venture capital : Innovation + Job News

The local entrepreneurial initiative known as Startup PHL has announced the 2014 winners of its second Call for Ideas grant round. This particular round focused specifically on the matter of student engagement with Philadelphia’s tech community.
 
Five micro-grants have been awarded to local internship programs, business incubators and boot camps that plan to hold seminars, workshops and various other programs aimed at area students.
 
Here is a complete list of the winners and their ideas:
 
PennApps Fellows Internship Program received up to $25,000 to fund 10 internships. The program will connect student interns from across the nation to Philadelphia-based companies for a 10-week internship during summer 2014.

Philadelphia Fashion Incubator received $25,000 to create a series of monthly seminars, panels and interactive workshops focused on the business of fashion.

Zivtech Developer Boot Camp was awarded $24,000 to support a six-week developer bootcamp for a class of 30 participants.

NextFab Fellows Co-op Program received $25,000 to support four co-op fellowships. Students will receive training and materials while gaining experience working with NextFab companies in need of talent.

Technical.ly and Philly Startup Leaders were awarded $25,000 to create and execute a series of eight workshops to better connect the PHL tech community to students and universities.

The $500,000 Call for Ideas grant program -- one of two initial measures supported by Startup PHL -- was specifically designed to fund innovative projects that support Philadelphia entrepreneurs and startups, regardless of which industries they work in.
 
According to Rebecca Lopez Kriss, a Department of Commerce entrepreneurial investment manager, Startup PHL has plans to announce two more rounds of Call for Ideas. One of those will likely happen later this year.
 
If you or your organization is hoping to claim one of the micro-grants, take heed: "Essentially, we're looking for ideas that will improve the startup community in either growing companies or improving talent," says Lopez Kriss. "Or maybe create some sort of network that helps people work better together."
 
For more information about the specific ideas Startup PHL is hoping to fund in the future and the collaboration they hope to encourage between entrepreneurs, mentors and investors, visit their FAQ page.   

Source: Rebecca Lopez Kriss, Philadelphia Department of Commerce
Writer: Dan Eldridge

When the City of Philadelphia entered Michael Bloomberg's 2013 Mayors Challenge last year, winning one of the contest's four $1 million prizes probably seemed a little far-fetched. And yet when the 305 cities that initially applied to the competition -- intended "to inspire American cities to generate innovative ideas that solve major challenges and improve city life" -- were whittled down to 20, and then just five, Philadelphia found itself among the victorious. (Chicago, Houston and Santa Monica were also awarded $1 million each; Providence, R.I., took home the $5 million grand prize.)

This all happened roughly 18 months ago. In the interim, the recently-formed Mayor's Office of New Urban Mechanics (MONUM) has been busy working with the Wharton School's Social Impact Initiative to pound out the kinks in the winning idea, which is being referred to as FastFWD. 

The program is a partnership between the city's public sector and 10 different social entrepreneurs from the private sector. The two spheres will work side-by-side in an effort to solve some of the city's public safety issues, including recidivism and violent crime. The Mayor's Office has agreed to share its city data with the chosen entrepreneurs, who in turn will spend 12 weeks in an accelerator program managed by Good Company Group.

The application period recently ended. Toward the end of May, the resulting business ideas will be primed and ready to hatch -- or at least, that's the idea.

According to MONUM Co-Director Story Bellows, easing up the procurement process and lessening the pain of dealing with the city's notorious red tape is one of the program's three main objectives.

"One of things we like about [the] public safety [initiative]," she says, "is that it's sort of exposing a market in which entrepreneurs have been underrepresented." 

The city is currently exploring revenue models that would allow FastFWD to continue after its initial $1 million is extinguished. According to Bellows, a second round is already in the works. Health-care, education and youth programs are some of the potential themes, and applications for that consortium will be available to social entrepreneurs sometime this summer. 

The initial accelerator program -- taking place at Impact Hub in Kensington -- will officially kick off with an open-to-the-public event sometime near end of February. Stay tuned.

Writer: Dan Eldridge
Source: Story Bellows, Philadelphia Mayor's Office of New Urban Mechanics (MONUM) 

Speaking at IgniteGood's Ignition Philly event last week, Dhairya Pujara demonstrated his mastery of the organization's narrative workshop, which helps participants develop storytelling skills and become better advocates. Pujara's story was clear and concise, and his connection with the audience was authentic.

It is that ability to reach people, and the value Pujara places on his experiences doing so, that prompted him to found Ycenter, a startup non-formal learning center offering international experiences.

Born and raised in India, Pujara came to the United States in 2010 to pursue a M.S. in biomedical engineering at Drexel University. After graduating, he traveled to Mozambique to work in a rural healthcare system for five months. There, Pujara realized how ill-prepared he was to use his engineering skills to solve real world problems. 

"My communication skills were challenged in this Portuguese-speaking war-torn country," says Pujara. "My first few weeks were very shocking and challenging. To collaborate with members in the rural community, I realized the need to understand and be a part of this culture. It didn't matter where I came from, my educational background or my intentions, until I set aside my ego and immersed myself in this new community." 

Pujara's experience taught him the importance of "rolling up your sleeves and getting dirty." After returning to Philadelphia from his time in Mozambique, Pujara developed the concept for Ycenter. 

"Traditional study abroad programs offered by universities are very academic in nature and very formal," he explains. "And then there are volunteer programs, which are not structured for attaining concrete learning objectives. Ycenter's non-formal learning program helps students supplement their formal field of studies and work on community impact projects internationally." 

Drexel Product Design Professor Mike Glaser and Dean of the School of Biomedical Engineering Banu Onaral helped give Pujara direction; Philly VIP connected him with pro-bono legal services from Dechert LLP. Students from Drexel, Temple and LaSalle have expressed interest in applying for the program.

Ycenter's biggest challenge has been raising capital, but Pujara is confident -- he plans to launch the startup's first immersive learning experience in March 2014.

Writer: Nicole Woods
Source: Dhairya Pujara, Ycenter

In the next five years, the market for cloud computing -- the virtual network that maintains web activity -- will reach $40 billion.
 
Cloudamize, a Center City-based company currently partnered with MissionOG, is poised take advantage of that growth. They offer a management tool that helps clients maximize their web performance while minimizing associated costs. The company recently closed its seed round of fundraising with $1.2 million in investment; they are seeking developers and sales associates. 
 
Think of the cloud as a utility with various servers -- or information centers -- communicating to one another. In general, the more complex a web application (and the more traffic it gets), the more it taxes the cloud. That burden can cost companies a lot of money. Most cloud servers are virtual. They exist through specialized software that connects to a larger physical server. This means they can be scaled to fit the required load. Yet, understanding which servers need to be scaled and how can be complicated and costly.
 
"Getting on the cloud is very easy," says Khushboo Shah, founder and CEO of Cloudamize. "But once we get there, we realize we are not getting all the benefits."
 
Cloudamize acts as a smart meter for the cloud. They evaluate how the activity of a web application gets distributed between servers and how that distribution can be improved. The platform then recommends direct actions to increase efficiency. If a client anticipates modifications to their site or changes in web traffic, they can also use Cloudamaize to plan the best possible distribution strategy.
 
"The cloud is supposed to be elastic," explains Shah. "Increase infrastructure when you have peak traffic and dial it down when you don't need it. It's essentially marrying the cost and performance together."
 
Source: Khushboo Shah, Cloudamize
Writer: Dana Henry

LinkedIn might have been created for talent-matching, but Center City-based PeopleLinx is turning the networking site into a marketing goldmine. Their flagship software, Social Business Optimization (SBO), helps companies build bigger brands through employee profiles.

PeopleLinx realized that a company's personel -- and their social media presence -- can function as free advertising. Marketing departments use their product to help employees curate a LinkedIn profile that represents the brand and connects effectively with clients, ultimately generating more sales leads. SBO software is just over a year old, but it's already luring big name brands such as Prudential, Audi and Experian.

"Everything an employee does online is a reflection of that employee's professional life and ultimately the company they work for," says Micheal Idinopulos, chief marketing officer for PeopleLinx. "We're giving companies and marketing departments the tools to enable employees to do good for the company while doing good for themselves."

PeopleLinx, which was founded by former LinkedIn employees Nathan Egan and Patrick Baynes, recently closed their first round of funding with $3.2 million in investment capital from Osage Venture Partners, Greycroft Partners and MissionOG. Their monthly revenues tripled in May, and then again in June. The team has grown to 30 employees and is hiring for positions in sales and marketing, product development and software engineering.

On the heels of this impressive growth, PeopleLinx has also been getting more involved with the local tech scene. They hold regular "fireside chats," inviting startup leaders from throughout the region to share their wisdom with the staff. They are also organizing an upcoming hackathon, tentatively scheduled for September.

Source: Micheal Idinopulos, PeopleLinx
Writer: Dana Henry

It's a big year for Drexel University's LeBow College of Business. The school is gaining a brand new twelve-story 177,500-square-foot building, launching an innovative student investment program and fostering the Dragon Fund, now one of the largest student-managed investment portfolios in the country.
 
The Fund -- which launched during the 2007 to 2008 school year with $250,000 from Drexel's Office of Endowment -- is managed by about 20 students enrolled in advanced finance classes. The group changes each academic quarter. Over the past five years, these student-analysts have earned over $200,000 in returns, despite the recession.
 
With additional contributions from the University, the fund now controls a record $1 million.
 
"It's very difficult to get experience in investment," says Daniel Dorn, associate professor of finance at LeBow. "Industries look for people with experience already. We wanted the students to get exposure."
 
To make the most of their gains, Lebow held ArchiTECH, a competition that paired students with faculty to develop best-uses for the new building. The winning team -- which included Dorn, Ed Nelling, a professor of finance, and David Hunt, a senior finance major-- created a program where student-analysts teleconference with investors from New York, Orlando and further abroad. They can also post their investments online for review by the broader finance community.

"We thought of ways to intensify this experience with industry," says Dorn. "We wanted to extend the classroom."

Such innovations are examples of "reverse mentoring," a new approach wherein students advise academics. "The Office of Endowment considers the Dragon Fund to be one of their investment managers," says Dorn. "It's the students who pitched their services to the university."
 
Source: Daniel Dorn, LeBow College of Business
Writer: Dana Henry

For venture capitalists, good investing is all about assessing risk versus potential. MissionOG, a Berwyn-based investment firm, has found a smarter way: Identify the opportunity and then join the team.

The "OG" stands for "Operating Group," an ode to the team's background and company model. Previous to founding MissionOG, all four members were high-level operations managers (three worked together at Ecount). Since launching in September 2012, they've helped fast-track three of Philly's rapidly growing business-to-business companies: Cloudmine, Cloudamize and PeopleLinx.

"Our roots are in executing in early-stage companies and helping build them from the ground up," says Drew Kese, managing partner at MissionOG. "We wanted to take that to the venture community."

As the software revolution continues to build -- and produce cheaper and cheaper backend web solutions -- the cost of starting a company has steadily dropped. This presents a new challenge: How do you maximize know-how in a market that's rapidly changing? MissionOG works directly with clients. They help manage the logistical side, allowing companies to spend 80 percent of their time "pointing at the market," or probing the market problem as it evolves.

"It's almost too easy from the money side," says Kese. "We're trying to inject some expertise so the money people raise goes further."

The firm is closely connected to DreamIt Ventures. Three of four partners are mentors at the incubator, and two of the three initial companies are DreamIt grads. As they grow, MissionOG hopes to serve three or four companies at a time.

"The time we invest is a differentiator," Says Kese. "The only way to understand the market problem is to roll your sleeves up and understand it intimately."
 
Source: Drew Kese, MissionOG
Writer: Dana Henry

DreamIt Ventures -- the Philly-based accelerator that helped launch SnipSnap and CloudMine – is tackling a particularly challenging industry: Healthcare. DreamIt Health, which launched April 8, focuses solely on companies in healthcare IT.
 
The accelerator’s first class features ten companies including AirCare, a company developed by VenturePact that helps minimize re-admissions through mobile nursing; Osmosis, a tool that helps clinicians retain vast amounts of knowledge during medical training; and Medilo, a mobile healthcare card that details benefits and eliminates the need for forms.
 
Accelerator programs like DreamIt help validate business assumptions, minimize startup risk and guide businesses to market. With healthcare startups, that process is more complex. Aside from needing to comply with changing regulations, these companies deal with a market that's behind heavy hospital doors -- data is often difficult, if not impossible, to access. DreamIt has addressed these challenges through collaborative partnerships with Penn Medicine, the region's largest provider, and Blue Cross Blue Shield, the largest insurer.

Mentoring for the nascent companies will include time with industry experts who can explain the behind-the-scenes aspects of medical operations. Each company will also receive a a stipend of up to $50,000.
 
"It's about understanding the operational systems and getting access -- potentially to the systems themselves, but also to the experts,” says Karen Griffith Gryga, managing partner at DreamIt. "We provide the payer-provider element as well as access to the operational systems, the data and other resources that are often difficult for these companies to access."
 
Companies also need to navigate conflicting interests between payers and providers. Fortunately, those parties do agree on the need for improved quality of care and tools that enable patient self-management. An app regulating daily nutritional habits, for example, could help individuals treat their diabetes or obesity. The payer and provider also share an interest in big data management systems that can help hospitals treat more people.
 
"Now, more than ever, there is this desire among the different constituents of the healthcare ecosystem to find a way to work together in a much more collaborative fashion," says Griffith Gryga. "Hopefully that will continue."
 
Source: Karen Griffith Gryga, DreamIt Ventures
Writer: Dana Henry

StartUp PHL has announced it's first batch of winners. $6 million will be doled out to promising Philly startups over the next three years. First Round Capital -- recently named StartUp PHL’s seed fund manager; they matched the city's original $3 million output -- will direct the distribution.

Since October when StartUp PHL was first announced, 118 groups applied for a piece of the $500,000 Challenge Fund. The winners were selected based on their potential to increase business operations, create jobs and strengthen existing entrepreneurial networks. According to Luke Butler, chief of staff to the Deputy Mayor for Economic Development, the Nutter administration chose winners that reflect the growing diversity of our economic landscape, with a focus on life sciences, technology, creative economy, education and clean energy.
 
Three of the six winning projects affect students: Ben Franklin Technology Partners of Southeastern Pennsylvania (BFTP-SEP) in partnership with Campus Philly received $25,000 to help local undergrads find internships in BFTP-SEP invested tech firms; PhillyCore Leaders was granted $15,000 to support education entrepreneurs; and Startup Corps earned $20,000 to put towards their high school entrepreneurship program.
 
"Anything that's about the next generation of entrepreneurs is particularly exciting," says Butler. "One of the overall goals we have for this administration is: How do we create the kind of environment where young people see opportunity in Philadelphia?"
 
Other winners included the Enterprise Center's Center for Culinary Enterprises, VentureF0rth and the Greater Philadelphia Chamber of Commerce, which is creating a comprehensive online directory for regional startup resources.  

While the decision isn't final, the Nutter administration plans to repeat the challenge fund.
 
"Not everyone is out there trying to raise money from VCs," says Butler. "Equally important are the organizations that we have in this city that are providing services and support to companies as they grow. We wouldn't be able to do this if the community weren't so strong already."
 
Source: Luke Butler, Chief of Staff to the Deputy Mayor for Economic Development
Writer: Dana Henry

WordPress launched in 1998, creating a world in which even your grandma’s cookie business could maintain a web presence. On February 21, Apprenaissance -- mobile app creators located in Old City -- relaunched as Artisan. Their flagship product is Artisan Optimize, an app builder at the forefront of a WordPress-style revolution in the mobile sphere. 
 
"In the '90s, everyone had to have a website, but they weren't exactly sure why," says Bob Moul, CEO of Artisan. "To some extent we’re seeing that on apps. People are starting to go to the next level and say, 'Hey, this is actually a really cool way I can engage my customers in ways that I couldn’t do with a website.'"
 
Accessibility, however, is still an issue for app writers. Once an app goes to App Store, Apple controls it. A simple change in wording, color or image goes through the builder's IT department, and is then resubmitted to Apple. At least a week goes by before Apple releases the update. The process can often take a month or longer.
 
Artisan Optimize shifts the power dynamic with Mobile Experience Management, a platform that enables point-click style revisions for mobile apps. Artisan’s patent-pending technology allows their cloud to update Apple's system, creating an uninterrupted pathway from app author to the App Store.
 
By eliminating the need for code, Artisan allows non-developers to make changes. A marketing department using Artisan can also observe resulting traffic -- down to the specific actions of individual users -- with Optimize’s Experimental Analytics.
 
The relaunch closed its seed round of fundraising with $3 million from First Mark Capital and angel investors. They are hiring developer, sales and technical writing postions.

Moul said Artisan expected their product to be a hit with mid-level retail corporations but was surprised to find that conglomerates the size of Disney (which owns 600 mobile apps) are expressing interest. Artisan is demonstrating the new product this week at Etail West 2013, a national e-retailers trade show in Palm Springs, California.

Source: Bob Moul, Artisan
Writer: Dana Henry

After receiving a final contribution from the University of Pennsylvania, the University City Science Center closed its Open the Doors Campaign. The first fundraiser in the local institution's fifty year history raised over $1 million for Quorum. This "clubhouse for entrepreneurs" has a two-pronged mission: to provide a place where entrepreneurs can meet and present a programming series designed to help those entrepreneurs move forward.
 
Quorum -- equipped with meeting rooms, a lounge and a small auditorium -- is distinguished from traditional coworking spaces through open accessibility. Local entrepreneurs are encouraged to use the space to host meetings or to just drop by to work among their peers. No membership required.
 
"We really want to give people the chance to make informal connections," says Jeanne Mell, VP of marketing and  communications for the Science Center.
 
The roster of investment and advising opportunities includes Coffee and Capital, an educational meeting between an investor and 20 entrepreneurs; Office Hours, where local business experts -- including Jeff Libson from Pepper Hamilton, Jeff Bodle from Morgan Lewis and Allison Deflorio from Exude -- meet individual entrepreneurs to answer pre-submitted questions; Angel Education, which hosts a panel of entrepreneurs to educate angel investors about opportunities in emerging industries;  and How to Talk to Money, a new series by BizClarity's Steve Bowman on approaching investors.  
 
The concept emerged from recommendations made by Select Greater Philadelphia's CEO Council for Growth. Since opening in 2011, the facility has serviced 12,000 individuals and hosted 250 events. The Science Center has also partnered with the Navy Yard's EEB Hub on Satellite Quorum, to offer programing on energy-related ventures.
 
Open the Doors received support from 34 private companies and institutions, including Morgan Lewis, Children's Hospital of Philadelphia and Energy Plus. Moving forward, the Science Center expects to provide opportunities for ongoing sponsorship.
 
"As the money has rolled in, it's been used to support Quorum's programing," says Mell. "This is really the first step in our fundraising journey."
 
Source: Jeanne Mell, University City Science Center
Writer: Dana Henry

Our partner for the "Inventing the Future" series is the University City Science Center.

Students can make great entrepreneurs, but VenturePact—founded by Penn students Randy Rayess and Pratham Mittal—is proving they can also be wise investors. The emerging firm is releasing its first class of startups.
 
A few months ago, First Round Capital launched student investors with The Dorm Room Fund (featured in a December issue of Flying Kite), entrusting $500,000 worth of capital to undergrads. VenturePact, on the other hand, didn’t begin with major cash. The group invests technical handiwork -- building out the startup’s product -- in exchange for a fee and partial equity.
 
Development can be outsourced, but it’s tough for non-techies to evaluate quality: A product riddled with bugs can still look great on a screen. VenturePact’s "partnership" model changes the incentives.
 
"Now that we have equity stakes, we want to build the best possible businesses," explains Rayess. "We want to keep them and nurture them."
 
VenturePact received over fifty applications at inception, but accepted only three: Accompliss, an app that helps hotels connect with guests; AirCare, a video-based professional coordination app tailored to the healthcare industry; and Boupp, an app that helps the fashion industry consult with customers on emerging trends.
 
The new platforms will be maintained by Penn students, who will receive school credit through VenturePact’s fellowship program. Rayess expects to eventually offer incubation services to startups, connecting them to mentors, publicists and venture capitalists.
 
VenturePact received a significant publicity boost in September 2012, when First Round Capital CEO Josh Kopelman tweeted about them. They’ve since connected with the venture arms of IBM and General Electric, who expressed interest in sending incubated companies their way.

Source: Randy Rayess, VenturePact
Writer: Dana Henry

Philly’s tech community is on the map. Literally. On January 28, Philadelphia Startup Leaders (PSL) and WeWorkInPhilly (WWIP) launched the Philly Community Map and Directory, a GIS-enabled open-source guide to the individuals, companies, coworking spaces, resources, organizations and investors that make up our growing startup economy.  
 
Based on the WWIP directory created by Linus Graybill and Alex Hillman (cofounder of Indy Hall), the resource is intended to be "used by all, owned by none." Its development brought together a team of disparate techie founders including Hillman, Chris Cera of ArcWeb, Brad Oyler of W3Portals, Mel Baiada of BaseCamp Ventures, Brian Kirk of Technically Philly, Elliot Menschik of Venturef0rth and Bob Moul of appRenaissance.
 
"A lot of people are interested in finding better ways to interact with the tech community," says Cera. "[The Community Map] is a minimum viable product we did collaboratively to prove that we can all work together even though we have different goals and different stakeholders."
 
Member listings can include revenue, customers, number of employees and job postings. Cera points out that the project is not solely focused on the commercial aspects of the tech community -- new members can register companies or sign up as people.
 
Moul, who is president of PSL, expects the map will help entrepreneurs, startups and businesses promote themselves, while also making the local tech economy more attractive to inside and outside investment. The Economy League of Greater Philadelphia, Select Greater Philadelphia, PHL Convention & Visitors Bureau, University City Science Center and Startup PHL plan to host the resource on their websites.
 
As of January 28th, 852 people and 328 companies have signed up via WeWorkInPhilly. PSL encourages anyone with a stake in the local tech scene to consider joining.
 
Source: Chris Cera, Bob Moul, Philly Startup Leaders
Writer: Dana Henry

Curalate launched its groundbreaking visual analytics platform in 2011 and began accruing an impressive client base, including The Gap, Michael Kors, Campbell's and Saks Fifth Avenue. Now the University City-based company has broadened its focus to include customer engagement strategy.
 
The investment community has gotten behind the decision. Curalate’s seed round funders—New Enterprise Associates, MentorTech Ventures and First Round Capital—have reinvested $3 million in their Series A. The company has grown from four to 14 employees in the past year and now seeks web developers.
 
Visual analytics, the foundation of Curalate’s subscription plan, enables large companies to track images on platforms like Pinterest, Instagram and Tumblr. "Increasingly, consumers are talking about brands using pictures instead of words," explains founder and CEO Apu Gupta. "We make it possible for brands to understand who’s talking about them, what they’re talking about and what’s important to customers."
 
Graphics, more than text, reveal specifics about consumer preferences. Someone might "like" The Gap on Facebook, but posting a blue sweater explains why. With visual information, businesses can better determine what to include on their homepage, email blasts and billboards, as well as which products to use for social media promotions.
 
"In a social context, [brands] have never known, specifically, which products were driving their engagement," says Gupta. "What brands can do with that is pretty powerful."
 
In September 2012, Curalate launched their "dashboard," allowing clients to manage customer social engagement on visual platforms and administer promotional campaigns. They’ve partnered with several established public relations agencies and helped The Gap effectively promote across nine countries.
 
Source: Apu Gupta, Curalate
Writer: Dana Henry

Think about your favorite bar or coffee shop. Sure, you enjoy the grub, the décor, even the snarky comments from the hipster behind the counter, but none of this would impress without decent music.

Sevenpop—an Israeli startup with U.S. headquarters in Center City—mines our timeless urge for good tunes, integrating mobile requests into a business' preexisting music player. According to cofounder John Vairo, when patrons influence the sound system, they’re more likely to stay—and spend—giving the business a competitive edge.

Recently, the company closed its first round of financing with a $400,000 investment from JanVest. They’re currently releasing the United States version of Sevenpop across the country.

Cofounders Nuke Goldstein and Eyal Bernstein created the product at a bar in Tel Aviv that later became their alpha test site. When the team asked for a computer to run the system, the bar explained their only apparatus was the music player. "We concluded [Sevenpop] should focus on the music and the product was shaped," says Vairo.

The resulting “Social Jukebox” provides a lean solution for three popular multimedia systems. (The company says they will adapt their software for other systems.) They've landed in bars, cafes and DJ booths, and expect to add grocery chains, gyms and sports arenas to their client base. The company sells added social features, but Vairo says the best way to approach a market segment of this size is to keep the basic software free. “Once [the client] is up and running, the system is theirs for as long as they want it," he says.

Source: John Vairo, Sevenpop
Writer: Dana Henry