Grateful Deed: Lessons from the Startupalooza Tour Out West

--> Startupalooza arrived in L.A. with quite a following. People traveled miles to participate. The winner came from the Philippines and some even followed us up the next day to Menlo Park for our Silicon Valley debut.

Great Landing in Silicon Valley

If it felt a little like a rock tour, it was kind of deserved. A little New York attitude and access to our capital is much appreciated and Startups relished the chance to win an appearance at the National Business Investor Forum in NY worth $3500.

The point of our tour is that entrepreneurship may now be everywhere but not so with financing. Startups need all kinds of help and while there ideas that certain areas favor there may not be funding. More commonly, the ideas are better appreciated elsewhere. New York doesn't love deep tech as much as Silicon Valley or Boston and they don’t care that much for media or ecommerce platforms either. No one likes government plays as much as DC does, and so on…..

The winner in L.A. was a LoyalCoin, a cryptocurrency supporting a loyalty marketing program. The founders and company are from the Philippines where it has gained traction, already raising $2 million.

Most dapper pitcher in L.A.

It was only in L.A. that they could launch big time.

In Silicon Valley the winner was Orion Span, a company that could only have been taken seriously in Silicon Valley because it was raising $14 million to launch - Space Hotels. Yet it turned out to be a very credible pitch by a company laden with former NASA engineers. Turns out everyone is talking about rockets for space tourists but not about a comfortable place to stay once they get there! Enter Orion Span.

These guest rooms don’t come cheap – about a half million a day - but that didn’t stop our investors from wanting to help find just the right billionaires to fund this….

As for DC, the winner was TruGenomix which has a genomic blood test that that

DC Winners: TruGenomix

predict PTSD in soldiers. Since the execs have strong ties to the military, getting some type of sale is a shoo-in. But, as skeptical New Yorkers we still have to ask, does the military really want to know? After all it would limit their pool of potential soldiers.

What a cliffhanger!

Yet, it all illustrates what makes Startupalooza so interesting as we go about finding the terroire in startups. What make certain startups come from certain regions and how does that map to the inefficiencies in funding? Our biggest deals like Nomi Beauty and Alyce were form investors outside of their home towns.

To paraphrase an old saying, profits (OK, prophets) are not always honored in their home towns.

As a national funding network, we are out to solve that problem!

Thanks to all our partners, Brian MacMahon and ExpertDojo in L.A., Maryanne Morrow and Spaces Menlo Park and The Yard in DC for making this all possible!

  

DC Judges at work

L.A. Pitching

Silicon Valley

Silicon Valley Judges at Work

Sachin Narode of Xeniapp

Winners:

L.A.  LoyalCoin

Franco Dagelet,   franco@appsolutely.ph

LoyalCoin is the cryptocurrency that redefines customer loyalty programs by replacing traditional rewards points with a dynamic digital currency that can be used to redeem rewards, trade for other currencies, and more. LoyalCoin is the token that serves as the official virtual currency of the new “Loyalty Economy” Appsolutely is building. The goal is for consumers to be able to earn and spend LoyalCoin whenever and wherever they prefer to buy goods and services, from merchants who participate in Appsolutely’s loyalty ecosystem. This creates an open loyalty ecosystem where the consumer decides where and how they’d like to redeem the rewards they’ve earned. 

Comment: This is a good example of a preferred player in a hot new area. However, this is an experienced team with an Initial Coin Offering that has laready taken hold in the Philippines an in this case looks like it could fly in the US.

Silicon Valley

Orion Span, Inc.  

Frank Bunger, Founder & CEO        frank@orionspan.com 415-430-5154           

Orion Span's mission is to build & sustain human communities in space. We're building a low cost, turnkey, modular, and scalable space station in low earth orbit (LEO) for astronauts, space tourists, and space research.

Comment: If things work out,, we can help get you past the space race – and into a nice place in space. For an extended vacation, that is. This was credible, slightly awesome pitch to finance the space Marriott in outer space. Cool!

Washington, DC

TruGenomix

Yusuf Henriques, Chief Executive Officer yusuf.henriques@trugenomix.com  3019156472

Trugenomix Health is developing the first genomic blood test to accurately diagnose PTSD. This objective genomic blood test for PTSD will result in early diagnosis, early intervention, improved clinical decisions, and improved patient outcomes.

Comment: This is a breakthrough idea – predicting PTSD vulnerability though genomic test. The big plus is that the founders are insiders with deep contacts in the first customers – government and the military. The big questions are whether the money is really there for these tests and can they can scale their prediction model for other kinds of behavioural issues.

Runners Up

L.A.

6 Ft Tall Men

Comment: This defines a targeted audience. What sold it is they don’t just sell longer clothing to longer people but apparel like shirts are actually structurally different - and so they make their own structurally different shirt.

Silicon Valley

SmartFit   

Esther Elkouss, CMO             e.elkouss@gmail.com             917-588-7420

Comment: In the ever-searching quest to shop without going into a store or even trying anything on this is the solution for precisely measuring your body. Ideal for lingerie and swimwear, it requires the one time use of a low-cost tracking garment. The question is whether the public will adopt it and who will pay for it?                                                                                                                                                               

Washington, DC

Namedrop

Joseph Terpstra, Cofounder jterpstra@namedrop.co 703-408-3236

Namedrop: The word of mouth market. An app for independent professionals and gig workers to turn their friends and clients into personal booking agents for their business and side hustle.

Startupalooza Makes a Porno? Results from the September Startupalooza

Startupalooza Makes a Porno? Not exactly but we had some fun!

Thanks to pointed questions from our panel of Angles, what started out as a presentation for nice-looking, if pricey laptop chair, turned into a risqué romp

 This spring-loaded recliner is more that a stationary rocking chair that lets you work in added comfort, it is a piece of furniture that, shall we say, takes your laptop to another level.

Make that two laptops.

Just to be sure, one of our panelists, Investor, Sandy Wollman from Westchester Angels,  put it to the test with a little help from the co-founder, Lisa Kaczmarek.

Guess – who turned out to be a winner?

           

 Winner of the National Business Investment Forum Prize worth $3,500

Archer Bowchair
Lisa Kaczmarek, ladykaz@bowchair.com, 412-944-6555Leveraging over 30 years of custom "one off" fabrication experience, Kaczmarek Composites was formed in late 2016.  Our passion is the combining of dissimilar materials into cohesive works of functional art.  Whether joining carbon fiber with aluminum or wood with steel, each component brings unique strengths and weaknesses which must be respected in order to create a lasting piece of luxury furniture.  We are a small, rapidly growing custom furniture maker located in Pittsburgh, PA.  
All of our products are American made from environmentally responsible, locally sourced raw materials whenever possible.   

Comment: A show stopping demo that turned this profitable custom furniture maker with a pricey chair into a potential mass market darling.

Runner Up – Winner of the Nessa Group Consulting Prize worth $1,000

Medsender

Zain Qayyum, zain@medsender.com            

Medsender enables Doctors to digitally send and receive health records from ANY EMR system. Individual practitioners can have Medsender setup within 2 minutes and instantly begin HIPAA compliant communications.        

Comment: This simple solution to a big problem is making inroads. It seems almost too good to be true and given the highly regulated space just needs a little more buy-in to tip the investor balance.    

                                                                                                             

Special Mentions

Gooroo 

Scott Lee scott@gooroo.com 917-868-2947 

Gooroo is the Airbnb for tutors where students can easily look through 1000+ certified tutor profiles and book instantly. Check the tutor╒s schedule, read a blurb about their educational background, look through student reviews, and view their hourly rate. It's personalized education for the masses - done digitally.

Comment: A well executed delivery about a company with revenues. The competitive environment and the customer churn gave some investors pause.

Vtry Inc. 

Eugene Liu eliu@netstarsoft.com703-594-1231 

Comment: Very interesting technology for virtual tryout in 3D. The competitive environment, concern over the business model and need for additional applications were the concerns. 

Desiclik.com

Deepak Agarwal dagarwal@desiclik.com516-495-3374 

A vertical e-commerce marketplace meet the demand of 3m Indians in the US and others with unique products of India. 

Comment: Well executive business in a niche market. It needs to point to a bigger universe in order to be fundable past the strategic players and stakeholders in this community.

Startupalooza Startup, Kubient gets $250,000

AdTech startup Kubient's Paul Roberts stops by our booth to show off his $250,000 check from our Startupalooza judge Ben Jen of Ben Jen Holdings.

Startupalooza opens in L.A. at Expert Dojo in Santa Monica, Dec. 4th and Silicon Valley, Dec. 5th.

Grit or Gold? How to Make Your Startup Shine

From The Book: Are You Fundable? To find out more about the way Investors think you can get our book Are You Fundable? on Amazon Amazon, Kindle or directly from our site areyoufundable.com.

Like minerals or metals, no two business sectors have the same inherent value. Some are gold and some are gravel but if you understand how Investors rank these companies you could turn this around.

While the crowd will always be attracted to the next shiny thing, most money is made on reliable, boring and often unappealing businesses.

Remember that mining gold can be prohibitively expensive while digging up gravel is cheap and is used every day and everywhere.

Although gold will always get more attention than grit, there are many ways to make your gravel look like gold to Investors.

So if you don’t have gold learn how to make your gravel look like it - usually by showing that you can make profits with much lower risk and startup costs.

Here are some ways to do this:

1. Is Your Industry Offering Support or Sales?

The no. 1 attraction to investors is growth - dramatic growth. So no matter how ugly the industry, if your business increases sales or any kind of business activity - especially if it enables business growth that would not otherwise occur - you may have gold.

Gold: Examples of Sales Enablers or Boosters:

• Door Opener - If your business enables companies to enter markets they previously couldn’t reach.

• Sales Booster - When companies that were local can now go global or that could only sell in one category can now sell in more. This is especially good if these are high-growth low-competition categories.

• Sales Platform - Investors are most interested in platforms that allow others to bring the value and then you get to take a cut (think: stock market, auctions etc.)

2. Sizzle or Snooze: Businesses that Will Put Investors to Sleep - or not.

You may love what you are doing and think it's the most important thing in the world. Investors will almost always see it differently. The good news is that if you understand this and think creatively, you may be able to turn that around.

Grit - Examples of businesses Investors don’t love - but which you can still turn around. 

If your business plan is based around the following, be aware that they may sleep-inducing triggers for investors:

• HR, customer or corporate support. These are expenses and not sales growth inducers. They are hard to measure and often managed by gatekeepers with limited budgets and murky agendas.

- Possible solutions: if you can show these really make a difference or have happy returning customers, then say so up front - it could make a difference! Otherwise, you always want to frame a new paradigm in the industry and claim to have a platform that other players will have to use to enable overall growth.

• Government agencies of any kind

- Possible solutions:  If you have special access of some kind. Contracts or something along those lines, you have a chance. Otherwise only investors who know that specific branch of government will be interested. They are just too many gatekeepers with murky agenda to interest Investors.

• FDA Trials

- Anything that requires money for trials is a no-no for general Investors. Specialized Investors might be interested but only if they have experience in the area.

- Possible solutions: Find areas to prove the idea that don’t face these upfront barriers. Sometimes it is a game or an overseas market. Find it.

• Education

- Possible solutions:  There are some known areas of value here - such as SAT and GRE’s and so on. Anything that “cuts the fat belly” of the industry by more than 70% might be of interest to investors but they generally have to be specialized or experienced in Education. For most investors there are just too many gatekeepers with murky agenda to interest them.

• Ad supported Media

- If your business plan just assumes it will be supported by advertising - and you have never been in the business of selling ads - then you may be in trouble. Ad networks don’t pay that well, and ads generally don’t sell by themselves. You need a sales force to handle customers who are generally hard and fickle. The only want to get around this is to show that you can sell or that for some compelling reason you have partners that deliver sales. Better yet, your idea is so good that at least 10% of your users are willing to pay a subscription fee.

• Value is in the Data

- In an era when hackers can steal credit card info from Equifax of download the CIA’s list of most active spies, your amazing data just doesn’t seem so valuable any more. However, if your tool or platform enables others to extract data - which you also get to keep - then you might have something. Real-time actionable data is different though. That is like fresh fish - and people will always prize that. You just have to show the investors who your fish buyer is.

           

From: Are You Fundable?

Order the Book Are You Fundable?

Is Your Startup Gravel or Gold? How to Make it Shine, Regardless.

From The Book: Are You Fundable? To find out more about the way Investors think you can get our book Are You Fundable? on Amazon Amazon, Kindle or directly from our site areyoufundable.com.

Like minerals or metals, no two business sectors have the same inherent value. Some are gold and some are gravel but if you understand how Investors rank these companies you could turn this around.

Remember that mining gold can be prohibitively expensive while digging up gravel is cheap and is used every day and everywhere.

Although gold will always get more attention than gravel, there are many ways to make your gravel look like gold to Investors.

Remember that while the crowd will always be attracted to the next shiny thing, most money is made on reliable, boring and often unappealing businesses.

So if you don’t have gold learn how to make your gravel look like it - usually by showing that you can make profits with much lower risk and startup costs.

Here are some ways to do this:

1. Is Your Industry Support or Sales?

The no. 1 attraction to investors is growth - dramatic growth. So no matter how ugly the industry, if your business increases sales or any kind of business activity - especially if it enables business growth that would not otherwise occur - you may have gold.

Gold: Examples of Sales Enablers or Boosters:

• Door Opener - If your business enables companies to enter marekts they previously couldn’t reach.

• Sales Booster - When companies that were local can now go global or that could only sell in one category can now sell in more. This is especially good if these are high-growth low-competition categories.

• Sales Platform - Investors are most interested in platforms that allow others to bring the value and then you get to take a cut (think: stock market, auctions etc.)

Businesses that Will Put Investors to Sleep.

You may love what you are doing and think it's the most important thing in the world. Investors will almost always see it differently. The good news is that if you understand this and think creatively, you may be able to turn it around.

Gravel - Examples of businesses Investors don’t love - but which you can still turn around. 

If your business plan is based around the following, be aware that they may sleep-inducing triggers for investors:

• HR, customer or corporate support. These are expenses and not sales growth inducers. They are hard to measure and often managed by gatekeepers with limited budgets and murky agendas.

- Possible solutions: if you can show these really make a difference or have happy returning customers, then say so up front - it could make a difference! Otherwise, you always want to frame a new paradigm in the industry and claim to have a platform that other players will have to use to enable overall growth.

• Government agencies of any kind.

- Possible solutions:  If you have special access of some kind. Contracts or something along those lines, you have a chance. Otherwise only investors who know that specific branch of government will be interested. They are just too many gatekeepers with murky agenda to interest Investors.

• FDA Trials

- Anything that requires money for trials is a no-no for general Investors. Specialized Investors might be interested but only if they have experience in the area.

- Possible solutions: Find areas to prove the idea that don’t face these upfront barriers. Sometimes it is a game or an overseas market. Find it.

• Education

- Possible solutions:  There are some known areas of value here - such as SAT and GRE’s and so on. Anything that “cuts the fat belly” of the industry by more than 70% might be of interest to investors but they generally have to be specialized or experienced in Education. For most investors there are just too many gatekeepers with murky agenda to interest them.

• Ad supported Media

- If your business plan just assumes it will be supported by advertising - and you have never been in the business of selling ads - then you may be in trouble. Ad networks don’t pay that well, and ads generally don’t sell by themselves. You need a sales force to handle customers who are generally hard and fickle. The only want to get around this is to show that you can sell or that for some compelling reason you have partners that deliver sales. Better yet, your idea is so good that at least 10% of your users are willing to pay a subscription fee.

• Value is in the Data

- In an era when hackers can steal credit card info from Equifax of download the CIA’s list of most active spies, your amazing data just doesn’t seem so valuable any more. However, if your tool or platform enables others to extract data - which you also get to keep - then you might have something. Real-time actionable data is different though. That is like fresh fish - and people will always prize that. You just have to show the investors who your fish buyer is.

           

From: Are You Fundable?

Order the Book Are You Fundable?