Everyone who dropped by the Beta.MN 2.5 event earlier this week to meet with 15 promising start-up companies got three small tokens to distribute among jars each firm had on their table.
These were small plastic tokens about the size and weight of a cheap poker chip, gold with a dollar sign on each side. It’s generous to call them worthless. I called mine bitcoins, and I took the task of allocating my worthless bitcoins very seriously.
The companies were selected to present at the official kickoff of Twin Cities Startup Week, a series of workshops, talks and other events each September to support the local entrepreneurial community.
Ryan Broshar, a venture capitalist and one of the leaders behind all of this, said the reason to run what amounted to a popularity contest at Beta.MN 2.5 was to encourage guests to actually go talk to the entrepreneurs.
In any start-up event like this, a key part of the show is the product “demo,” a chance to show a potential investor or customer the new service or gadget. It doesn’t always go that well, as evidenced by what happened to Hidrate, a runner-up in the contest for one of my three bitcoins.
As it turned out, the prototype for its smart water bottle was in the hands of its CEO, and she had been unexpectedly delayed. That left me to examine what appeared to be a long, skinny circuit board, the electronic guts of a smart water bottle, and listen to a story of how Hidrate came to build the best one.
If a smart water bottle sounds like something no one needs, the folks at Hidrate know otherwise. The people most interested are amateur athletes and others who worry they just don’t drink enough water.
A sensor in Hidrate’s water bottle measures what’s been used throughout the day and integrates that information an application on a smartphone that helps a person track other things including exercise. If the water bottle’s owner isn’t drinking enough water, it lights up. There’s probably a solid market niche for that.
It was interesting to hear all the stories of how the entrepreneurs figured out what their chosen market needed.
The founders and staff of Homi saw their opportunity at Carleton College. Their product connects college students to alumni, to get the realistic information and help students need to launch careers. Standing there in their Homi T-shirts, it seemed safe to conclude they think the college itself had failed to meet that need.
Another finalist for one of my bitcoins was Upsie. Its founder had landed on a solution to what’s clearly an acute pain point for many consumers — the price of an extended warranty on things like a TV or phone.
With Upsie, the process starts by downloading an application — of course it does — and then buying a product warranty. A photo of the receipt will do. In the company’s demo, it cost $49.99 for a two-year warranty for an iPhone 6 on Upsie compared to $264 if purchased from Verizon Wireless.
On the other side of the room from Upsie was Vugo. “I just may be biased,” Michael Dillon, a vice president of Vugo, said as he gave his pitch, “but I think we have the coolest start-up here.”
Vugo was formed earlier this year to bring advertising into ride share cars, like in the back of one driven by a Lyft or Uber driver.
By knowing where the passenger wants to go, Vugo’s system can accurately conclude what the intent of the trip is. If it’s to a physical therapy location, maybe an ad for a competing physical therapy practice pops up.
Vugo got my first chip.
The next chip went to a company called Kipsu, which has built a software-based system that lets guests at a hotel easily let management know how it’s going during their stay, not after. It works in retail and health care, too. Guests learn about Kipsu when they check in, and if room service delivers cold coffee, management can promptly hear about that.
CEO and co-founder Christopher Smith had previously been a venture capitalist, spending a lot of time flying from the Twin Cities to the West Coast. Kipsu got its start in part because he was looking for smarter way to do a technology-oriented start-up.
Launching a successful business in the Silicon Valley style usually means “getting funded” by a venture capitalist. By doing that, he said, “we turned them from entrepreneurs into public company managers who spend money.” At Kipsu, he said, “we were funded entirely through our customers.”
Kipsu now has about 300 of those and about $1 million in annual revenue. That was more than enough for me.
My last chip went to Buythechange, founded by local serial entrepreneurs who had grown frustrated with the inability to find good services in their own neighborhoods. They’ve created a neighborhood-by-neighborhood version of Angie’s List, based on the idea that neighbors would do business with neighbors if they knew what each other did.
As well thought-out as these were, none of my three picks ended up among the top three vote-getters. The winner at Beta.MN 2.5 was a three-year-old company called Woodchuck USA.
It’s easy enough to see how Woodchuck could win a popularity contest. Its products on display — wooden iPhone cases, cedar or walnut wood-covered flasks and notebooks and even wooden cuff links — were simply beautiful.
Shelisa Demuth, who works in sales for the company, gave a pitch that quickly got into why it got started: to make high-quality, natural products here at home.
Why didn’t I give it a vote? Because it looked like it can’t be anything but a craft business.
Woodchuck has 14 sketches under “Meet Team Woodchuck” on its website, including the interns and a harmless looking “guard dog” named Angel. It’s impossible to imagine the business at 100 employees.
In fact, looking around at the end of the evening, it was hard to imagine any of the 15 start-ups becoming a company like Medtronic that’s a big driver of economic vitality in our region.
But even if they don’t do that, they are still having the time of their lives.