One of Chattanooga's best-known startups leaving Gig City for Silicon Valley

One of Chattanooga's best-known startups leaving Gig City for Silicon Valley

March 25th, 2016 by Mitra Malek in Business Around the Region
“"They grew to the point that they needed certain things that the city didn't have available to them. Their success is going to be forever tied to here."”
Mike Bradshaw, executive director of The Company Lab

Feetz

Feetz

Photo by David Andrews

Feetz founder Lucy Beard, right, with Feetz chief technology officer Nigel Beard.

Feetz founder Lucy Beard, right, with Feetz chief...

Photo by David Andrews

One of Chattanooga's best-known startups — arguably among its most successful — headed to California on Thursday, ready to close on another round of funding and claim a new location for its headquarters.

Recruitment challenges and investor demands put Feetz on its course to Silicon Valley, after nearly two years in the Scenic City.

"They grew to the point that they needed certain things that the city didn't have available to them," said Mike Bradshaw, executive director of The Company Lab, which played a key role in helping Feetz launch. "Their success is going to be forever tied to here."

The company's exact location in Silicon Valley is yet to be determined, Feetz founder Lucy Beard said.

One of Feetz's marquee funders, Khosla Ventures, which invested $1.25 million in the startup about a year ago, is based in the valley's Menlo Park. Beard declined to comment on how much her company, which raised more than $1.5 million in seed funding, expects to secure in coming weeks.

At least one investor or potential investor wanted Feetz to relocate to Silicon Valley, where the talent pool is deep, she said — and, perhaps more to the point, meaty employment prospects abound in general.

"I'm trying to poach people from high-growth startups. They'll say, 'OK, I really love what Feetz is doing,' " Beard said, of talking to candidates while the company was in Chattanooga. "But the number one question is: What happens if I want to move on from Feetz or Feetz doesn't make it?' "

By comparison, in a tech mecca like Silicon Valley, opportunities are plentiful.

"Talent and funding" are still local shortcomings, said Kristina Montague, a managing partner with Chattanooga-based JumpFund, one of Feetz's early-stage investors.

"How do we keep innovative businesses here?" Montague said. "It's something we continue to grapple with."

Feetz's departure has a sweet side though, she said. "As investors, it's great because they're growing."

Feetz, which custom builds shoes using additive manufacturing, or 3-D printing, landed in Chattanooga for Co.Lab's GigTank accelerator in summer 2014 and quickly became one of its standouts.

The company recently had its first production run of 100 pairs of shoes, costing $199 a pair. It offers two models for women, with designs for men expected this summer.

Co.Lab's Bradshaw in January 2014 started recruiting Beard, who was exploring Fab Lab, in San Diego. Beard and her husband and business partner, Nigel, have ties to San Diego and Silicon Valley. The Lamp Post Group's Tiffanie Robinson also convinced the duo to set up shop in Chattanooga, Beard said.

The community support was integral to Feetz flourishing, Beard said.

"We never would have done what we've done being anywhere else," she said.

For one, the pulsing competition of New York and Silicon Valley isn't characteristic of Chattanooga, she said.

"It's a lot harder to be vulnerable in places like that," Beard said. In Chattanooga, when you need help to get your fledgling business going many knowledgeable folks will offer a hand, she said.

Feetz had about 10 employees locally, three of whom are relocating. One will maintain the company's presence in Chattanooga.

Beard will be recruiting skilled workers in software, hardware, fashion and footwear.

"There's a combination of all that there," she said. "You have to look at: Where is that talent all coming together?"

Bradshaw said he's not disappointed Feetz is leaving town. Instead, he considers it a natural evolution and acknowledges that Chattanooga is new on the startup and venture-funding scene. Nor does he think the move marks an exodus of local startups.

"We're trending in the right direction," Bradshaw said. "If Feetz goes out into the world and is successful, it's only good for Chattanooga."

Contact Mitra Malek at mmalek@timesfreepress.com. Follow her on Twitter @MitraMalek.


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