Flashpoint Demo Day Startups January 2012

Today I had a great time watching 15 startups in the Flashpoint cohort give six minute pitches at the Georgia Tech Research Institute. The teams have been working together since September 2011 and have made amazing progress.

Here are notes from the 15 startups:

Social Fortress
Eliminate key risks associated with putting sensitive data into the cloud.
Cloud isn’t as prevalent with financial services, healthcare, government, and IP rich industries
How it works:
1. Uniquely encrypt and tag all data.
2. Provide global audit trail.
3. Provide universal credentialing.
Security and privacy are cloud adoption inhibitors
Biz model: per seat monthly license
Executed term sheet to raise up to $2M

Lucena Research
Bridges hedge fund technology to individual investors
Quant in a box
Like speed checkers, not chess
People want to trade, and tools enable them
Powered by artificial intelligence and machine learning
Growing trend where people want to manage their own money
Smaller hedge funds can’t afford full quant staff
3 Questions investors want answered:
Which way is a stock headed?
How can I bound risk?
How did it work in the past?
Raising $1M for R&D, development, sales, and marketing

CollectorDASH
A social and mobile ecommerce platform
Collectors are unique consumers – social and super-passionate
Collectors: discover, manage, share, trade, buy, and sell
Started as platform for repurposability
Action figures first, then trains, then American Girls, etc
Go to market via OEM or strategic partners e.g. dealers/retailers, manufacturers, brands/licensors, affinity groups/clubs
www.Collector-ActionFigures.com is live today
Going to market with Trainz.com
Make money on premium subscriptions, transaction fees, and other sales
Raising money

Badgy
Social “likes” are similar to SEO inbound links
Marketers spent $20B last year on SEO and SEM
What’s after the “like”? 88% of Facebook “likes” never return
Quilted Northern is a customer
Several paying customers
Charge $5-$10k based on number of Fans
Raising $800k
Building self-service platform

Sports Crunch
Enables athletes, coaches, and fans to connect
Reconnect, replay, relive
Social networks have noise
Derek Anderson is an advisor
Sports is the universal unifier
Ability for athletes and coaches to upload content for timeline
Make money through advertising and premium services
Raised money through ex-ISS CTO and Flashpoint
Raising $750k seed round

Trimensional
3D scanner for iPhone
Capture digital 3D models in seconds using an iPhone or iPad
Replacing $20,000 piece of equipment with an app
Used in entertainment, 3D printing, medicine, security, mechanical engineering, industrial design
Entertainment: Actors are digitized via expensive 3D scanning
Put fans in the background of films and video games
Users upload their images into the Trimensional database
50,000 paying customers in 2011…and they can’t do anything
In discussions with film and media industry
Applied for provisional patents
Raising $500k

eCommHub
Put your store on autopilot
Problem: no standard way of communicating with third-party vendors
Vendors have own requirements / file formats
eCommHub is a self-service middleware that automates inventory management and order processing through any third-party vendor
Nearly $2M processed through product already
Integrated with Shopify already (top 5 shopping cart vendor)
Going to expand to top five shopping cart platforms
SaaS business model based on # of vendors, products, and orders
Raising $450k

CodeGuard
Time machine for websites
Continuous site monitoring with alerts and backups
$10/month/site on average for paid plan
Targeting the shared hosting segment of the market
95% of the market underserved (enterprise is served)
Customer acquisition direct, through developers, and through hosting companies
Raising $1.2M
Taking prototype to commercial product
Integrating technology with major resellers

IdeaString
SaaS social business solution
Companies need a way to capture their collective brain-power for innovation
Historically little innovation to drive innovation
Helped Celanese realize $9 million in immediate cost reduction by generating 4-6 new ideas per day
A top priority is to find ways to reduce costs through innovation
Application: part idea exchange, social network, and event management all focused on innovation
Raised money from angels

Soket
Companies need to manage their site, Facebook, Twitter, Foursquare, Yelp, OpenTable and more
Social content management system for people managing content engagement for multiple local businesses
Social LSM: Social “Local Store Marketing”
Sell directly as well as through channel with marketing agencies
Per month per store subscription fee
Raising $1M series A funding

N4MD
Content aggregation publishing platform
Help repurpose content into e-books
Interest server: smart web crawling robot, human curating interface, publishing tool to popular mobile apps
Home Depot – Spring time is their big season so interested in brining social, local content to customers conversation for hundreds of stores
Raising $500k

Simmer
Easing conflicts at home
Targeting parents of teens age 13-17
Goal is to ease the fighting and help communicating with teens
Resources, tools, and technologies to help
Looking for investors who have a shared interest in solving this problem

Billfold
Awesome billing system for web hosting
Web hosting is a $10B market with 35,000 companies
10% of revenues are spent on billing
Web hosting billing software is all installed, not in the cloud
SaaS billing system with PCI compliance for hosting companies
Take billing from 10% of revenue to 4% of revenue
Adjacent telecom markets like VoIP, ISPs, and media
Raising a round

Saving Grace
Fundraising service for churches and congregants using daily deals
Use the church as a channel for deals
John’s Creek United Methodist Church has 3600 members and has 150 businesses within a short drive, all with a vested interest in the community
Stewardship is the responsible use of what’s given to us
Help churches save money, help people save money, and help merchants find customers
Raising $300k

Pindrop Security
Focused on stopping phone fraud
Came out of PhD research from GA Tech
Caller ID is broken
Phone fraud is easy to do by calling consumer to get info then call bank and pretend to be the customer
$37B in identity theft annually with 10% starting by phone
Phone verification solution that shows every phone call has a unique fingerprint
Determine type of phone, geo-location, fraud caller, caller identity
Products:
Reputation portal and intelligence feed
Anti-fraud call analyzer
Call authenticator
Call protection apps
Raised $255k
Raising seed round of $1M

The teams did a great job and I was very impressed. The next Flashpoint cohort starts June 4th, 2012.

Flashpoint Demo Day on January 10th

Next Tuesday, January 10th is the first Flashpoint Demo Day at Georgia Tech Research Institute. Flashpoint is a startup accelerator that is part startup school and part startup factory. With 17 companies in this first cohort, there are a variety of strong B2B and B2C technology startups.

Flashpoint is actually having three Demo Days in January:

• Atlanta on January 10th at Georgia Tech Research Institute
• New York City on January 18th at Union Square Ventures
• Menlo Park on January 26th at Andreessen Horowitz

Earlier today it was announced that Andreessen Horowitz invested in Pindrop Security, one of the Flashpoint cohort startups — a great prelude to the Demo Days.

I’m looking forward to Demo Day next week and I’m impressed by the progress the startups have made over the last 90 days.

What else? What are your thoughts on Flashpoint and accelerator Demo Days in general?

The Experience Economy at the Mall

I’m not much of a mall guy. The experience shopping on Amazon.com, especially with Amazon Prime, is amazing, cheaper, and much more efficient. So, today, in an effort to get the kids out of the house, I took my two little ones to North Point Mall 20 miles north of where I live. North Point was chosen, instead of Lenox and Phipps nearby, due to the American Girl store.

Even though my daughter is too little to know much about the American Girl store she loves dolls, and the American Girl store didn’t disappoint. In the store they have a full restaurant, dolls, girl clothes with matching doll clothes, and a spa for the dolls. Yes, you read that right: they style the doll’s hair and clean their face/nails/etc as if they were people. It’s really quite frightening, but girls love it. The line for it was 10 people deep when I was there.

Amazon.com is competing less and less against the mall, especially North Point Mall. Malls and stores in the mall are offering two things Amazon.com will never offer: vertically integrated brands like Banana Republic and experiences like doll spas. Malls are a natural venue for the experience economy and today’s visit was no exception.

Here are experiences I saw going on at North Point Mall:

• Cafe and doll pampering at the American Girl store
• Build-a-Bear Workshop where you can build your own teddy bear
• Food court with tiny tables and chairs the perfect size for toddlers and little kids
• Carousel (merry-go-round) in the food court for $2 per child (adults not allowed)
• Train tours for five minutes around the stores for $4 per person
• Playground inside near Dillard’s
• Massage kiosk (people giving the massages, not massage chairs)
• Santa pictures (santa wasn’t there today but I’m confident he was there last month)

This doesn’t even include services inside the mall like haircut places and spas (for real people).

Over time the gap between what Amazon.com offers and what malls offers will grow. Malls are part of the new experience economy.

What else? What are your thoughts on malls becoming more and more about experiences?

3 Year Personal Development Plan

At the end of each year I reflect on the past 12 months and set my New Year’s Resolutions. As part of this process I also spend time updating my 3 Year Personal Development Plan. My 3 Year Personal Development Plan is a simple Google Doc with four categories of information: personal, family, professional, and community. For each category I have 3-7 bullet points with ARMD goals that are tactical.

Here are some example categories and items for a 3 Year Personal Development Plan:

• Personal
  Workout 2x per week
  Meditate 2x per week
  20 tennis matches per year
  10 rounds of golf per year
  2 cool sporting events per year
  Financial savings (size defined for each year)
• Family
  Spouse date night every week
  Dinner as a family 5x per week
  Quarterly week-long vacation
• Professional
  Company size (size defined for each year)
  Read one book per month
  1 workshop/learning event per quarter
  2 conferences per year
  6 trips per year
• Community
  Donate $X per year
  2 non-profit boards
  Volunteer X hours per month

This format provides structure and personal accountability that is fairly broad. I recommend developing a 3 Year Personal Development plan and reviewing it several times per year.

Have a great 2012!

What else? What other items would you add to your 3 Year Personal Development Plan?

Signs the Economy is Improving at the End of 2011

Over the past month I’ve heard more and more signs from front-line entrepreneurs that the economy is starting to get a little better. It could just be a seasonal thing with the holidays but the information is based on comparing Q4 of 2011 to Q4 of 2010. Now, I don’t think the housing market is going to improve for many years but there are signs other parts of the economy are getting better.

Here are some signs the economy is improving:

• One startup that offers a 10% discount to clients that pre-pay for a year in advance instead of paying quarterly has seen an up-tick in pre-pays, indicating their clients feel more confident about their financial position and are investing in new tools
• One company that sells directly to consumers has seen same store sales grow 50% faster in 2011 compared to 2010
• One business signed more new customers in Q4 than the rest of 2011, and Q4 isn’t normally a good quarter

Obviously, this sample size isn’t large enough to be statistically significant but anecdotally it appears that things are getting a tiny bit better.

What else? What other signs have you seen that the economy is improving here at the end of 2011?

Notes from Flashpoint Meeting with Sigma Partners

Tonight we had the opportunity at Flashpoint to do a Q&A with one of the general partners from Sigma Partners. He fielded a variety of questions, primarily around venture capital, and provided candid answers. Here are a few notes from the talk:

• A typical Series A for them involves co-leading with another investor, buying 50% of the company, and carving out 25% for founders and 25% for future employees (e.g. $6 million invested on $6 million pre-money valuation)
• It took a week to raise their previous fund by calling on their existing LPs whereas their next fund will take significantly longer due to contractions in the market
• Many funds from 2007 haven’t returned any money at all to LPs resulting in even more challenges for VCs to raise new funds with the expectation that many VCs will go out of business in the next five years

Flashpoint is a great accelerator and I enjoyed listening to the Q&A with Sigma Partners.

What else? What other thoughts do you have on VCs and the fundraising market?

Notes from Greg Foster at Flashpoint

Image via Wikipedia

Greg Foster, CEO and co-founder of BrightWhistle (marketing platform for multi-location healthcare companies), was the guest speaker at tonight’s Flashpoint meeting at Georgia Tech. His message was focused on entrepreneurial lessons learned. Here are a few notes from his talk:

Greg did a great job telling stories and sharing his lessons learned.

What else? What were some other lessons learned shared at the event?