Ni Yan, left, and Deborah Tien work on the finance tech crew called SISASA in the Gig Tank program Wednesday at the Co.Lab on East Main Street.

The GigTank is growing up.

The Co.Lab's summer business accelerator is kicking off its second year with shiny new furniture, a new approach and seven new teams of entrepreneurial hopefuls.

This summer's participants, who came to Chattanooga from as far away as Bulgaria, will spend three months hammering out business plans, creating prototypes, writing software and testing -- doing everything they can to create a viable business by the end of the summer.

Because when Aug. 6 rolls around, each team will pitch their company to a group of investors. And unlike last year -- when the winning team was guaranteed a $100,000 check -- this year there's no guarantee that anyone will walk away with a chunk of money.

Instead of handing out guaranteed prizes at the end of the summer, teams will be fighting for their share of a pool of money that area investors have set aside to give GigTank's businesses -- but only if they earn it.

A company could walk out with as much as a $100,000 investment or leave without a dime.

And that will make GigTank better, said Co.Lab Air Traffic Controller Sheldon Grizzle. The switch will encourage teams to work together while keeping the level of competition low, he hopes.

"Last year, we noticed that the level of collaboration dropped significantly as the summer progressed," he said. "And that was because they were getting more and more focused on their own projects, in the sense that, 'If I help another team that may decrease my chances of winning.' Whether that happened consciously or subconsciously, who knows -- but it happened. And we feel that goes against one of Chattanooga's core characteristics, collaboration."

The no-prize setup is just one of several changes GigTank organizers are making after the accelerator's inaugural year. The program, which is funded by private investors, is focused on ways businesses can capitalize on Chattanooga's ultra-high speed broadband.

EPB offers gigabit-per-second Internet speed throughout Chattanooga, the first city in America to gain citywide Gig speed. That's fast enough to download 26 mp3 songs every second.

Google also is installing Gig speed connections across Kansas City, Mo.; Austin, Texas; and Provo, Utah, and has brought its version of gigabit Internet speed to parts of Omaha, Neb. The early Gig cities hope to nurture pioneering businesses that can capitalize on the faster connections when they become more universally available.

But after the first round of businesses went through GigTank last summer in Chattanooga, they hit a snag.

"You can't build applications yet that are fully dependent upon gig speed because there are too many bottlenecks in the system," Grizzle said. "With the program this year it's not what do you do with the gig, it's more about the Internet of things."

That's not to say the GigTank's 2013 participants aren't tech-centered. The seven teams include four who are developing smartphone applications, ranging from an app that allows mobile grocery shopping to one that offers rewards for healthy living.

"This year it's not just about speed; it's about ubiquitous connectivity, and how that changes how we live and work and play," Grizzle said.

Banyan builds in Gig city

Most entrepreneurs fail.

"The important thing is to fail fast," said Toni Gemayel, CEO of Banyan, the business that won last year's GigTank. "Make your failures early on so you can correct them later."

It's been a year since he took home the prize, and so far, Banyan is still making progress. After a three-month stint in Tampa Bay, Fla., the company moved back to Chattanooga and now employs seven people.

They've raised $465,000 in capital and saw 30,000 people visit their website -- designed to facilitate research and collaboration -- in the first 48 hours after its public launch.

"GigTank was, on a personal level, the three best months of my professional career," Gemayel said. "It helped me get to the next level as far as identifying problems and solving them."

Creating companies like Banyan that can stand on their own is GigTank's end goal, said Mike Bradshaw, Co.Lab's entrepreneur-in-residence. And he thinks this year's participants have a head start on last year's teams.

"This year's teams are pretty advanced compared to last year," he said. "By the end of the summer I think a larger percentage will be ready to stand up real businesses."

That feet-on-the-ground mentality is also a switch from last year, Grizzle said.

"Last year's teams came in with ideas," he said. "It was a competition, and in competitions you get a lot of blue sky, wouldn't it be awesome if we could eventually do: fill in the blank. This year, five of the seven already have some sort of demonstration, prototype or product. And so just the progress that teams have made even before coming to the program is significant."

GigTank participants share space in the Co.Lab on Main Street for the duration of the accelerator. Most days, they work on pulling together the nitty-gritty of a business on personal laptops and smartphones. There's no set schedule -- they work as much or as little as they want. Some days, the teams meet with mentors or listen to lectures from successful entrepreneurs. They network and make connections, and at night many stay in UTC's dorms.

That day-to-day, pounding-it-out work is at the crux of the program. GigTank organizers don't want the accelerator to fall into the hype-trap.

"You're not doing anybody any favors if you artificially pump up a company that doesn't deserve it because there is some other agenda that you're serving," Bradshaw said.

And that's why the team is tweaking the program this year -- they're constantly trying to create the ideal environment to foster that real-business birth.

"It's no talk, it's no hype," Grizzle said. "Other people may hype it, but for us, we're trying to build real businesses."

Contact staff writer Shelly Bradbury at sbradbury@timesfreepress.com or 423-757-6525.