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Innovation & Job News

PhilaDev's Musemaka hopes to spawn frictionless startups with $5,000 contest

If you've got an idea for a frictionless startup, then you have a shot at winning $5,000, no strings attached.

Philadev Ventures, the startup accelerator, has just launched Musemaka.com. A maximum of 200 entrants vie for one slot, paying a $100 entry fee. The winner gets a $5,000 budget to create a company. "We hold a challenge open until it has 200 entrants or for a period of three months, whichever comes first," says Philadev co-founder Chris Myers. "During a three-month period, we could fill one challenge or five. Whatever the number, winners are announced 30 days after a particular challenge closes."

Phil Ives, who co-founded Philadev with Myers, defines a frictionless startup as any business idea that costs little or nothing to start. Take the example of a blog. "If you are the writer, and you act as editor, it costs no money to start," says Ives. "Another example is a startup that begins with the design of a physical widget which can be outsourced to China, and requires a three to four thousand dollar initial investment to start selling products."

Philadev has been in business for one year, and Ives says of the six initial companies under its wings, two are about to launch publicly, although he cannot divulge details just yet.

"We have a couple of startups in our accelerator that would be better for this," says Ives of the inspiration for Musemaka. "For us as Philadev, if they don't raise venture or sell their idea, we can never see revenue."

Philadev will not take equity from Musemaka companies, but Ives is open to a future equity relationship. "It's a way for us to discover new startups," he says.

Ives is greatly influenced by the work of Tim Ferriss, whose bestselling book outlines the concept of the Four Hour Work Week. Ferriss defines a muse as an idea that can be tested for under $500, automated within 4 weeks and maintained within a maximum of one hour per week.

"The rolling nature of the application process is important because it helps to address the startup discovery problem I identify on the site regarding Y Combinator.," says Myers. "That's the most extreme example, but it is really difficult to imagine  how any venture group that employs business judgment to evaluate submissions is capable of handling 520,000 submissions a year, as Y Combinator does.

"The result is probably lots of good startups left out of the running. Their application numbers to class size gives startups something along the order of a 1 in 5,000 chance," adds Myers, who also indicates that an applicant has a better chance of getting into Harvard than Y Combinator. 

Says Ives: "This contest addresses a big piece missing from existing small business development organizations. Those places seem really good at helping people open up a physical retail space, but they haven't really cracked the nut on software as a service."

Money, he adds, is never the reason a business doesn't get built. And a big part of the Musemaka package is sage advice from Philadev, including when to call in the high priced lawyers, and when to start small and build.

Ives and Myers have just begun the process of getting the word out about Musemaka, and expect applications to start rolling in within the next month or so.

Source: Phil Ives, Chris Myers, Musemaka
Writer: Sue Spolan
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