1. Antecedent

Parallel18 is a top-level, performance-driven international startup program with a social mission: offering entrepreneurs from all over the world access to high-quality business training, grants, mentors, business contacts and investors to help them scale globally while working to position Puerto Rico as a unique hub for innovative businesses and technology.

The program is part of the Puerto Rico Science, Technology, and Research Trust, a private non-profit organization created with the goal of maximizing Puerto Rico’s participation and creation of jobs in the global knowledge economy by promoting investment and financing of science and technology research development. The organization manages and hosts over a dozen initiatives that range from grants and technical support to meetups and educational resources for researchers, entrepreneurs, farmers, investors, and other groups.

2. Main Goal

Our acceleration program welcomes companies from around the world to help them scale from Puerto Rico to global markets. Our team works hard to provide high-quality business education, develop business connections, and create investment opportunities for all our startups.

2.1. Specific Goals

  • Sustain the Program over a long period of time by remaining politically agnostic and showcasing the value that the program brings to the island.
  • Ensure buy-in from both the private sector and in all areas of the government by showcasing success and furthering economic development.
  • Encourage local and global angel, VC and private equity funds to invest in the best and brightest startups emerging from the island.
  • Help fix some of the challenges that the Puerto Rican economy is currently faced with.
  • Develop a creative and innovative vibe within the community that moves beyond technology and touches the arts, culture, culinary, tourism and other interests.
  • Encourage Parallel18 corporate partners to engage in business development with startups to explore new opportunities for corporate innovation.
  • Further the growth of the local economy.
  • Position Puerto Rico on the map as an active member in the global startup ecosystem and as a center for innovation and entrepreneurship.

3. Expected Results

  • Companies with high global potential developed and scaling from Puerto Rico.
  • Partner directly with local organizations to help integrate the program and its participants into the local business and startup ecosystem.
  • Increase the retention efforts of local university students by presenting them with opportunities to intern and work for the new companies created through the program.
  • Increase the repatriation efforts of the Puerto Rican diaspora by promoting opportunities for employment with the new companies created through the program.
  • Create positive global visibility by positioning Puerto Rico in the global media as a new innovation hub.
  • Work towards inclusion in global innovation indexes.

4. Participants

Startups that apply must be incorporated in Puerto Rico or in the United States with authorization to do business in Puerto Rico. In the case that your company is not incorporated in any of these locations, the Program will provide you with resources that can assist in this process. Only founders that own fifty percent (50%) or more of their startup may apply. The founder applying to the Program must be over eighteen (18) years of age, and the Program participants may not be more than three (3) people. Parallel18 reserves the right to use its discretionary faculty to accept team members below the age of eighteen (18) as extraordinary situations may arise.

4.1. Entity (only one)

The entity is the legal company duly specified in the application form behind the startup applying to the Program. The entity needs to be incorporated in Puerto Rico or in the United States with authorization to do business in Puerto Rico as a Corp. or LLC company. In the case that the company does not have this legal structure, Parallel18 will provide you with resources that can assist you in this process.

4.2. Team Leader (only one)

The team leader, also known as the beneficiary, is a natural person, duly specified during the application form, that is an original founder of the startup and continues to be a C-level member directly involved in the company’s business strategy, commercial activities and decision making. The person designated as the team leader must participate in the program in Puerto Rico during the entire period of the program, and be exclusively dedicated to the development of this project. If not a U.S. citizen, the team leader must have the ability to apply for a visa to enter the U.S.

4.3. Team Member (max two)

Optionally, the participation of up to two additional natural persons who form part of the founding team and continue to be C-level business oriented decision makers for the company may be considered. If the team members that plan to participate in person in Parallel18 are not U.S. citizens, they must have the ability to apply for a visa to enter the U.S. The visa application process should be started as soon as you submit your application to the program to prevent delays in your arrival to Puerto Rico.

5. Activities Eligible for the Program

Those activities that enable the launch and scaling of companies with high global growth potential that use Puerto Rico as a platform to grow. Projects may not consist of consulting services, non-profit organizations, traditional import/export companies, or lifestyle businesses. Projects must be at least in a stage where the concept was validated, with a functional product, some initial commercial traction, with the company prepared to scale operations, and a full time team dedicated exclusively to the company, understanding these to be projects with less than three years.

6. Program Activities

The Program will include a variety of activities and/or events, which will be made available to participants of each project, with a distinction made between mandatory and optional activities.

6.1. Mandatory Activities

During participation in the 5-month Program, the beneficiary must participate in the following mandatory activities:

A. Soft Landing Week

Mandatory for the team leader only (all approved team members are welcome to participate). Activities include:

  • Program welcome orientation days
  • Peer presentation by the company to the incoming cohort
  • Finalizing the execution of the program Grant Agreement
  • Setting up company with local service providers as needed
  • Initial assessment meeting: explanation of Program rules and establishment of clear milestones and KPIs

B. Weekly Follow Up (KPI) Meeting

You will be required to meet with the Program staff to analyze weekly progress and strategic plans, in order to facilitate the accomplishment of goals by providing access to the right resources.

C. Midpoint Evaluation

Presentation of the update and progress of the company to Program, who will analyze in detail the progress of the company during the first 2.5 months. If the company does not meet Program’s standards of acceleration, the Program is entitled to put an early end to the project.

D. Investment Immersion

A week for engaging with invited investors, having investment evaluation 1:1 meetings, learning best practices about raising capital, and negotiating investment terms, among other fundraising activities.

E. Demo Day

Key public event to showcase accomplishments in the Program to local and foreign investors as well as the local business community. Participation is pending approval from Program after successfully complying with Program requirements and proven growth of traction during the Program.

F. Other Activities

Within the Program that are designated as mandatory, such as P18Connect pitch practices before presenting to corporate partners.

6.2. Optional Activities

  • Presentations, office hours, workshops, classes or other events organized by other program participants.
  • Other activities related to the project and/or program that were not described as mandatory.

7. Contents of the Project

7.1. Required (in English)

  • Background documentation for each team member (nationality, education, technical experience and work history)
  • Legal entity documentation
  • Identification documentation for selected companies and members
  • Description of dedication (time and resources) to the project
  • Description of leadership history of the beneficiary
  • The product and/or service to develop and/or commercialize
  • Description of the competition and the project’s differentiation
  • Stage or phase of the project at the moment of application
  • Explanation of why Puerto Rico would help accomplish your milestones
  • Readiness to have presence in Puerto Rico and expand into a new market
  • Short video explaining company, level of commercial traction, and reason for applying to Parallel18

7.2. Optional

  • Motivation to develop the project from Puerto Rico
  • Participation in organizations related to entrepreneurship and innovation
  • Relationship with international networks
  • Commercialization and scalability strategy
  • Entry and exit barriers
  • Progress to date and plan during participants’ stay in Puerto Rico
  • Target market and its size
  • Market position
  • Letters of recommendation

Note: Incomplete applications and applications not written in English will be deemed not submitted.

8. Deadlines

The Program duration is 20 weeks and will be understood to have begun on the date established by Parallel18 as orientation day. This date will be notified once the companies are selected.

9. The Funds

The Puerto Rico Science Technology and Research Trust will provide a grant of forty thousand dollars (USD $40,000) delivered in various sets throughout the program, subject to the participant’s compliance with the terms and conditions set forth herein. All disbursed and used funds need to be properly declared by showing corporate bank statements, and in certain cases an invoice of the service or product acquired.

10. Application

10.1. Procedure

This program will be made available to interested parties in the form of an application. Communication about the opening of a call for applications will be conducted by means of a notice published in the program’s website and social media platforms.

10.2. Means of Application

Companies may apply solely through the YouNoodle application, accessible on the Parallel18 website (www.parallel18.com) or YouNoodle’s website. Accompanying documents must be text documents, spreadsheets or other compatible files (doc, xls, jpg, pdf).

10.3. Limit of Applications

Each applicant may only apply once with one project per application period. If a team member is part of various applications for different projects, Program may consider the Project and/or applicant invalid.

11. Evaluation Process and Criteria

There will be 3 phases of the evaluation process: Screening Round, Judging Round, Interviews (if needed), and Final Selection.

11.1. Screening Round

The Program staff will initially review all applications to determine if they comply with the basic requirements. Those that pass will advance to the Judging Round.

11.2. Judging Round

Program will facilitate a panel of international experts to evaluate applications on a score of 1 to 5 across the following criteria:

  • Product or Service (20%)
  • Traction (20%)
  • Market and Competitive Positioning (20%)
  • Team Mix, Qualification & Experience (20%)
  • Engagement with Puerto Rico (20%)

11.3. Product or Service (20%)

  • How differentiated and innovative is their product or service?
  • Is the business opportunity unique and innovative? Is it tackling a real need?
  • What is their competitive advantage?
  • Is the product and technology presented feasible?

11.4. Traction (20%)

  • Has this startup built and tested an MVP? Is the product already working?
  • Do they demonstrate some initial commercial traction in their market?
  • Do they have an initial user base and understanding of their target market?
  • Does the team have the ability to undertake tangible business activities related to expanding into a new market?

11.5. Market and Competitive Positioning (20%)

  • Is this startup’s market share likely to be large? Can this venture achieve a leadership position?
  • Does the team have a clear understanding of who their ideal customers are?
  • Does this team understand who the present and future competitors are?
  • Has the team articulated a clear competitive advantage?

11.6. Team Mix, Qualification & Experience (20%)

  • Does the team demonstrate dedication, focus and resilience?
  • Do they have valuable and transferable skills?
  • How coherent is the team? Do they demonstrate complementary skill sets?
  • Is this the right team for this project?

11.7. Engagement with Puerto Rico (20%)

  • Does the team demonstrate a genuine interest in becoming part of an active Puerto Rican entrepreneurship community?
  • Will this team clearly benefit from and contribute to the Puerto Rican economy?
  • Has the team identified a specific strategy to take advantage of the opportunities Puerto Rico has to offer?
  • Will this team be an active and valuable member of the Puerto Rican startup ecosystem?

11.8. Interview Round

During the evaluation period, an interview through videoconference, or in person if feasible, may be requested to clarify questions from the evaluators.

11.9. Final Selection

A local selection committee composed of experienced members will make the decision to select up to 40 final companies for the Program.

12. Decision

Once the evaluation is concluded, the program will have 7 business days to inform the applicants about the final decision and extend an offer to join the Program.

13. Company Acceptance

Upon the company’s acceptance of the offer to join Program, the process of soft landing begins. This acceptance must be completed within 3 business days after the Project is informed of acceptance.

14. Option to Invest

By accepting participation in the Program, the Company hereby grants the Program an irrevocable option to invest in the Company. The option shall be exercisable upon each of the Company’s subsequent fundraising rounds at the discretion of the Program, based on Program’s availability of funds to invest and interest in investing in the Company.

15. Delivery of Grant

15.1. Mode of Delivery

After the execution of the contract, the total amount of the funds will be delivered in various sets throughout the program, the first set being $20,000 at the beginning of the program. The grant can only be deposited in a Puerto Rico based corporate bank account. The company can spend up to $5,000 in indirect costs and up to $5,000 in housing expenses.

15.2. Conditions for Delivery

  • Sign the Parallel18 Grant Agreement in a satisfactory manner
  • Delivery of original documentation declaring participants’ legal status
  • Successfully comply with the required criteria for the midpoint evaluation
  • Maintain good standing status throughout the program duration

15.3. Suspension of Payments

Continuity in the delivery of funds shall be subject to the evaluation made by Parallel18 of the project’s progress and to budgetary availability of funds. Parallel18 may suspend payments temporarily or permanently if it finds that the project is not being carried out in a satisfactory manner or that the beneficiary has failed to fulfill their obligations.

15.4. Accounts and Expenses Eligible for Financing

  • Human Resources: Salaries or fees of technical and/or professional personnel directly associated with project activities who are legally authorized to work in the United States.
  • Operating Expenses: Direct spending associated with project execution, such as administrative support, office lease, travel, medical insurance, product development, client visits, and visa processing.
  • Capital Expenses: Purchase of durable goods necessary for the strategic implementation of the project, after written notice and approval from Program.

15.5. Expenses Not Eligible for Financing

  • Salaries for personnel not legally authorized to work in the United States
  • Investments in capital markets
  • Recoverable taxes
  • Acquisition of properties not related to the project
  • Airfare for persons not directly involved in the project
  • Alcohol purchases
  • Leisure expenses
  • Any other expenses not directly related to the project

15.6. Account Reporting

Expenditures charged to Parallel18’s grant must be reported based on actual costs, at the price actually paid, duly supported with reliable documents that verify the amount in USD at the time of the expense.

15.7. Prepaid Expenses

Expenses incurred from the date of communication of the approval decision may be accepted at the risk of the beneficiary. The lack of formalization of the Grant Agreement will not result in either compensation or reimbursement.

15.8. Monitoring and Reporting

Parallel18 holds the authority to track the activities of the beneficiary and third parties hired, without prior notice. The beneficiary must comply with the calendar of monitoring meetings and deliver reports in accordance with Program requirements. A final use of funds report must be delivered within 2 weeks after the expiration date of the term for project execution.

16. Early Termination

16.1. Early Termination Not Attributable to the Beneficiary

Parallel18 may impose an early end to the project in cases such as failure to achieve critical results for reasons not attributable to the lack of diligence of the beneficiary, or having become convinced that the project will not achieve the expected results for reasons outside the beneficiary’s control.

16.2. Early Termination Attributable to the Beneficiary

Parallel18 may put an early end to the project if the beneficiary fails to comply with their obligations. Situations that may constitute breach of contract include:

  • Denial or hindrance of project monitoring
  • Negligence in performing financial and technical control activities
  • Significant undisclosed changes in the business model and/or founding team
  • Serious discrepancy between declared and real technical and/or legal information
  • Non-compliance with critical results or continuity milestones
  • Duplication, simulation, or falsification of financial documentation
  • Failure to maintain good standing status throughout the program

In this case, the recipient must repay the entire grant received within 15 days of the notice of early termination.

17. Warranties

The participants warrant and represent to Parallel18 that they shall not violate any intellectual property rights, confidentiality, right of privacy or other right of any person or entity. Participants also represent that all information provided during the application and contracting phases is accurate and complete.

18. Legal Status

The participants shall be considered as having the legal status of an independent partner vis-à-vis Parallel18. Nothing contained herein shall be construed as establishing an employer/employee relationship with Parallel18. Parallel18 shall not be responsible for any loss, accident, damage or injury suffered by the participants arising during or as a result of the grant.

19. No Waiver

The waiver by either Parallel18 or any participant of any provision or breach of these terms and conditions shall not prevent subsequent enforcement of such provision or excuse further breaches.

20. Liability

The participants hereby indemnify and hold the Puerto Rico Science Technology and Research Trust harmless from and against the full amount of any and all claims and liabilities, including legal fees and costs, arising out of breach by the participants of any of its representations or warranties.

21. Assignment

The participants shall not assign, transfer, pledge or make any other disposition of the Contract or any part thereof, or any of their rights, claims or obligations under the Contract except with the prior written consent of Parallel18.

22. Questions or Consultations

Questions may be addressed in English or Spanish to: [email protected]