A Pittsburgh business accelerator that provided local startup ventures with strategic counseling over the last six years has closed, hoping to relaunch with a new mission and perhaps a new name.
The Social Innovation Accelerator (or, more simply, The Accelerator), which moved from the South Side to Downtown's Gateway Center last year, shut its doors July 1. The foundation's 10 paid employees -- half part time, half full time -- have all been let go.
The closure will be felt across the city, even among startups that weren't in The Accelerator's portfolio, says one client.
"It leaves somewhat of a void in the social innovation sector," said Andrew Butcher, head of Growth Through Energy and Community Health, a startup that plants sunflowers and other crops on blighted lots.
"It's unfortunate," he said, "given the increased profile of social innovation on a national level."
The day before The Accelerator closed, representatives from GTECH and dozens of other startups attended a White House session on nonprofits that find innovative solutions to community problems.
With more than $1 million in assets at one point, The Accelerator specialized in advising nonprofit social enterprise ventures, such as the Union Project's Youth Barista Program, the Westmoreland Museum of American Art's souvenir shop, as well as GTECH and others.
Its focus was helping nonprofits create new revenues, which in turn helps the nonprofits sustain themselves financially, enabling them to meet their social and environmental missions.
"Some of it worked, some of it hasn't," said Geoff Tolley, president of The Accelerator's board and CEO of GBL Inc., a Strip District marketing firm. "The next steps are talking to various not-for-profits [to] really identify the value of The Accelerator."
The Accelerator was created primarily with money from the McCune Foundation, a 30-year-old Pittsburgh philanthropy with issues of its own. Because McCune's assets were so heavily invested in National City stock, when the bank's stock value plummeted, so did McCune's investment portfolio.
As a result, McCune was forced to stop issuing new grants last year. And, as with most philanthropies, the last nine months have been unkind with regard to portfolio value.
Mr. Tolley said the recession and McCune's finances, while playing no direct role in the closure of The Accelerator, forced McCune and The Accelerator to examine whether they were spending their cash efficiently.
"We were never directed by McCune to do one thing or the other," he said. But, "I do think it's fair to say that [the recession] did cause us to look at the model." He said the board closed The Accelerator to allow it to settle on a new mission; the board viewed closure as a better option to keeping the doors open and adjusting the business model as they went along.
There is no timetable for reopening, nor is it known whether The Accelerator will even keep its name.
"How much equity is in the brand? Is it worth keeping? These are all open questions at this point," Mr. Tolley said.
In other words, the new Accelerator may not resemble the old one in many ways.
The Accelerator's Web site (www.acceleratenow.org) has been largely disabled, except for a message telling visitors that Olszak Management Consulting Inc., of East Brady, Clarion County, would be handling the post-closure process, fulfilling whatever contractual obligations remained.
Bill Toland can be reached at email@example.com or 412-263-2625.