Warming up for the first pitch
Startups have to master the art of the pitch before they get anywhere with fundraising, or even explain to their parents what they do.
That's why Portland State University recently hosted Pitch for Beer. This informal pitch session was baited with a tub of cold beers and a stack of Hot Lips pizzas.
Some of the participants were familiar. They are already using the $300 per month desks in the Portland State Business Accelerator in the same building near the Ross Island Bridge. Others were just along out of curiosity and moral support.
Angela Jackson of the Portland Seed Fund and managing director of the all-women Portfolia venture fund introduced the participants and laid out the rules. Pitch for three minutes and discuss for two. Don't focus so much on the product as the business model.
The event is considered a warm up for the Bend Venture Conference, which is bigger than anything held in Portland when it comes to participation.
Shake it up
Viswanath Parameshwaran Kashi and his partner Taqi Sleel were there representing their app Phoneshake. It's an easy way for exchanging contact information between phones. Users with the mobile app simply shake one phone at another. The phone detectsit and activates the app to transfer contact details with LinkedIn, Skype and other ways to connect. Users can create a QR code with their contact information. Those without the app can pull up the web version and gather the information by scanning the QR code.
Users can be directed to the person's LinkedIn page, which has become the default place for business contacts.
"We are building this for millennials and Gen Z professionals, where they don't have to use anything, or manage these business cards, or scribble down numbers," Kashi said. "You just have to shake the phone, and they have to accept or deny, literally mimicking the experience of exchanging business cards," he added.
A team of five from a previous startup wrote the code. Pitching the technology is as easy as a handshake, but making the business case is more like a complicated high five.
Sleel said that phone technology is good enough for this basic function, and has been for a while. Adoption is everything. "We're also looking at licensing deals by franchising, we are in talks with some tech companies," Sleel said.
He would not say who those companies are but the exit would probably be by acquisition. On paper it sounds attractive: LinkedIn has about 600 million users.
They want to add to the next version the ability to import contacts directly into Customer Relationship Management software, for even quicker connections. A salesperson could meet a lead and have an open channel to them within seconds, by phone, text, email or even video chat. The possibilities, according to Kashi and Sleel, are huge — real estate agents using it to network and manage clients, or people meeting at a meetup or coffee shop.
Mirco Fiaschi's app Letzdoit is designed to find activity partners in the mobile age. More spontaneous than Meetup, which requires registration, Fiaschi said Letzdoit is for people who want to find a pickup game of soccer or go for a hike without a lot of organizing.
"It's about connecting people to do what they love with other people in real life. We want to use technology to bring people away from entrepreneur," he said. He's banking on the fact that after prolonged periods at a screen, humans crave technology-free, face-to- face meetings — even with complete strangers.
Right now there are not many activities on the app for Portland. It needs more listings and more people, and relies on the Eventbrite calendar. To scale they are going corporate.
"Now we are trying to understand how we can scale this business and we decided that it could be going to corporations like Nike."
In his 10 years working in supply chain and process improvement at Nike in Amsterdam and Beaverton, Fiaschi spent a lot of time linking people up to play sports. There were so many arrivals in new countries who didn't know anyone but had passions.
"But every connection was through email. It was tough to organize games and tough to get visibility to those games," he said. He saw a gap in the app market for bringing them together, quit Nike and went full-time entrepreneur.
In a corporation members could see all events available at any one time, saving time for organizers.
"Every time one employee wants to do something, they have access even when they travel to other offices," Fiaschi said. "And And we know Nike is a global brand. They have offices everywhere and they struggle in connecting their employees." As a B2B company, the app would be restricted to staff with that company's email address.
Ten years ago, there was an app called Foursquare, which let people check in at a bar, mall or event, to show their friends. His app is about intention, people looking for activity partners, not places.
"If you have something in common with someone else, a passion, that it helps you get out of your comfort zone and go meet that person. That, and trust."
Technology has not been very good at establishing trust. Now it's easier. Mobile apps such as Lyft help people trust their driver because of their updated reputation and rating. Now this is possible between friends.
Fiaschi and his cofounder the chief technology officer have not raised any money yet, they are self-funding. "My wife is the one who makes the money right now."
The end of 2019 is their deadline for raising money. Otherwise he will go back to corporate, probably Nike, and save up again.
Angela Jackson and Jim Houston, co-directors of the Portland Seed Fund, made the introductions. PSF is a privately managed fund and non-resident accelerator focused on providing emerging companies the capital, mentoring and connections to propel them to the next level.
It provides connections for students, and offers them mentors — people who know the ropes and can offer solid advice.
They were in attendance from companies such as Toolbelt Software, Goodwell + Co the toothbrush maker and Megh Computing. Goodwell is noted for raising money and winning competitions, while PK Gupta, the founder of Megh Computing, is a single-name "rock star" in town.
Gupta was there to listen and give feedback rather than judge. Megh provides software that runs on special hardware (chips). Megh uses hardware accelerators to accelerate real time analytics for enterprises in the cloud. His company started in one of the seats downstairs. "It was $250 then, not $300. We outgrew it pretty fast and moved."
When he listens to a pitch he's looking for three things. First is the problem statement.
"What is the problem they're solving? What is opportunity?" asks Gupta.
Second is the solution. "The second thing that should be articulated very clearly is what is the solution? How can they solve that with what they have?"
His third key pointer: The team. "It is critical who the team members are, what do they bring to the table and how they're going to bring it to market"
These were just quickie pitches, but if they were coming back to pitch investors they would bring the whole team.
There were people in the room in cut-off jeans, thrift store T-shirts and rumpled khakis. Gupta has no interest in looking at clothing.
"We look to make sure that they are fully passionate, confident and believe in what they are doing. You don't have to be perfect. It's just in general, when somebody's talking with confidence, and talking with belief, strong belief, you get that you feel it right away."
He can sense their feeling and authenticity. "They need to be very passionate about what they're talking about, because this is a journey they have to go on, mostly alone, or maybe with some teammates."
Mathematician Joseph Ruskiewiz was there for Stack. This is software that when it's launched, will rate how well software engineers are doing. It reads through code, figures out who did the best work and gives them a numerical rating. It's called static analysis, formal methods.
"We introduce authenticity and alignment between engineering leaders and engineers," he said. "Our tool creates a mathematical model of the source code, and it starts to ask questions, like, 'Did they use good patterns? Could this code crash?' We analyze the artifacts of the software engineering process, including source code, build results, test results, and things like this. And we measure the quality of these different artifacts, and we measure who contributed to those artifacts. And so we're able to determine who's doing a good job or not a good job." He says software industry is very subjective. People get promoted for things nothing to do with performance.
"Like the guy who smokes cigars with his boss every Tuesday night. I know this situation. It's one of the highest-rated guys. He's terrible, but he goes with it. He's still highly ranked. And everyone knows it's a farce."
He said junior engineers are burning out after two or three years because the system is unfair.
"They see people who've been there for 20 years that aren't doing a very good job, but they've just been there for 20 years. You can ask, 'When can I be promoted?' (With Stack) now the manager can say, 'Hey, when you hit this value or this data point and an engineering process, then we can start to talk about promotion.'"
For engineers, a Level 25's salary range might be $76,000 to $120,000. A level 27's range might be $180,000 to $240,000. People know when they are in the wrong bracket. Software could help fix that.
"It costs over $45,000 to replace an engineer. Through our tool, you can determine when they're about to quit. What happens is, about two months before people quit, they start caring a little less. Their performance goes down."
He said it will cure all kinds of inequities at work.
"Oregon's the third state to change the law — California, Washington already have — to where corporations are required to show that for equal positions and equal performance there's approximately equal salary. Essentially, it's saying, look, we'll reward you as a company, if you can show equality. The beautiful part of the tech world is, there is a push to do this, even though you hear the stories, there still is a big push to solve this problem."
Stack should be ready in two months.
Kevin Gillespie and Katia Alcantar were pitching Text A Lawyer. He sees it as solving two problems: "First, much of working-class America doesn't have an easy and affordable starting place to handle their everyday legal issues. Second, for small firm lawyers, they find that lead generation is both time consuming and very expensive."
He says over 600,000 small firm lawyers need leads, and 77 million Americans each year have a legal problem handled without any legal advice.
Drunk driving, eviction, divorce….They have 13 categories they eventually plan to launch, but right now the big areas are landlord-tenant, personal injury, family including everything from child custody to divorce, cannabis, employment and civil rights.
"Our competition is scarce, Legal Zoom and Rocket Lawyer handle mostly legal forms. Just Answer offers on demand legal advice, but it comes with a huge disclaimer. It's not legal advice the lawyers from another state and they post your private legal matter on their website publicly for all the see your name. The other competition is 39 flavors of scamming legal insurance like Legal Shield…"
On Text A Lawyer you can ask a question to a local online lawyer for $21. You then enter in instant message chat with no timeline.
"Once your lawyer learns enough to answer your question, they submit your final answer. The final answer triggers a three-minute clock for the client to read the answer and decide whether they want to ask an $11 follow up question or exit to the rating screen and have a whole transcript via email. We earn $10 on the initial question, $5 on each follow up question and charge lawyers $100 monthly access fee as a subscription."
There's a 90-day demo period free for lawyers.
He and Alcantar, who moved here from Houston for the startup, also have a part time CTO and CMO who both have relevant experience. They also have a couple of high-level advisors and two strong strategic partners.
"We're currently training half dozen lawyers for landlord-tenant and expect a launch later this year or early next year. Our go-to market includes a detailed Facebook advertising campaign. And we've done door hanger flyers to create demand that my co-founder and I are going to pass out ourselves in areas in southeast Portland. We've raised $50,000 and seek $450,000 additional funds to help us saturate Portland with Text A Lawyer."
They're also launching a Spanish language version, especially for immigration issues in South Central America, and a calendar for texting people about their court appointments. According to Gillespie, missed appointments cost the courts millions of dollars every year.
It's a good service idea, and Gillespie's pitch quickly included the business model and the team. And it has something rare in the tech startup world: It aims to help the poor. Gillespie was a public defender, briefly, in San Francisco, but couldn't stand it. He was spread so thin he felt he wasn't doing any good. This, he believes, will help average people get off on the right foot in the legal system.
"We're legal first aid. Right now, you go from zero to high level surgery now. We're saying, hey, let's add some legal first aid, let's make it fast and slick and cheap. Let's not have any hidden fees. And that creates a huge market for lawyers to want to get on our platform."
Reporter, The Business Tribune
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