Looking for the next tech star

Program matches bright ideas with mentors, investors

By Jeff Smith, Rocky Mountain News (Contact)

Published June 9, 2008 at midnight

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Photo by LINDA MCCONNELL / Linda McConnell © Special To The Rocky

Foodzie founders Rob LaFave, left, Emily Olson and Nik Bauman get close to their customer's product at Seth Ellis Chocolatier's plant in Boulder. Foodzie aims to help small food vendors market and sell their products.

Photo by Silvia Razgova © Special to the Rocky

EventVue Rob Johnson, right, and Josh Fraser started EventVue, a social networking site that helps people attending conferences get to know one another.

Photo by LINDA MCCONNELL / Linda McConnell © Special To The Rocky

Brightkite Martin May, CEO and co-founder, and Brady Becker, co-founder, in the office of Denver-based Brightkite, an Internet networking site that allows members to post pictures and descriptions of what's going on at their locations and meet up with friends or new people.

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Up to $15,000 in seed money, along with free office space in downtown Boulder - foosball, pingpong and video games included.

Seasoned technology executives from around the country to offer advice on how to turn a promising idea into a successful business.

Those are the ingredients of a summerlong mentoring program called TechStars, founded by Colorado venture capitalists David Cohen, Brad Feld, Jared Polis and David Brown.

The startup incubator is patterned after a similar effort called Y-Combinator, which has a summer program in Cambridge, Mass., and a winter one in Mountain View, Calif.

"For us, (the motivation) is largely about improving the (technology) ecosystem in Colorado as well as finding interesting investments," said Cohen, TechStars executive director.

TechStars takes a 5 percent equity stake in the businesses accepted into the program, which kicked off last year.

Ten groups recently started the second program. They were selected from 400 applications. Formal business plans weren't required. In fact, they weren't read.

"It's too long of a document," Cohen said. "We're really looking for teams that are great, that have passion and an idea that makes sense."

The groups selected focus on building prototypes and learning from some of the best in the business. The culmination is Investor Day in August - when teams have 12 minutes to make their pitch to some pretty prominent investors.

Even though money isn't flowing as it did during the dot-com days, the inaugural group last year fared pretty well.

Seven eventually garnered funding ranging from $250,000 to $1 million. Nine are still in business. And while only two groups initially came from in-state, six now call Colorado their home.

Most ideas are Internet-related. Several last year were of the social networking ilk, even though that field is crowded with hundreds of competitors.

"A program like TechStars appeals to a younger demographic and . . . that's what's popular today," Cohen explained, adding that social networking is "hot right now with investors. In the end, that's who's picking the companies."

All the participants last year were male. Cohen said TechStars tried hard to remedy that this year. This year, five females and 20 males are among the 10 groups accepted into the program.

"It's just the way it is," Cohen said. "Women don't start IT companies as much as men do."

Dave O'Brien, CEO of The Business Catapult, which aspires to be the eHarmony.com of the business world by matching entrepreneurs with investors, said he's impressed with TechStars' "razor- sharp focus," and its value on partnerships, expert coaching, self- learning and results.

He said it also strengthens the Front Range as a hub of entrepreneurial and investment activity, with economic development implications.

The question, he said, is what to do with promising local entrepreneurs who can't make the TechStars cut, or with TechStars participants who can't bring their business up to speed in 90 days.

The Rocky set out to profile three groups of young tech entrepreneurs to see what kinds of ideas are being formed into businesses. Two were graduates of last year's TechStars program; a third is in this year's program.

EventVue helps conferees get to know one another

As Clemson University roommates, Rob Johnson and Josh Fraser dreamed of starting an Internet venture together.

Before graduating, Fraser, a computer science major, helped create a social-networking feature for a conference in South Carolina. Participants could create online profiles, then arrange to meet people with common interests.

When Fraser and Johnson saw conference attendees walking around with profile printouts in hand, they thought, 'Wow, this would be really valuable to conferences everywhere,' " Johnson said.

Today, the two 24-year-olds are co-founders of EventVue, a Boulder-based social networking application for conferences.

Soon after the South Carolina experience, they applied and were accepted to TechStars. They received a commitment of $250,000 from private investors within two days of Investor Day. They occupy modest offices at the back of Lolita's Market on Pearl Street in downtown Boulder.

Johnson and Fraser keep adding features to the software, but it is well-developed enough to have been used at about 15 conferences to date. Johnson said EventVue typically charges $4 per attendee. Its largest event to date was the National Biodiesel Conference in February, which drew about 4,000 participants.

Conference attendees sign in and are asked to provide a short bio, a short description of what they are looking for, and a summary of skills. Participants also are asked to come up with "tags" to help identify their interests. For example, Johnson might put "Clemson," "Boulder," and "computer engineer."

Attendees can look at the online profiles and contact people of interest via a private online messaging system. Online profiles can be sorted by the tags.

Competition includes CrowdVine and a more generic application called Ning, co-founded by Netscape's Mark Andreessen.

Johnson said one of EventVue's distinguishing features is that it's integrated with two leading online registration companies: EventBright and Boulder-based Regonline.

They also encourage conference participants to upload photos of themselves and are testing short introductory videos. EventVue is working on a feature enabling participants to have online conversations while watching a conference panel.

Although it's unclear how successful the venture ultimately will be, EventVue is generating revenue, recently hired a sales director, and has found a niche among "green" conferences such as the Ecocity World Summit in San Francisco.

Johnson and Fraser often work until 1 or 2 in the morning and acknowledge the business can be emotionally taxing.

"We'll have a great day when everything is falling into place," Fraser says, "and the next day we'll have a server crash."

Brightkite connects people on the move

Denver-based Brightkite is a social networking site for people on the move.

Members "check in" by sending a short text message on their cell phone, or going on the Internet.

The idea is for members to post pictures and short descriptions of what's going on at their locations, and meet up with friends. Brightkite also is designed to serve as an ice breaker.

"You can browse the profiles (of members at the same location) and say, 'Oh, that person looks interesting' and then you can direct-message (them)," said Martin May, the 29-year-old co-founder and chief executive officer.

"It lets you take online profiles into the real world," adds Brady Becker, 30, co-founder.

The two worked at Local Matters, an Internet search software company but quit their jobs after being accepted to the TechStars program last year.

Brightkite members decide when they want their location to be "broadcast" to others. They also can select different privacy settings, including one where only good friends are notified.

"Other services use GPS and track you at all times," May said.

Brightkite is in Beta, meaning it's being tested by invitation only. But word has traveled quickly, and Brightkite has received publicity from a number of prominent Internet sites including Wired.com.

"We're trying to control how fast it grows so we can iron out the bugs," Becker said.

Other location-based social networking sites include Google's Dodgeball and Yahoo's Fire Eagle.

Brightkite is promising enough that it recently received $1 million of funding from private investors. That enabled the company to open an office near Coors Field.

May said Brightkite hopes to make money in part through location-based advertising. For example, an Italian restaurant might text message a Brightkite member nearby with a special offer. Brightkite would be paid by merchants trying to reach potential customers.

O'Brien of Business Catapult and a former entrepreneur-in-residence at the University of Colorado's Bard Center for Entrepreneurship, believes Brightkite offers a strong "value proposition."

"It's the power of place and the power of now, that's what I like about Brightkite," O'Brien said. The challenge, he said: to get advertisers and to convert ads to consumer sales.

Foodzie.com gets small food producers noticed

Emily Olson went to Virginia Tech with plans to become a chemical engineer.

"But most of the days I was avoiding homework to do cooking," the 24-year-old recalls.

Olson wrote a food column for the student newspaper, switched her major to communications and wound up handling private label brands at the upscale gourmet grocery store Fresh Market in Greensboro, N.C.

She learned there and by traveling to food trade shows around the country that many gourmet or "artisan" food producers struggle to get their products into stores.

Olson hopes to change that with Foodzie.com, an Internet site designed to help small food producers market and sell their products.

"I just felt like there's way too many little vendors out there with amazing products, but no one ever finds out about them," Olson said.

Co-founders include Rob LaFave, who has a business and sales background, and Nik Bauman, a computer science expert. The three are close friends dating back to a freshman leadership honors course at Virginia Tech.

LaFave said he believes the defining moment came when he and Olson attended the Fancy Food Show in New York City last year and talked to food producers who didn't have the means to get their products into stores.

The concept is modeled after a craft site called Etsy.com.

A number of food vendors from across the country have expressed interest in participating in the site, which originally was going to be launched in May.

Foodzie founders decided to delay the launch until they have a chance to work with TechStars mentors. Pricing has yet to be determined, but Olson said the goal is to make it reasonable for small food producers.

Olson may be the one who had passion for cooking in college, but she said all three co-founders are passionate about gourmet food. A previous trip to Boulder included a tour of the Haystack Mountain Goat Dairy and samples of the goat cheese made there.

"While I'm the foodie, the other two are huge foodies too," Olson said.

smithje@RockyMountainNews.com or 303-954-5155

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