The Customer Says..
At StartX, our core “business” is helping startup founders develop.
They’re the “customers.” We provide the product and service.
In support of Entrepreneurship Week 2012 at Stanford, some of our fellows served as panelists for two different speaking events. One panel focused on issues related to medical technology entrepreneurship. The other panel featured StartX fellows working on a variety of industries, including social media, enterprise, medtech, consumer internet, and social gaming.
As a StartX staffer in the audience, the speaking engagements were an interesting opportunity to hear our “customer-founders” talk about the program and review their experiences in public. We’re big on feedback, so a lot of this was not new, but seeing them on stage explaining to students what they’ve learned was pretty rewarding. It was also rather novel to see some newly minted founders, embracing the job of inspiring entrepreneurship through their own stories. For the attendees, consisting primarily of aspiring Stanford student entrepreneurs, the talks offered some solid advice as well as stories about what it’s like to accelerate with StartX.
E-Week StartX Panelists: General Session (left), Medtech Session (right). Photo: Alexa Lee + Arti Patel
Here’s a list of the StartX companies and participating founders:
AgeTak, Dr. Pratik Verma
Bell Biosystems, Dr. Caleb Bell
Carbon Lighthouse, Brenden Millstein
Game Closure, Michael Carter and Martin Hunt
Gauss Surgical, Milt McColl
Jetlore, Montse Medina
MindSumo, Rohan Puranik
Stem Cell Theranostics, Divya Nag and Andrew Lee
Clear Ear, Lily Truong
Mentors Get an A+
On stage at Cubberley auditorium, MindSumo (Winter 2011) co-founder Rohan Puranik, kicked off a StartX mentor “love fest” by calling out some of his company’s advisors, “Our two leads Anthony Soohoo and Dave Hodson. If you guys end up in StartX, you should actually fight people to get them. Actually fight for it,“ he said with a totally straight face.
MindSumo meets Anthony SooHoo at Mentor Mixer Night, Winter 2011. Photo: Alexa Lee
Puranik’s startup enables companies to post corporate challenges for students to solve. Since they launched their alpha product at Stanford about two months ago, they’ve onboarded more than 500 student solvers and have signed up a few major corporations. MindSumo, which has some big news to share in the coming weeks, pivoted a few weeks after the session started. Puranik described how their mentors helped them recognize the need to pivot, evaluate the decision, and guide them with executing the new idea.
Other mentor/advisor shoutouts from the panel went to Jay Borenstein, John Lily, George Zachary, and the mentoring team for Stem Cell Theranostics.
Community Matters, Start Building Now
Game Closure game nights - Thursdays in Mountain View. Photo: Alexa Lee
When they joined StartX for the Spring 2011 session, “Things got real,” said co-founder and CTO Martin Hunt, who coded round-the-clock with Carter in the very beginning. “It was kind of a transition for us. We went from a basement office that didn’t look anything like a company to being completely emerged in a startup experience (at StartX). Just being around a lot of other startups made the whole experience a lot less foreign and a lot more part of our lives,” said Hunt.
Once acclimated to StartX, Game Closure really started to take off. The company has since raised a large funding round, hired close to 30 employees, and now frequently sponsors StartX social events.
OTL and FDA
The FDA and Stanford’s Office of Technology and Licensing, which creates licensing strategy for technology developed at Stanford, got mixed commentary from the panel discussion held at Thorton Center featuring medtech companies.
Milt McColl, a two-time Superbowl champ who has been involved in five medical startups, including his latest – Gauss Surgical, told the audience, “If you’re coming into the medtech space you really need to understand the FDA regulations around it,” he said. McColl’s company, which closed a round of seed financing earlier this year, develops a blood management platform. His team works out of StartX headquarters at the AOL building in Palo Alto, where he advises startups as a StartX Entrepreneur-In-Residence.
While discussion about the OTL took up a significant portion of the panel time, some founders asked that their statements not be unpublished. Others were more open. Dr. Caleb Bell, co-founder of Bell Biosystems, which has introduced a technology that creates an inheritable magnetic signature in eukaryote cells, told the audience, “We made a conscious decision not to use Stanford resources to develop our company. This is a double edged sword,” he said. “We own all our IP, but have struggled very hard to get to where we are today.” Bell, who took part in StartX’s 2nd class – Fall 2010, founded and bootstrapped his company while finishing his Ph.D in Biophysical Chemistry at Stanford. Since presenting at the StartX Demo Day for investors earlier this year, Bell has fielded tons of inquiries from investors interested in learning how their technology will impact diagnostics, cancer treatment, regenerative medicine, and cell therapies.
Get Credit and Learn On The Job
Several StartX founders from both panels started working on their companies while in school. Some recommended that student entrepreneurs leverage project classes and independent study options for earning academic credits and building their companies.
“The more you can get Stanford to give you time, the better,” said Brenden Millstein, co-founder of Carbon Lighthouse, which makes it profitable for businesses and entities to eliminate their carbon footprint. Millstein, who received a master’s degree in Renewable Energy Engineering and an MBA from the Graduate School of Business, said he took four classes that enabled him to fulfill academic requirements while working on his startup.
Cameron Teitelman, who founded StartX in 2009 while a student at Stanford, shared an example of how he used a decision analysis class to work on a real world issue that involved his first startup, the Essential Card. “It’s a way to hack into Stanford to really get value out of the classes as a founder…I know a lot of student entrepreneurs who effectively used project classes to work on their projects, which then turned into companies,” he said.
Jetlore founder Montse Medina, who is on leave from the Ph.D program in Computational and Mathematical Engineering, says due to the nature of her course load, she never actually took any classes related to business or entrepreneurship. “There’s nothing like learning on the job,” she explained. Medina has adapted to her chosen role and now leads an impressive, highly technical startup with a mission to give social content more meaning. Earlier this year, Jetlore released an alpha version of its first consumer facing product, Qwhisper, and won a prestigious industry award for its technology and API.
Stanford Is a Great Place To Find a Co-founder
StartX founders said that when it comes to co-founder “prospecting,” the Farm is resource rich. Even so, they warned, student entrepreneurs should still do very thorough vetting. Actually finding and committing to “the One” (or anyone on the founding team) should not be done in haste. McColl, with deep experience as both a VC and a entrepreneur, has seen many startups crippled by co-founder issues. “I’ve seen companies implode and mostly it’s because internally they can’t find a way to work together,” said McColl.
StartX founders face the same co-founder issues. When they do, Teitelman is usually one of the first to be consulted. He recommends that students take classes they’re passionate about and to get to know potential co-founder classmates through shared interests, projects or assignments. If a team decides to do a startup, he advises them to set expectations early on and to take that task very seriously.
Cleantech company Carbon Lighthouse founders Brenden Millstein and Raphael Rose. Photo: Alexa Lee
Millstein, who started Carbon Lighthouse with his childhood best friend Raphael Rosen, told the audience that they wrote out an extensive a contract prior to founding their company. The agreement outlined their expectations and ran through an exhaustive list of “what if’s” about their business relationship. They’re convinced this exercise put them on the right path. In the past year, their relationship has grown stronger. The company, which is moving its main operations to San Francisco, has tripled in headcount and has completed over 70 projects helping businesses and entities become carbon neutral.
Various Funding Options – Get Creative
With the topic of funding, StartX panelists had a lot to say and their experiences were all quite different. This comes as no surprise, as StartX, a non-profit, education-focused entity, works with Stanford founders who have expertise in various industries: consumer internet, biotech, medtech, mobile, edtech, enterprise, social gaming, social entrepreneurship, and hardware.
Take the case of StartX fellow Pratik Verma, co-founder of AgeTak, a big data startup that enables companies to merge large databases while preserving customer privacy. Last year, AgeTak brought in ~$ 4 million in revenue, without ever taking any VC money. In looking back, Verma says that bringing in outside investment probably would have enabled them to move faster. He estimates that five years of work could have been two. “We’ve done it all through grants. If I had to do it all over, I would have pushed for VC money after a certain point,” said Verma. The 28-year old was completing his Ph.D in Computational Chemistry at Stanford while also developing AgeTak on the side. After graduating, he came to StartX on recommendation from his friend, Bell (of Bell Biosystems). Verma’s Demo Day valley debut generated significant buzz for the company and shed light on its corporate mission: to reduce the nearly $3 trillion spent on healthcare and to accelerate research to find cures for diseases like Alzheimer’s and ALS. Verma’s father and co-founder passed away from ALS, which currently has no cure.
Agetak co-founder Pratik Verma bootstrapped to profitability. Photo: Alexa Lee
Last Fall, Stem Cell Theranostics founders received a prestigious, no-equity, National Science Foundation SBIR grant of $150k. Co-founder Divya Nag, an undergraduate studying Human Biology, told the panel audience that their team applied 6 months in advance. “While it was extremely competitive, it has opened many doors.” The StartX company, which includes five scientists, uses stem cell based technologies to screen pharmaceutical drugs for toxicity. It recently validated that their technology is more accurate at predicting cardiac toxicity than any other model on the market.
And finally, there’s the big raise for Game Closure. At the time he spoke on the panel, Carter, who was wrapping up the details of his $12 million funding round, did not leave a clue about his imminent announcement. A few weeks later, they were making headlines. While Carter didn’t have much funding advice to share with the audience (the topic was not discussed in depth), at private StartX speaking events, he will talk at length and quite candidly. Always eager to help out other entrepreneurs, he encouraged the audience to connect with the speakers. “Everyone here should be like a potential mentor. You can find mentors anywhere,” said Carter. Unsurprisingly, he had a crowd of advice seekers waiting for him when the panel ended.
With the closing of both events, students quickly swarmed the speakers, peppering them with even more questions. The interaction seemed to serve as solid proof that having role models within easy reach can make the thought of starting a new venture a little less daunting. This made me proud of our founders’ progress and eager to see who from the audiences may show up in our office someday!
For more information about StartX and our upcoming summer session, attend our info session on April 3rd 7pm at the Nitery, 209 on campus. The application deadline for the session is April 12th.