Capital Factory, a Texas company that supports, incubates and invests in startups, is establishing a D.C. outpost to help emerging companies develop working with the government.
The Austin company plans to open Station DC in 10,000 square feet above the Pastis DC restaurant on Fourth Street NE in Union Market. Capital Factory held a kick-off event Tuesday night.
The space, slated to open in 2025, will be converted into a tech hub incubator and meeting location for policymakers. It will also host networking events and educational programming.
Capital Factory Chief Operating Officer Meg Vrabel will oversee the buildout. In the coming weeks, Capital Factory will hire an executive director to manage the space, which could employ up to five people in the next year.
Its launch is yet another boon for D.C.'s startup community, which has had a series of ups and downs since homegrown AOL became a household name in the 1990s. Most recently, several outside-the-region venture capital firms have announced plans to open offices here to be near policymakers who will shape the next generation of tech.
Vrabel told me Capital Factory, which has close ties with the defense industry given the Austin-based and innovation-focused U.S. Army Futures Command, has "seen an explosion" of dual-use startups — those serving both consumer-orientated interests as well as government clients in the climate, defense, and health care spaces. She said many efforts fundraising for these startups starts with conversations taking place in Washington.
"We felt like we needed to be more proactive, get ahead of these huge funding decisions that are happening,” she said. “All of that's happening in D.C. This was our next natural step to support a growing part of our portfolio."
Buildout of the space, located in a building owned by Edens, is expected to take six months. To help facilitate site improvements, the D.C. Council approved a $2 million grant for Capital Factory for the purpose of "supporting a technology incubator in the District." Funds from the grant will be dispersed over the next two fiscal years.
Station DC will mark Capital Factory's first location outside of Texas. The for-profit, certified B corporation founded in 2009 by Joshua Baer, also has locations in Houston, Dallas and San Antonio. Those locations have co-working spaces, though the D.C. office isn't designed to offer such an amenity given its emphasis on meeting and learning.
The company also has a venture capital arm with $100 million raised and $70 million invested to date. It serves as an incubator and accelerator as well, with roughly 800 startups going through its program since it was founded.
In recent years, local firms Leidos Holdings Inc., General Dynamics Corp.'s GDIT division and Peraton Inc. have opened offices within Capital Factory's San Antonio location and SAIC Inc. established an outpost at its Austin location in 2019.
And Evan Burfield, who established the D.C. startup incubator 1776 and the startup software company Union, is a partner at Capital Factory.
"For me, as somebody who has certainly been a cheerleader for Washington, D.C., and startups for a long, long time, it's an incredibly exciting moment," Burfield told me. "When I looked around, there's nobody who does this work better in creating these tech hubs, in driving this kind of collaboration between government and startups than Capital Factory, and the work they've done in Austin and then Dallas and Houston and San Antonio is just amazing."
Burfield, Vrabel and others celebrated the arrival of Station DC following the “NATO to The Future: Preparing for Coming Disruptions" microsummit Capital Factory co-hosted in tandem with the NATO 75th anniversary summit in D.C. this week.
Washington Office, a government relations firm for emerging tech startups that launched on July 4, served as the microsummit's other co-host. The firm will maintain close ties with Capital Factory, offering pro-bono support to the organization's D.C. outpost. Its founding team includes Burfield; Baer, the Capital Factory founder; and Miles Taylor, a former government official serving in the George W. Bush and Donald Trump administrations.
