digital ads as an offering for its clients, which include down-ballot campaigns.
Kenny said that her company’s low-cost offerings for clients running at all levels are what appealed to HGL’s leadership.
She said the investment they received, which is in the ballpark of $100,000, will help them scale the business. “We want to hugely expand the amount of creative on our site,” she said. “This investment will help us make our product easier to use and get broader market adoption.”
Other recipients include the civic tech company Countable, Main Street One, which helps groups and campaigns respond to fake news, the canvassing app OpenField, OutFox AI, a Facebook ad buying platform, Outvote, a “a P2P engagement platform,” the research shop PredictWise, Survey 160, a company that conducts SMS surveys, Torch, which provides social listening, software firm Warchest, an analytics firm, and Wethos, which provides “teams of freelance specialists” to nonprofits.
During an appearance at C&E’s CampaignTech East in DC in April, HGL Co-Founder Shomik Dutta described what they look for in startups.
“Generally, we invest behind a thesis that’s supported by a landscape analysis that we conduct once a year,” he said, noting that 75 percent of their capital is invested through that criteria.
“Largely, we’re looking really driven, really smart founders with a kernel of an idea,” he said. “The idea is that at the seed stage, you need little more than a relatively small amount of start-up capital and a lot of programming to put you into the bloodstream of the political landscape as quickly as possible”