TechStars Seattle Demos: One Room, 10 Startups, Tons of Potential
David Cohen has seen this movie before. As the founder and CEO of TechStars, he knows that the first year in any city is about building community, making impressions, and proving the model. Then things get turned up a notch.
“Year one is a lot of excitement, the town really supports it,” Cohen said. “People come out to the first Demo Day and they see it for the first time as a finished product, and people talk about it. Year two, you get a much bigger audience. I’ve seen that pattern everywhere.”
Seattle is no exception. The second-ever TechStars Seattle Demo Day, held Thursday afternoon, saw attendance way up, with 350 or more investors, entrepreneurs, and insiders flocking to the SoDo neighborhood to see some of the hottest startups in town. The competition was fiercer, with 700 applicants for just 10 spots, compared with 400 a year ago.
And the money was flowing faster—as of Thursday’s demos, nine of the 10 proto-companies already started raising financing rounds, TechStars Seattle director Andy Sack said.
“Last year, the companies coming out of TechStars 90 days after Demo Day had successfully raised over $2.5 million,” Sack said. “This year, coming into Demo Day, the companies have already raised over $3.5 million.”
Here’s a rundown of the 10 companies that showed themselves off Thursday evening, with some key notes from the presentations. We’ll have more from Cohen later, as he looks at the trends in companies and incubators overall, and some more thoughts from Sack on year two of the Seattle TechStars experience.
Tagline: Enables convenient international money transfers from the U.S. to a mobile phone abroad
Beamit is targeting the huge market of international remissions—the money that immigrants send back to friends and relatives in their home countries once they get to America and start earning cash. That amounts to $325 billion globally each year, CEO Matt Oppenheimer said, with 80 percent handled outside the traditional banking system.
Beamit seeks to make those transfers easier and cheaper by using mobile devices and the Internet as a platofrm. People in the U.S. will be able to send money to a virtual wallet in another country online or through a mobile app, which the recipient could either spend from their device or cash out at a traditional transfer office.
The first test market is the Philippines. Beamit can make transfers free for its most loyal customers, Oppenheimer said, which implies that Beamit makes money on fees of some kind. The startup already has closed a $750,000 convertible note, and is raising a Series A round.
Tagline: Turning brand advertising into daily viral campaigns.
The former employees of Pelago, which was acquired by Groupon, have a platform that allows retailers and other brands that offer loyalty or rewards programs to increase consumer spending by offering casual games as a hook, rather than dry, boring email campaigns.
The loyalty market has more than 2 billion memberships, but two-thirds of them (66 percent) are inactive, co-founder Chad Reed said. Early tests show the concept has shown a ten-fold increase in the use of loyalty programs, Reed said.
Customers include Murphy USA, which operates gas stations like those seen at Wal-Mart locations, and Caesar’s Entertainment, the casino company. Bluebox Now is raising a $500,000 round, with $100,000 already committed as of the presentation.
Tagline: Rewarding and inspiring people to a healthier lifestyle.
One of the health-minded startups on stage Thursday, EveryMove seeks to connect consumers with rewards from their employers, health insurers, and other brands by collecting, tracking, and visualizing health-related data. So, if a user checks into their gym via Foursquare and completes a series of runs via Runkeeper, they could qualify for a discount from their insurance company.
In one of the most energetic presentations of the day, co-founder Russell Benaroya pitched this as a social movement, a huge business opportunity, and a no-lose proposition for everyone involved. Advertisers get targeted access to health-conscious people, employers and insurers and consumers save money, and users get healthier. EveryMove makes up to 20 percent on the rewards that flow through the system.
The company, whose other co-founder is Seattle 2.0’s Marcelo Calbucci, announced a deal with insurer Premera BlueCross, with plans to target other BlueCross insurance networks around the country. Expect to see more news over the coming months about specifics on the Premera deal. EveryMove had already commitments for $1 million out of a $1.5 million round.
Tagline: The Best Way To Save On Healthcare.
A topic that’s surely close to the heart of freelancers and entrepreneurs, but really anyone who’s tried to fill in the gaps of their health insurance, is the confounding pitfall of flexible spending accounts for health insurance. You can save money by setting aside cash pre-tax to pay for health expenses, but if you don’t burn it by year’s end, it’s gone—costing consumers money and actually encouraging overspending in a health care system plagued by high costs.
FlexMinder attempts to solve this problem by giving consumers a virtual dashboard, receipt tracker, and payment system that pulls all of their health spending data together in one place. That helps consumers get ahold of the estimated $3 billion annually that falls through the cracks unspent in flexible spending accounts, co-founder Deepak Kumar said.
FlexMinder already has a strategic relationship with Regence, the biggest health insurer in Washington state, and deals with employers that give it a potential reach of about 1 million users, Kumar said. The startup has commitments for $200,000 out of a $500,000 round.
Tagline: Matching social media commercial intent with merchants.
GoChime recruits a crowdsourced network of social media users who can answer the queries of other people looking for products or services on behalf of businesses and providers who want to tap into that demand.
It struck me as a kind of Amazon Mechanical Turk for social media advertising campaigns, enlisting individual people to recommend a particular brand when a user in the wild is casting about for something related. And that human-to-human connection makes campaigns through GoChime vastly more effective than traditional online advertising, the startup said.
The offers and campaigns can be sourced through affiliates, with direct relationships established once they identify a promising segment. The crowd of “Chimers” work for “rewards, recognition, and money,” co-founder Austin Evarts said—GoChime takes a commission on campaigns, and shares a portion with the people who do the work. GoChime is raising $600,000 now, and has $350,000 committed already.
Tagline: The high-end marketplace for software projects.
If you’re a designer or developer, there’s no job crisis right now—unless it’s an impossible choice of which job to accept. And for tech companies, that means it’s ridiculously hard to hire top talent, to the point that major employers have made the acquire-to-hire model a job recruiting trend.
There are already companies that try to tap into the reservoir of unaffiliated tech talent that, for one reason or another, prefers to go the mercenary route and just pick up piecework here and there instead of getting an office and a big fancy job. But the founders of GroupTalent say there’s not enough vetting online, which means the existing players like oDesk and eLance become a “race to the bottom.”
GroupTalent wants to establish a top-tier online-only market for freelance tech talent, aiming to be the place that the top 20 percent of designers and developers find work. They aim to do this by pulling in data from around the web, including scores and rankings through coder forums like Github and Stack Overflow.
After going live with a small amount of exposure, the site claimed 300 applications from developers and some $500,000 in projects submitted. GroupTalent makes its money by taking 10-20 percent on the project price, which they say averaged $40,000 in the test run. The startup is raising $500,000, and has $200,000 already committed.
Tagline: Where the great guys are.
Online dating is increasingly popular, but the team from LikeBright says there’s a clear problem: Not enough women. The startup wants to solve that problem by allowing women to rank single guys through Facebook, giving other single women a gauge of whether their peers would vouch for a would-be date.
“We don’t think of ourselves as a dating site, but we do make dating a lot easier,” co-founder Nick Soman said, by applying a dating layer to Facebook. The company’s technology pulls in Facebook profiles of men, and allows women to “vouch” for a good guy by ranking his positive attributes or giving short testimonials.
Men end up with profile pages in a women-centric dating network, and women can use the service without creating a profile themselves if they wish. LikeBright tested its concept with a contest, and got 400 signups—70 percent of them women, which Soman said blows away other online dating concepts.
The company plans a freemium model that charges once users who want to explore the dating pool outside their friend network. LikeBright has commitments for $200,000 out of a $600,000 round.
Tagline: Turn your smartphone into a robot.
Just like the description says, this startup offers a $40 hardware kit that allows users to plug their iPhone into a little cradle that powers a pair of small tank-style tracks, while displaying a cute little animated face on the screen. Fun enough—but Romotive sees this as just the beginning, seeking to build a platform for countless apps that would power “Romo.”
The company is already profitable, raising $75,000 on Kickstarter and selling more than 900 robots to hundreds of people around the globe. The company’s longer-range plan involves selling apps that would bring new tricks and behaviors to the Romo, allowing others to develop apps through an API, and licensing the technology.
Romotive makes 50 percent gross profits on the little robots already, without being at scale to any real degree. The company is currently raising a $500,000 round to build out its application platform and seek patents for its technology.
Tagline: Design beautiful, effective online flyers and publish instantly.
This pair of Israeli entrepreneurs have built a platform that allows users to create simple, single-page promotional websites for a business, cause, or event with very little work. It’s meant to reach millions of small-business owners and other “self-service marketers” in the U.S., a “long tail” play capitalizing on a large market of small players.
The Smore team thinks this is a big business opportunity, however. “We already declined an acquisition offer from a very high-profile company that came while we were in TechStars,” co-founder Gilad Avidan said.
Smore pages come pre-loaded with tools for easy promotional campaigns, including social sharing, and analytics to track how well the page is performing. The sites are free to make, with the startup making money on ads that are purchased for Facebook or Google campaigns or e-commerce and fundraising activity. Smore is raising $500,000, with half already committed through Seattle-area angels.
Tagline: Highly visual and interactive personal profiles.
This startup pulls together the truckloads of data that people post online, through profiles in places like LinkedIn and Facebook or location and reading utilities, and even personal blogs. What it spits out is a beautiful, layered, multifaceted personal webpage that showcases personal photos, experience, writing, and other elements of a user’s online life.
Those pages aren’t just static, either. They constantly refresh and update with new data—so if you go on a blogging jag about airline travel or change jobs or post new photos from a trip, the graphs and timelines that reflect your online life will change along with it.
Vizify is a freemium model, giving away basic sites but charging for upgrade packages that target specific professions. It allows real estate agents to showcase their listings and sales, lawyers to brag about their cases and honors, or salespeople to input their numbers or rankings. Vizify is raising $750,000, with $250,000 already committed from investors including Jonathan Sposato and Geoff Entress.
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