Over the last three weeks I’ve had numerous people ask me how my trip to Boston has been going. For a while I corrected them and said “I’m mostly in Cambridge” but gave up. Tonight, after hanging out at the TechStars Boston Mentor evening and program kickoff, I got into a long discussion with a Bill Warner and Ken Zolot about Cambridge, Boston, and startup communities. At some point in the conversation I blurted out “I have no idea why we call this program TechStars Boston instead of TechStars Cambridge.” And then something that I thought was important dawned on me.

My entire entrepreneurial view of “Boston” is centered around Cambridge. I’ve been here for two of the last three weeks (I spent four days in New York). I’m staying in a hotel in Kendall Square across from Google and next to MIT. I’ve spent my days walking to meetings at MIT, Kendall Square, Tech Square, Central Square, and East Cambridge including what I refer to as “the old Lotus building”. I’ve had all of my meals in Kendall Square or Central Square. Other than running, I’ve only been physically in Boston four times – first when I arrived at the airport, then when I took the train to New York, then when I returned on the train from New York, and finally when I spent the morning at Fidelity’s FCAT offices at Summer Street.

Now, I know there is plenty of startup activity in Boston. My old neighborhood near Fort Point Channel (I used to live on Sleeper Street in a condo at Dockside Place) is bustling with startup activity. There’s plenty of stuff on 128 and 495. There’s are other entrepreneurs tucked around the city. But that’s not the interesting story, at least in my mind.

The few square miles in Cambridge around MIT is the white hot center of startup activity in the region. One of my basic principles of startup communities is the need for what I call entrepreneurial population density (EPD) which I calculate as the total number of entrepreneurs and employees of entrepreneurial companies divided by the total number of all employees in a region. Then an even more powerful metric is entrepreneurial density, which is EPD / size of region. A large EPD in a small physical region wins.

Part of the magic of Boulder is the entrepreneurial density of the place. And as I wander from meeting to meeting in Cambridge, running into people on the street who I know, or who I met with the day before, or I who I want to know, reminds me of the dynamic in Boulder. For example, I ran into Matt Cutler on my way to Rich Levandov’s office and we walked over together. I bumped into the StartLabs organizers when going to a meeting with Will Crawford. I saw Joe Chung while hanging around StartLabs. I saw 50+ mentors who I knew last night at TechStars and expect to see more today when I’m there. While having breakfast with Michael Schrage at the Cambridge Marriott Joost Bonsen came over and said hello. At Dogpatch meeting with Yesware I saw Dave Greenstein and gave him a hug for his new kid. And the list of moments like this, which happened with 10 square blocks, go on and on. But when I hop on the red line and travel to South Station, the magic disperses.

I remember when the Boston VC community moved from downtown Boston to Waltham. I understood it was an effort to create a “Sand Hill Road” like venture community but the big miss was that an MIT student couldn’t hop on a bike and ride to Waltham like a Stanford student could with Sand Hill Road. And it’s no surprise that downtown Palo Alto, which is even closer to Stanford, is an attractive place for VCs to hang out. The snarky message when the VCs moved to Waltham was that they wanted to be close to their fancy houses and their private golf clubs and the entrepreneurs could come to them. It’s no surprise that many of these firms have relocated to Cambridge, recognizing that they should be in the middle of the entrepreneurial energy.

I’d suggest to the Cambridge and Boston startup communities that they should think of themselves as two separate but related communities. Even within Boston, it seems like there are different startup communities in downtown, 125, and even 495. I think that thinking of it “Boston” is a mistake.

In my world view, the entrepreneurs drive the startup community. Focus on entrepreneurial population density and entrepreneurial density – and make sure your geographic region is small. Over time, linking the critical mass together in a larger region (e.g. Silicon Valley or Boston) is fine, but the real power comes from the startup communities with the largest EPD in small physical regions which are big enough to have critical mass.

As someone obsessed with human computer interaction, the Kinect is an important piece of hardware. Of all the various things Microsoft is working on these days, I find it the most interesting. I’ve seen some awesome things done with it by my friends at Oblong and Organic Motion and saw a ton of neat hacks at last year’s Blur Conference.

Recently, Microsoft announced the Kinect Accelerator, a program created to incubate startups building the next generation of innovative experiences for the Kinect. Microsoft’s Kinect Accelerator is powered by TechStars and applications for the Kinect Accelerator are now being accepted through January 25, 2012. If accepted, each company will receive an equity investment of $20,000 in exchange for six percent of the company in common stock, which will be held by TechStars. While Microsoft is putting significant effort into the accelerator program, Microsoft will not retain intellectual property or equity in any of the participating companies.

From March to June 2012, the companies will co-locate in space provided by Microsoft in Seattle where they will be provisioned Xbox development kits, Kinect hardware, the Kinect for Windows SDK and space for testing and developing Kinect based applications. Microsoft BizSpark will also supply each of the companies with a full complement of Microsoft development tools and support.

The companies will interact with and have access to mentors during the course of the program including Microsoft executives, entrepreneurs, and investors. The goal is to help new startups develop both the technology around their Kinect experience as well as the business model so the resulting company can prosper as an independent entity after the program.

Some of the mentors, in addition to me, include:

• Jeff Powers, Founder, Occipital,
• Andrew Tschesnok, Founder, Organic Motion
• Manu Kumar, Investor, K-9 Ventures
• Eran Egozy, Founder and CTO Harmonix
• David Cohen, Founder/CEO, TechStars
• Eric Norlin, Organizer, Blur, Defrag, and Glue conferences
• Jason Mendelson, Managing Director, Foundry Group

Some of the Microsoft mentors include:

• Dan’l Lewin, Corporate VP, Strategic and Emerging Business Development
• Craig Eisler, General Manager, Kinect for Windows
• Phil Spencer, VP, Microsoft Games Studios
• Anoop Gupta, Distinguished Scientist, Microsoft Research
• Michael Mott, General Manager, Microsoft Games Studios
• Rick Martinez, Executive Producer, Microsoft Studios
• Dave Drach, Managing Director, Emerging Business Team
• Adam Isgreen, Creative Director, Microsoft Studios
• Jeff Matsushita, Executive Producer, Microsoft Studios,
• Rhys Dekle, Director, Business Development, Microsoft Studios

David Malcolm, a former Microsoft executive and current TechStars mentor, will be the Managing Director of the Kinect Accelerator. Since the program is powered by TechStars, it’ll follow the standard TechStars timeline finishing up with a demo day at the end of the program.

If you are an entrepreneur working on something related to Kinect, I can’t imagine a better place to spend three months of your life accelerating your business. Apply now.

PBS Newshour has a neat eight minute segment on accelerators. TechStars is featured, along with several others. This makes me happy as part of our goal when we started TechStars was to “open-source” the mentor driven accelerator process. It’s been awesome to be part of this incredible (and – in my opinion – incredibly important phenomenon).

The punch line from the interview is in the first 30 seconds.

“The Kauffman Foundation, which studies entrepreneurship, recently found that startups create about 3 million new jobs a year.”

I really wish every member of Congress would read this over and over and over again. Whenever I see stuff like Protect IP and SOPA making progress through Congress (both bills – which if passed – will have a chilling effect on entrepreneurship and job creation) I get frustrated. It’s easy (but incorrect and uniformed) for people in Washington to dismiss accelerators, and entrepreneurship, as a small part of our economy. But when there’s as much focus as there is on creating jobs, it seems like our friends in Washington should be turning everything else upside down to be supportive of activities that create jobs, especially when the job creators (e.g. entrepreneurial companies) aren’t asking them for anything. And remember that these are only direct jobs – think of all the indirect jobs that get created by the payrolls, wealth, and taxes generated by these entrepreneurs.

If you don’t understand what an accelerator is, or just want a nice eight minute overview, watch this video. And repeat to yourself “startups create about 3 million new jobs a year.”

Near the end, Vivek Wadhwa makes the comment that “other countries like India and China are learning our secret sauce. They are learning what made America what it is.” I’d add Europe to that – following is a picture of me talking to a group of entrepreneurs in Copenhagen this moving via Skype as part of Startup Bootcamp, a TechStars Network partner with accelerator programs in Copenhagen, Dublin, and Madrid. This is a worldwide phenomenon – and it’s awesome.

If you want to go to TechStars for a Day in Boston, today is the last day to apply for the Boston program early application deadline. If you haven’t heard of TechStars for a Day, it’s a one day event that immerses you in the TechStars program, exposes you to the mentors, and increases your visibility with the selection committee. Why wouldn’t you do this? I have no clue.

If you are contemplating applying to Techstars Boston, stop procrastinating and apply now. If you are curious about how some of the TechStars Boston class of 2011 have done, take a look at the post titled 2011 Funding: Boston. And yes, I plan to be in Boston for the second half of January so I’ll be at the first few days of the program for everyone who gets in.

I’m about to head out to TechStars New York Demo Day. Our investment in SideTour – one of the TechStars New York companies – was announced yesterday and I’m excited to introduce them along with hanging out with all of the other great entrepreneurs from this session. If you’ve been watching the Bloomberg TechStars series, we are doing the finale tonight where we meet with all of the teams and see where they are six months after the program ended. It’ll be happening live at 9pm ET/PT.

Since I haven’t yet figured out how to be in two places at the same time, I ended up recording a short video for a meeting on entrepreneurial communities that I was invited to. In it, I talk about my first of four principles of entrepreneurial communities, specifically that entrepreneurial communities must be led by entrepreneurs.

Following is the video along with my notes.

Four key principles of entrepreneurial communities
- led by entrepreneurs
- 20 year view from today
- engage the entire entrepreneurial stack
- continually get fresh blood into the system

briefly focus on the first – entrepreneurial communities have to be led by entrepreneurs

entrepreneurial communities have leaders and feeders

feeders include everyone that does things that are inputs into the entrepreneurial community
- lawyers
- accountants
- angel investors
- venture capitalists
- government

leaders are the entrepreneurs
- you don’t need a lot to make a huge difference
- a half a dozen is a great starting point
- but they have to commit for 20 years from today

all of the feeders have a role
- some feeders try to be leaders – this never works
- rhythm is wrong: 20 years vs. 4 of government
- personality is wrong: lead vs. support
- incentives are wrong: job vs. creative act

if the leadership of an entrepreneurial community is co-opted by local government
- there might be short term activity
- but it will fail over the long term to become sustainable

remember: the entrepreneurs need to be leaders

if you are a feeder:
- identify them
- encourage them
- support them

but let the entrepreneurs be the leaders

Are you building a cloud startup? If so, apply to TechStars Cloud today!

Earlier this month TechStars announced its newest accelerator program, TechStars Cloud, and we are looking for the best cloud startups we can find to go through the inaugural program.

We’ve gotten a lot of questions about what constitutes a “cloud startup”, so here is a discussion of what we think are cloud startups. We think we can do something special with this program and have big expectations for the results we’ll see when we connect early stage cloud startups to the best cloud mentors and companies.

If you haven’t heard, we have upped the initial funding in the program to 118k.

Apply now as the deadline is October 21.

The official TechStars Store is up. Shirts, hats, hoodies, and stickers. And of course the books Do More Faster and Venture Deals. What – no sweatbands? Cohen – we need sweatbands. C’mon man.

Don’t forget to check out the new TechStars website while you are at it. And apply for one of the upcoming programs, including the brand new TechStars Cloud program

Today, TechStars announced that they’ve raised $24 million from a broad syndicate of investors to fund an additional $100,000 for every TechStars company going forward. The investors include Foundry Group, IA Ventures, Avalon Ventures, DFJ Mercury, SoftBank Capital, SVB Financial Group, RRE Ventures, Right Side Capital Management and TechStars alumni.

There are lots of good articles on the news – two of them are at TechCrunch (Startup Incubator TechStars Raises $24M, Increases Funding For Each Company By $100K) and Launch (TechStars Offering Extra $100K to All Companies with New $24M Fund.)

One of the principles of TechStars has been to be as inclusive as possible for the VC and angel investors in the communities in which we run programs. To date, there are over 75 VCs and angels that are funding TechStars programs in Boulder, Boston, Seattle, and New York. There are many more who have invested in individual TechStars companies.

With the launch of the new TechStars Cloud program, there are now over 60 new companies a year going through TechStars and getting launched. At $100k / company, TechStars has raised enough to fund each company with the incremental $100k for the next three to four years (that’s a hint that there will be more programs coming.)

When I think about all the amazing investors – and the hundreds of mentors - involved in TechStars, I’m deeply humbled to be a part of it.

Before we invested in MakerBot, we bought and assembled a Thing-O-Matic. When I say we, I mean me, Jason, and Ross. It took us about 20 hours (Jason and I did the first half; Jason and Ross did the second half) and was a blast – think of it as an adult lego project. Our Thing-O-Matic has been steadily printing stuff – you can play a game of chess with our Thing-O-Matic pieces. the next time you are in my office.

As part of the endless series of Amazing Deals I bring you from my deal site, today’s offer is a fully assembled Thing-O-Matic. If you want your own 3D printer, but you don’t want to assemble it, you can buy it fully assembled for $2,500. But, through the magic of daily deals, there are 20 available for a 20% discount ($2,000). This is a one time offer from my friends at MakerBot so grab ‘em while they are available.

In additional TechStars Cloud launched today along with the first episode of TechStars on Bloomberg TV.

And finally, for all of you that have written asking for a “Convertible Debt Series” like our term sheet series, we’ve just started one on AsktheVC.com. The first post is up and introduces the series – we’ll be working through all of the terms in a convertible debt deal over the next few weeks.

On This Week In TechStars #6, David Cohen interviews Jason Mendelson on the making of our hard hitting documentary on VCs music video “I’m A VC.” The interview happens in Jason’s basement music studio where much of I’m A VC was written, composed, sung, recorded, and – well – whatever you do in a music studio.

If you haven’t yet watched I’m A VC, what are you waiting for? And, if you have a connection to Stephen Colbert or Jon Stewart, give me a shout as we’d love to help them educate the world about venture capitalists, along with helping promote our book “Venture Deals: Be Smarter Than Your Lawyer and Venture Capitalist.” Mendelson on the Colbert Report – doesn’t that sound cool?