After raising a $44.2 million Series B round last June, LittleBits, a five-year-old startup that makes electronic building blocks, wanted to find a way to increase its international reach.
So it took an unusual step for a startup of its size: It applied to an accelerator. But not just any accelerator--the one run by the international juggernaut that is the Walt Disney Company. It was a no-brainer for LittleBits, CEO Ayah Bdeir explains--it currently sells its product in 130 countries, and works with more than 3,500 schools.
"LittleBits is a company that's universal--it crosses boundaries of nationality, language, age, and space," Bdeir says.
Earlier this week, Disney announced the list of startups that made it into the 2016 class of its accelerator program, now in its third year. But this year, the media giant took a sharply different approach when handing out the much-coveted golden tickets.
For one thing, the companies that Disney selected are bigger--the list includes startups that have already raised tens or hundreds of millions of dollars in venture capital, such as LittleBits, VR startup Jaunt, and open-network publishing platform Playbuzz. Additionally, Disney is no longer capping the amount of money it invests in each startup at $120,000, which it had done for the past two years, reports TechCrunch. Disney also declined to renew its contract with Techstars, which had helped run the accelerator for the past two years. A Techstars spokesman told Inc.: "We're glad to see their [Disney's] ongoing commitment to innovation through their own accelerator program, and we continue to fully support our alumni from past programs with them."
Disney declined to reveal how much it invested in each startup--but with bigger companies involved, one can imagine that the investments are much larger.
"The accelerator is taking a different direction," Michael Abrams, the senior vice president of innovation at Disney, acknowledges. "We realized that we had the opportunity this year to leverage the Disney Accelerator framework, and apply that to a much broader array of innovative companies."
With or without startups, Disney has plenty of resources at its beck and call to develop new technology. The company has multiple departments dedicated to creating cool new gadgets. In the past year, for instance, Disney's research department has worked with other organizations to develop smart paper that can react to gestures, and a robot that can walk up walls.
But as startups like Oculus and SpaceX continue to dominate headlines for their breakthroughs in virtual reality and space transportation, the company responsible for the first animated feature-length film and the first multiplane camera can no longer rely on in-house creations to stay innovative. And as this week's newest viral sensation, Pokémon Go, proved, using popular corporate-created characters to introduce innovative new technology can be fruitful. (The game is the result of a collaboration between software startup Niantic and the Nintendo company.)
Disney remains tightlipped about what the accelerator entails for this year's cohort. But it seems that the program is primarily focused on building relationships with Disney's executive team, and teaching startups how to reach more markets in the media and entertainment fields.
Artificial intelligence startup StatMuse, which created a natural language processing platform to help sports fans search for player stats, made it into Disney's accelerator program last year. It was a transformative experience for the then one-year-old startup: It had only three employees at the time and had yet to raise any money. The company closed a $10 million Series A round shortly after finishing the program, which enabled it to operate without a paywall and to launch the first public version of its product. It also signed a deal with Walt Disney-owned ESPN to provide statistics during the 2015-2016 NBA season.
"We went from getting ready to charge fantasy players to research, to realizing that there's significantly more that we can do with our platform," StatMuse CEO and co-founder Eli Dawson says.
With Disney's new focus on later-stage companies, its unlikely that future Disney accelerators will include Cinderella stories like StatMuse. Instead, get ready to see well-known up-and-coming tech companies pulled under the Disney umbrella.
Correction: An earlier version of the story misstated the timing of when StatMuse raised its $10 million Series A round. It was shortly after finishing Disney's accelerator program.