Montreal-based incubator Execution Labs
(XL), which provides independent teams with workspace and funding to help bring their titles to market, is bringing its venture capital partners directly to its upcoming graduates through a new convertible note program, designed to help recently accelerated indie teams survive the first months toward profitability.
The investment firm, BDC Venture Capital, led Execution Labs' seed funding when the company first launched in November of last year. This new partnership brings "select companies" coming out of Execution Labs' six month acceleration program with $150,000 CAN convertible notes, structured as a loan at the time of investment.
The arrangement, according to Execution Labs, is "meant to help new studios weather a period that can be very rough for them financially, as they continue working to generate revenues and to position themselves to successfully raise subsequent financing from other investors."
Other accelerators such as Tech Stars and FounderFuel have offered similar interim financing options for startups, but this marks the first geared specifically toward independent game developers. It comes in addition to the funding already provided by Execution Labs for incubated projects, which includes a $2,000 CAN stipend per month per team member and six months of provided workspace.
"The capital we provide during the course of the program is really designed to fund the teams' game development and initial go-to-market efforts," co-founder Jason Della Rocca explained, in conjunction with the announcement. "The BDC Venture Capital convertible note program now gives our graduating studios time to continue running their games as a service and ramp up their revenues after they leave XL."
"Having a note in place from a reputable investor like BDC Venture capital makes it easier for [accelerator graduates] to attract additional financing to expand their studios and release more games," Della Rocca continued.
Execution Labs expects to start accepting applications for its second cohort of development this fall. You can learn more about the program here