When we made the decision to start Mile Two just over a year ago there were so many questions that we had to answer. How are we going to get customers? Where should our office be? Are we going forward with a product or a service based business model? Can you do both? In an environment like Dayton, the answer is YES!
We decided early on that instead of taking outside investor money, we would bootstrap Mile Two by providing high quality custom software development for other companies and the Department of Defense (DoD). This approach provided us with an opportunity to build off our cumulative decades of experience working within the DoD without feeling the pressure of investors. It may not be as sexy a multimillion dollar venture capital backed startup, but it provided Mile Two with the opportunity to refine our business model and find our voice with a lower risk profile over the course of a year.
Is it possible to be both a “service provider” company AND pursue your own internal ideas for future products? Fortunately, in Dayton the answer is a resounding “Yes”. Before I left the Air Force to focus on Mile Two, I saw Barry Besecker, (the co-founder of Marxent), speak at the Dayton StartupGrind. Barry explained how Marxent earned money early on as a service based company and that the income from those projects allowed them to fund their own early R&D ideas in the Augmented Reality/Virtual Reality domains. As a result, Marxent recently secured a second round of significant VC investment which resulted in two startup companies in Dayton, Marxent and Magnetic Mobile. We have seen that model work in Dayton - so we know it is possible.
SpinTech and Tangible Solutions are other examples of entrepreneur teams that used several methods to reduce their risk early on before actually pursuing outside capital to scale, but only after they had proven their business models. Mile Two was built around the principle of working on innovative ideas with open-minded collaborators in an attempt to follow the lead of the success stories before us. We made certain to carve out time in our schedules to dedicate to high risk-high reward ideas that may attract and/or require a more typical VC model for success. True to our principles, we are already self-funding several internal R&D projects that with plenty of hard work and a little bit of luck may spin out as new companies in the near future. Stay Tuned!
Because we wanted Mile Two to have a diverse set of collaborators and customers, we chose to open our office in downtown Dayton. The Entrepreneur Center (TEC) provided a low risk and inexpensive environment for us to get started. When you are bootstrapping a company keeping costs low is one of the keys to survival and Dayton is one of the most affordable places to start a business. A downtown location provided Mile Two with the opportunity to interact with billion dollar organizations like CareSource and AFRL, innovation hubs like Ascend Innovations, and other startups like Desin, the inventors of Obi. That mix of risk takers, R&D investors, innovators, potential customers, and infrastructure provides the perfect mix to enable Mile Two (and hundreds of other companies) to continually identify fresh ideas, new opportunities, and cutting edge solutions.
We at Mile Two have been fortunate enough to outgrow two different offices at TEC and in doing so, have been so pleased with our experiences and opportunities downtown that we recently signed a long term lease to move out of The Entrepreneur Center and into our own permanent 5,000 sq/ft space in early 2017. Looking ahead to 2017 I see buzz of activity that is starting to grow into a roar. Who is going to be the next great Dayton success? I can’t wait to find out!