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With the MIT $100K Entrepreneurship Competition over, it’s time to handicap the real winners, the companies that will make it in the long run. Winning the $100K business plan competition isn’t always the best predictor of success. Myomo Inc. -- winner of the then-$50k in 2004 -- recently reduced staff by two-thirds after reporting sliding sales of its robotic device intended to help stroke victims improve arm movements.
Notable $100K losers since 1995 include companies you may have heard of -- Harmonix Music Systems Inc., maker of Guitar Hero; Akamai Technologies Inc., which found a home on the Internet’s backbone; and Terrafugia Inc., maker of a flying car. Harmonix was bought by Viacom Inc. for $175 million in 2006, Akamai went public in 1999, and Terrafugia attracted plenty of attention when it test flew its Transition roadable aircraft in March.
We’ve asked a panel of experts — Shawn Broderick, executive director of TechStars Boston; Brian Del Vecchio, co-founder of BetaHouse; Sunil Dhaliwal, general partner at Battery Ventures; Jean Hammond, principal of JPH Associates; and Dan Phillips, entrepreneur-in-residence at the University of Massachusetts Boston — to handicap the semifinalists on their business prospects. The process was thoroughly unscientific, and the reactions of the panel are off-the-cuff.
Grand Prize Winner
KSplice
$100K grand prize winner Ksplice’s technology lets users update their computers without rebooting.
Average grade: Cash cow
Broderick: These guys could definitely ease some pain.
Del Vecchio: I’m not sure how disruptive it is to fix inconveniences in someone else’s operating system, but I do know that there is a lot of time wasted in the IT world waiting for reboots.
Dhaliwal: Solving the ever-annoying problem of cumbersome software updates. If their solution works easily across the spectrum of operating systems and applications, you’ll see this technology everywhere.
Phillips: I love Ksplice. It is a simple value proposition with very clear value. However, what I would like to see in any business plan, even in a summary format, is the proposed cost to build the product/service, the proposed price to the customer, and the market size. It seems a lot easier to raise money from a university than from a VC firm.
Track winner
Cambridge EyeNovations
The life sciences track winner has developed a contact lens-based drug delivery system.
Average grade: Steady business
Hammond: Could be a good investment, exit possible.
DelVecchio: For years I’ve been wishing for caffeinated eye drops, and this team seems very close. I’m a bit skeptical that medication and contact lenses are compatible — coffee stings a lot more when you’re wearing contacts. Take my word for it. But there has to be some home run out there for this drug delivery mechanism — some ocular equivalent to teeth whitening or E.D. medication.
Overall Category
Development track
For-profit or non-profit startups aimed at people earning less than about $4 a day in other countries, or below the poverty line in the United States: This category emphasizes social consciousness and produced last year’s winner — Diagnostics For All, which developed a simple, portable, low-cost tool to diagnose liver, kidney and metabolic diseases — and provoked very different reactions from two of our judges.
Collective average grade: Steady business
Del Vecchio: This category is filled with Pipe Dreams by definition. These devices may have an impact on rural populations in the developing world, but personally, I lack the business expertise in this field to begin to understand how you’d make one of these into a sustainable business.
Dhaliwal: Love (One Earth Design’s) idea. A simple solution to help bring heat and energy to the world’s rural poor. The best of what entrepreneurship can hope to achieve.
Phillips: Two socially conscious initiatives I really appreciated were Global Cycle Solutions and Sustainable Health Enterprises. Both plans provided obvious benefits to Third World countries and they just felt like there was a market and you could make money. What a wonderful thing. Social consciousness and making money.
InstantQ
This semifinalist from the products and services track is in the business of “queueing solutions.” InstantQ has developed a mobile-phone based service intended to prevent users from having to wait in line.
Average grade: Long shot
Broderick: Definitely a ‘duh’ company — as in, ‘Duh, why the f*&@ hasn’t somebody done this already?’ Good guys with a damn useful product.
Del Vecchio: If these people are hoping to replace the blinking coasters handed out by hostesses at TGI Fridays across the country — then what will we use to play Hot Potato with while we wait for our meals?
Hammond: Not enough economic return.
Graphite Power
The products and services track semifinalist has developed what it calls “electrofoam,” a moldable solid material that can store energy, act as a battery and be recharged in seconds.
Average grade: Cash Cow
Broderick: Wow ... if they could really deliver on this ... wow.
Del Vecchio: I love the idea of electrofoam almost as much as I hate batteries.
Hammond: Could be huge — science project first.
NovoPhage
Life sciences track runner-up NovoPhage has developed a biological therapy to increase the efficiency of antibiotics.
Average grade: Cash cow
Del Vecchio: Having no background in biology, I have to rate these entrants by skeeve factor. And terms like “engineered bacteriophages” are scarier than a Wes Craven film trailer. Skeeve factor: 5
NetVirta
Using computer vision tech, this web/IT track runner-up allows users to make 3-D models of their bodies to try on clothes before they buy them online.
Average grade: Long shot
Broderick: Very cool idea — but implementation is wildly non-trivial. They’ll have to nail it hard to bump up into a real bucket. Who pays for this?
Del Vecchio: I could spend hours building a precise 3-D model of my body so I can shop for clothes online. Isn’t that what Second Life is for?
Hammond: Lots more to do ... could be very hot.
FenSiZu Fan Club
This web/IT runner-up has developed a membership-based aggregator of the fan clubs of Chinese celebrities. The site’s features include video interactivity between the celebrities and their fans.
Average Grade: Steady business
Del Vecchio: I recently followed Eliza Dushku on Twitter (@ElizaPatricia) as she posted pictures of Africa from her cell phone. What makes the experience so cool was its spontaneous, unmediated nature. Celebrities and fans alike crave authenticity, not an aggregation infrastructure.
Dhaliwal: A billion celebrity-obsessed Chinese can’t be wrong. They have MC Hammer as an adviser. Can’t miss.
Nexiwave
This semifinalist’s voice recognition tech allows users to search conversations, conference calls and voice notes.
Average Grade: Steady business
Broderick: Crowded space.
Dhaliwal: Speech recognition has been the ‘next big thing’ for years. Don’t look now, but it’s actually happening. A productivity application like Nexiwave has lots of potential.
Dinube
This mobile track runner-up has developed a cloud-based transaction platform intended as a substitute for banking in Mexico, where the population is underserved by banks, according to the startup.
Average grade: Cash cow
Broderick: Potentially the future currency of the developing world.
Del Vecchio: The fact that we still see an array of long distance calling cards for sale at every bodega and convenience store in Cambridge is an indication of the huge global demand for alternative banking and payment systems. I don’t fully understand Dinube’s approach, but the market is undeniably huge.
Hammond: A good return can be made here — the investor needs tolerance of international risk.
Viral Optics
This semifinalist from the life sciences track came out of the MIT Microphotonics Center. It’s developing a handheld device that could detect prostate cancer from a single drop of blood.
Average grade: Cash cow
Del Vecchio: If the point of biosensing is to increase the throughput of medical diagnosis and research, then it can clearly be used to improve health care on a grand scale. But it also reminds me of the scanners used in the evacuation scenes from the 2008 zombie film ‘I Am Legend.’ Scary implications in the Year of the Swine. Skeeve factor: 4
Dhaliwal: Point-of-care disease screening is a huge market opportunity. As they lower the cost of their hardware and add screening for other diseases, it could have broad adoption.
Categories & Grades
Development
| Global Cycle Solutions | Steady business |
| MobaSola | Steady business |
| One Earth Designs | Steady business |
| Sustainable Health Enterprises | Steady business |
| WaveWater | Steady business |
Life Sciences
| Cambridge EyeNovations | Steady business |
| Novophage | Cash cow |
| PainMD | Steady business |
| RefleXion Medical | Steady business |
| Viral Optics | Cash cow |
Mobile
| Dinube | Cash cow |
| Hammock | Steady business |
| InstantQ | Long shot |
| MeterLive | Long shot |
| Social Sense Labs | Long shot |
Products and Services
| Authors Globe | Steady business |
| Graphite Power | Cash cow |
| Mimix | Long shot |
| Simprint Nanotech | Steady business |
| YouTea | Long shot |
Web/IT
| FenSiZu | Steady business |
| KSplice | Cash cow |
| NetVirta | Long shot |
| Nexiwave | Steady business |
| VigLink | Long shot |
Judges
Shawn Broderick
Executive director, TechStars
Brian Del Vecchio
Founder, BetaHouse
Sunil Dhaliwal
General partner, Battery Ventures
Jean Hammond
Principal, JPH Associates
Dan Phillips
Entrepreneur-in-residence, UMass Boston
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