Startup Pitch Event September 26th, 2017

As my regular readers know, I frequently serve as a panelist in pitch events. Recently, I decided to start writing about the startups from each event that caught my attention. As someone who has been on both sides of the stage- previously as a founder seeking capital, and now as an investor listening to the visions of the next wave of entrepreneurs- I want to share my learnings. This is why I am including my thoughts on the potential challenges of the startups. My intention is to acknowledge their hard work by providing useful feedback and advice. Ultimately, this all ties into the mission of my company, Closeloop Technologies, where we support founders on their entrepreneurial journey by offering technology strategy, product development, and software manufacturing. You can view some of our case studies here.

GENM

First to pitch was Moe Abbas, founder of GenM. This is an Edtech company, as well as a marketplace to connect students to businesses that offer marketing internships. The founder’s vision is that “businesses will train the workers of the future.” This certainly is a great idea and there’s a market for it: many college graduates lack vital technical marketing knowledge and each semester there will be an influx of new users seeking internships. I believe Abbas can potentially make a lot of money with GenM. However, a good business is not the same as an investible business. My concern is that the company lacks a metaphorical moat of protection from competitors in the market. It lacks a unique proposition. What compels students and businesses to choose GenM over similar companies? In addition, what is to stop the well-established Edtech companies from expanding their services into an internship matching platform, and how will GenM compete then?

BUNKERHOUSE

Next, I listened to Bunkerhouse, a start-up from a South Korean incubator. This is a shared housing platform that connects pre-screened tenants to homeowners looking to rent out individual rooms. The founder takes a hands-on approach to his business: he personally interviews candidates and performs background checks. Thus far, he has signed leases with 200 renters in China and South Korea. I commend the founder for coming to pitch with a working proof of concept. It certainly helps in establishing credibility with potential investors. However, I do foresee a challenge when it comes to scaling the business. Due to the active involvement of the founder, this resembles a property management service. A huge aspect of what enabled sharing platforms such as Airbnb or Uber to grow rapidly is the technology that freed the founder from performing administrative tasks, like updating listings and running background checks.

CITYSTASH

The following pitch of interest was by CityStash. This company offers a unique take on personal storage: it partners with local businesses to help them monetize on unused space, and companies such as Doordash to deliver possessions to and from secure locations. The revenue model consists of charging between four to ten dollars per box each month, plus additional fees for deliveries. What appeals to me about this idea, is that it’s close in model to existing businesses, while at the same time it brings something unique to the table. Considering that his business had already seen success in DC, I’ll be interested to see how it grows locally. I wish the founder the best of luck with his upcoming launch into the SF market.

Take a look at our case study for solar panel startup Omnidian here.

WEADWE

At a time where digital privacy and the collection of consumer data are hot topics, WeAdWe is likely to be controversial when it launches next year in the Mission District of San Francisco. Its intent is to help local small businesses advertise to potential customers who are within walking distance, by showing deals directly on the lock screen of their smartphones. In addition, the founder plans to scrape information from users’ text messages to learn more about their interests. This idea will be incredibly difficult to launch and then to scale. The founder will first need to convince businesses to pay to advertise with this new technology. Many of this neighborhood’s small businesses’ web presence is limited to a Yelp page, which gives some indication on their eagerness to adopt high-tech. In addition, the founder has to persuade users to download the app, grant the app access to text messages, and then to enable geolocation and pop-up notifications. Needless to say, I’m not a fan of the business model.

SUSTAINABLE NOW

Last, but definitely not least, Nathan Morrison pitched his biotech start-up: Sustainable Now. The working prototype is designed to capture carbon in the air and convert it into a fertilizer-like material. His company already has several customers lined up in the United Kingdom, including the University of Greenwich. For many companies, it is cheaper to invest in carbon-capturing technology than to pay carbon fees. What’s the second-best technology? Currently, Morrison claims, there is no second-best available, just trees- and even then, his technology outperforms: just one unit has the same air-cleaning effect as 35 fully grown trees. What an ideal place and time to launch his product: rapidly-growing demand and no competitors in the market.

That’s all for today- of the several pitches, these were the noteworthy companies. If one of the pitching founders is reading this, please take it in spirit. Like I stated earlier, I write so as to offer guidance, not to dissuade entrepreneurs from pursuing their visions. If you would like to partner with Closeloop Technologies, feel free to contact me at info@closeloop.com. As always, my aim is to help startups actualize their ambitions through the resources of Closeloop Technologies.