Will Backing and Mentoring from Excelerate Labs Add Up to Seed Round for MathZee?

Months-old MathZee, a Chicago-based mobile and Web platform that’s developing math games for children ages 3 through 7, plans to raise $500,000 in seed funding “likely at year end,” company co-founder Namit Yadav tells peHUB.

MathZee isn’t shopping for the funding yet, but when it does, Yadav says, he knows better where to look, as well as how to answer some hard-nosed investor questions, thanks to this past summer. In August, the four-person company graduated from the first-ever session of Chicago-based incubator Excelerate Labs, a three-month program that, like Y Combinator and TechStars, gives nascent startups administrative resources to build their products and services, as well as access to mentors and funding. (Funding runs from $15,000 to $20,000 for a 5% stake in the company.)

MathZee was one of nine startups to emerge from Excelerate. And while Yadav suggests that its nominal financial support won’t go far, he says the experience of meeting with 17 more than 70 different mentors over the course of one month three months will.

“The [investors and advisors] were extremely helpful in forcing us to answer tough questions, like how to tackle the noise in this market,” says Yadav, who adds that the mentors were mostly from the Chicago area, and included Groupon co-founder and major stakeholder Eric Lefkofsky, whose wealth Forbes recently estimated at $750 million. Brad Keywell. (Correction: Yavat called in to clarify that he did meet separately with Lefkofsky, but that Lefkofsky was not a mentor for Excelerate. He added that “most” but not all of the mentor meetings took place within one month.)

“In terms of investments, I’d say that [Chicago-area investors] lean toward investing in later-stage companies,” says Yadav. “So in our case, our focus, stage and business model might [be more appealing] to Silicon Valley,” he says. “But it’s really good to meet with investors who are more conservative than in the Valley because you have a far more refined business model by the time you need money.”

So what is MathZee’s business model? Right now, the idea is to publish one new game a month for the iPad and iPhone, and to give customers access to all of them on a subscription basis that will range from $5 to $15 a month.

Though seemingly pricey — Yadav argues that “it’s where most math education companies are” — MathZee is hoping to appeal to parents and teachers by eschewing textbook-style questions for games like Piggy Math, a counting game released last month, and Ice-Cream Math, which will invite children to run a virtual ice cream shop and learn about measurements based on customers’ orders. And all the while, according to the plan, the games will be forming “non-intrusive assessments” that can help parents and teachers address a child’s math weaknesses.

MathZee is still working on its lineup — Ice-Cream Math is expected to be published next month, and a game called Submarine Shapes that invites children to collect sea treasure is planned for release soon after. Once the company has gotten more of its games before users — and collected more information about user patterns and marketing data — it will begin seeking out seed funding.

In the meantime, Yadav is pursuing his MBA from the University of Chicago, along with several classmates who’ve come together to form MathZee, including a former Goldman Sachs analyst and an award-winning former educator.