Bentonville-based Cartwheel Startup Studio and the University of Arkansas Office of Entrepreneurship and Innovation (OEI) recently kicked off an accelerator to support 10 technology startups in the retail value chain.
The Bounds Accelerator started virtually and hosted an in-person reception with events in Bentonville earlier this month. The 16-week accelerator will conclude with a demo day event on April 29 at Ledger in Bentonville. The public event will have the startups competing for cash.
The accelerator largely takes place virtually and brings together entrepreneurs, industry and technology leaders, college students and startup founders who are working to develop technology for the retail, transportation, logistics, manufacturing and supply chain sectors.
Three of the 10 startups are based in Northwest Arkansas, including Hashku, Indexer and Mycelium Networks. The others are from California, Georgia, Michigan, Missouri, Nevada, New York and South Carolina.
Josh Stanley, co-founder and CEO of Cartwheel Startup Studio, said the 10 startups have raised more than $18 million cumulatively, and some are still raising money. They all range from the seed-to-series-A stage and are tech companies leveraging artificial intelligence (AI), blockchain, or augmented or virtual reality.
The accelerator is supported by $297,000 in grants, including the Arkansas Economic Development Commission Business and Technology Accelerator Grant and a $50,000 sponsorship from Coinbase Ventures. Huan Ventures and the AI Foundation are also supporters.
“We’re [Cartwheel] the lead in terms of forming the programming and curriculum, in partnership with the University of Arkansas,” Stanley said. “We brought in some pretty fantastic partners, Coinbase Ventures and Huan Ventures, both participating, providing content, and networking and supporting the cohort participants.”
Stanley said the accelerator’s goal is to attract startups in the retail value chain to the area.
“The more startups we have in this region that are tied to the retail value chain, we also see the value-add of when you do that you allow for more companies to have value back and forth,” he said. Stanley added that 90% of startups fail, and if the area has a large startup concentration in this space, people have other employers from which to choose. Also, venture capital firms are more likely to invest in areas with larger startup concentrations in one space.
MORE THAN A STUDIO
Stanley said Cartwheel was established in 2021 as a startup studio and has launched three companies. It’s focused on launching business-to-business, software-as-a-service companies. Cartwheel plans to launch up to four companies each year through its studio.
He said since last year, Cartwheel’s looked to expand beyond its startup studio.
“A startup studio is an incubator and an accelerator all in one,” Stanley explained. “The skills and activities associated with running an incubator or accelerator are very similar. We looked at the whole space and said, ‘We should be involved in all venture-building activities or new venture development activities.’ That was at the core of it.”
The OEI partnership was another aspect of launching an accelerator and on Cartwheel’s to-do list, he noted. The accelerator has been in the works since April.
“We’ve partnered on other initiatives in the past, and this is one that felt like a great chance to truly partner on a building of a program level,” Stanley said. “This is a region that is primed to launch new ventures in the retail value chain space. We haven’t done a lot … with this amalgamation of numerous industries like manufacturing, retail, supply chain, etc. All of those together … equal the retail value chain. And we feel like this region, if it has a right to win or an unfair advantage when it comes to new venture development, it is in the retail value chain. We have … Tyson [Foods], J.B. Hunt [Transport Services], Walmart, etc., plus over 1,400 suppliers that also play in that space.”
Stanley looks to host the accelerator again next year. Cartwheel has seven staff.
Zoe Buonaiuto, associate director of business incubation at OEI, said the Bounds Accelerator was an opportunity to launch one of the three pillars of innovation in which OEI is interested — emerging technologies and the future of the internet, or Web3. The other pillars are focused on outdoor recreation and healthcare.
“It became pretty evident that there was a great opportunity to stand up an accelerator that was targeted on emerging technologies, given the influence that a lot of political leaders have in that arena, speaking notably here about [U.S. Rep.] French Hill [R-Little Rock],” she said. “If you … marry that idea that we’re well positioned to do something with emerging tech layered on top of retail, given our position as sort of the capital of retail, we could do an accelerator unlike anyone else could.”
Buonaiuto said the UA has ties with a lot of entrepreneurial support organizations in Arkansas, including Cartwheel. The UA also has a lot of mentors in its network to support the accelerator. And, the UA has the existing Venture Intern Program that will provide paid interns for each startup.
The UA is providing the “academic expertise” for the accelerator, she said. One workshop will focus on the regulation of crypto assets. It will be led by UA law professor Carol Goforth, who’s a leader on this issue. Another workshop will be on AI ethics. It will be led by Cindy Moehring, founder and director of the Business Integrity Leadership Initiative at the Sam M. Walton College of Business.
HELPING BRANDS CONNECT
Bentonville-based startup Hashku is a cohort member in the Bounds Accelerator. Hashku is helping brands connect with younger generations through gaming.
Joel Ponce, co-founder and CEO of Hashku, said the company created digital items for The Hershey Co. before Halloween. The Hershey’s items included costumes and other Halloween-related merchandise that Roblox gamers can buy for their characters to wear in the online game. The items are currently available on Roblox.
“We truly view gaming as a next-generation channel to drive commerce,” Ponce said. He added that Store No. 8, the incubation arm of Walmart, has developed a platform, “in partnership with Unity, to allow people to drive commerce for items on Walmart.com within game experiences without having people click out of the game experience.”
Through the accelerator, Ponce hopes to have the opportunity to connect with Walmart staff and drive commerce on Walmart.com.
Ponce moved to Northwest Arkansas in 2013 and has advertising experience, including at Saatchi & Saatchi. Before joining Hashku full-time in February 2023, he worked at Paramount for about five years, helping brands develop custom content and experiences. Hashku has two staff and adds contract workers as needed.