Capital Factory Demo Day: Five Startups on Display
Last April, Capital Factory solicited business proposals from entrepreneurs. They hoped for 100; they received more than twice that. On May 22 they selected five teams and gave them a modest amount of cash and access to 20 experienced mentors. The five companies, many with only an idea and name, had 10 weeks to refine their business plans. On Wednesday, the teams gave a brief pitch to around 250 investors, engineers and the general public at the AT&T Executive Conference Center on the UT campus.
Kristen Carney of Cubit Planning presented a web-based software product that reduces the time to prepare environment impact documents. Currently engineering firms generate NEPA documents using various web-based data sources and manually format charts and boilerplate text. Cubit software will automate that process.
Q Beck, Matthew Sullivan and Shirley Cohen, co-founders of Famigo, want to change the way families interact at home. Rather than the current electronic entertainment islands (Xbox, iPhone and laptops), they want to create networked games that the family can play together. They are selling a game development API and individual games.
Hourville demoed an on-line booking service targeted at small service businesses and freelancers who primarily sell a service to the public. Craig McDonald, Fadi Gabra, Matthew Trudeau, and Nick Van Loan met at UT.
PetsMD wants to be the internet source for pet health information. Tina Cannon told the audience they are targeting owners (pet health information, supplies) and veterinarians (scheduling and referrals). Outside the conference room, they had a well-stocked table of stuff they sell.
A California start-up that recently relocated to Austin, SpareFoot, started from the problem of a college student, Chuck Gordon, wanting to find a place to temporarily store his stuff. He envisioned an eBay-like service that allowed person-to-person connections (his furniture spent the summer in someone’s garage). Capital Factory pushed them to explore the fragmented self-storage market. They now have a website that allows individuals to find and price compare storage local options. SpareFoot recently completed some Series A financing from Silverton Partners.
Among the attendees was Ava Richter from the Austin Economic Growth and Redevelopment Office.
“I try to retain and recruit technology companies,” Richter said. “Right now most of my calls are either for companies looking for money or engineers looking for work.”
I sat down with Capital Factory Managing Director Bryan Menell afterward to chat about how the day went.
Thinman: What stage are these companies?
Menell: Various flavors of early stage. Famigo was the earliest; they had nothing. Hourville had presented at SXSW accelerator before, and also the Rice Alliance. But they had not hit that inflection point where they'd taken off. SpareFoot was just focused on the person-to-person model. One of the biggest criteria that we look at is who is going to take the advice. Every start-up has the vision of where they're going and they always take a turn. Usually it's the customer making them change direction. We try to help them bypass the steps along the way and take them straight to the thing that will make money.
Thinman: What kind of companies do you consider?
Menell: If we see a company and we think they have a market and we can help, we go for it. But we want to find companies that have lightweight business models. So someone that we think is going to need multiple rounds of VC funding is probably not a fit for us. A better fit is something that does not require a lot of capital to get to mild profitability.
Thinman: How do you think today went?
Menell: Capital Factory is itself a start-up; we had no processes, no set of way of doing things. We had to create infrastructure on the fly; we created a lot of it just in time, but as long as the companies had an office, wi-fi, and power and they're all together, we felt things could move forward.
These companies were giving their elevator speeches three or four times a day. We taped some of the early versions. They got shorter and more focused; you figure out what resonates. When you tell the story yourself, it makes you refine in your mind what it is that you're about.
