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The 6th Annual Accelerate Michigan Innovation Competition (AMIC) was held in Detroit November 4-5, and New Enterprise Forum salutes all participants for their efforts.  Special congratulations go to $100,000 Prize Winner Genomenon, an NEF coached company presented by our own Board member Steve Schwartz!

Of the 55 semi-finalist teams from around the State, almost one quarter of them had received coaching from NEF Teams:

·         ArborLight                             Beet Analytics                      Civionics                               ContentOro

·         GAPro System                      Genomenon                         LogiCoul Solutions

·         MakerOS                               MyFab5                                  PhaseIQ

·         PicoSpray                              SurClean                               Workit Health

 

In addition to Genomenon, WorkitHealth qualified as one of the ten finalists.  ArborLight (Alternative Energy), WorkitHealth (Information Technology) and PicoSpray (Advanced Transportation) won top awards in their categories.

 AMIC is not just a business plan competition, but also a great event for networking and connecting with potential investors.  Several of our presenting companies reported getting requests for follow-up meetings from investors.

 New Enterprise Forum is proud of the work it does to help entrepreneurs connect with potential investors, and congratulates this year’s AMIC winners.

How do NEF coaches stay current on the investment process and refine their coaching skills?  By participating in other mentoring/coaching processes, that’s how!

This fall, a number of NEF coaches are volunteering their time to act as mentors for the University of Michigan course, Financing Technology Commercialization, FIN/ES - 329/629 run by Prof. David Brophy and David Bloom.  This course walks 15 actual start-ups and assigned student teams through the process of evaluating their assigned start-up and using their evaluations as the basis for preparing an Investor Presentation.  Each team is assigned local mentors as well as actual investors from the East Coast and Silicon Valley.  As volunteers, NEF mentors get access to what students are being instructed on, panel discussions made up of investors and start-ups discussing their experiences and recommendations, and a (non-NEF) mentoring/coaching experience.

 NEF coaches participating in this year’s course are:

•    Stew Nelson

•    Bill McPherson

•    Francis Glorie

•    Sheu-Jane Gallagher

•    Gary Hazen

If your interested in becoming a coach or are an entrepreneur interested in receiving presentation support, please contact the NEF at newenterpriseforum.org.

Ever wonder how venture capitalists and angel investors decide on whom to invest in? Or how many pitches they see in a year?

The panelists at the September NEF Forum meeting answered those questions and more. So far this year Dave Gregorka of Baird Capital has seen 75-100 pitches and Tom Shehab of Arboretum Ventures 125-150. That’s a lot of pitches. If you are an entrepreneur seeking funding you likely often wonder, how does one pitch prevail over others and what are VC’s looking for?

All panelists agreed on the importance of seeing “due diligence” in the teams they review.  Doug Finch, who is involved with angel investors groups, looks at how good the team is (CEO, etc), the size of the market, and what exit strategy they are aiming for. It’s important the entrepreneur knows the “lay of the land”, stresses Doug Gregorka. Doing the research to understand whom funds what enables entrepreneurs to focus on those VCs and angels who they have the best chance of getting some interest from.

Following a question from the audience about whether $15 million is too much to raise in Michigan, moderator Emily Heintz, Associate Director, Michigan Venture Capital Association, noted that 56% of capital comes from out of state. She added that Michigan does welcome activity from other states. The rise of syndicates that organize to fund a particular venture adds to multi-state funding. Gregorka confirmed, “The midwest is used to syndicating”. It was agreed that $15 million is not too much to raise in Michigan. “If the deal is right we’ll find the money”, Gregorka summed up.

Regarding where the VC money is coming from these days Finch said that lots of “quiet money” is coming from conservative Michigan investors–what is often thought of as old money. And, when deciding who to approach, don’t worry too much about what a VC or angel has invested in in the past.  “A VC might want to balance their portfolio so don’t rely on past investments too much”, adds Gregorka.

To learn more about the investment community two books were recommended. Angel Investing by David S. Rose talks about how to become and angel investor. Venture Deals by Brad Feld and Jason Mendelson deals with the mechanics of negotiating the deal. It’s important to remember that a VC can bring more to the table than just the check.

 

 

One characteristic of successful entrepreneurs is their laser-focus on their business. Unfortunately, this often causes them significant problems as they neglect their personal lives. If this continues for an extended time, the consequences may be severe.

One best practice is to step back and create a vision for your life. This allows you to remember why you got into business in the first place and to make sure you have the business aligned with your personal goals and aspirations. To avoid this risks relationships and could lead you to hate the business you started.

Entrepreneur Magazine published a great article, “8 Steps to Building Your Business According to the Lifestyle You Want”. Check it out at http://www.entrepreneur.com/article/239957

The Ann Arbor-based startup, Virta Labs, is developing a technology platform that will defend medical devices from malware attacks. Pace makers and other high-tech pieces of medical technology are vulnerable to cyber attacks because security is largely undeveloped.

One-year-old Virta Labs, which won the Best of Boot Camp award at Ann Arbor SPARK's Entrepreneur Boot Camp last year, focuses on protecting those medical devices. The company has recently built prototypes and is looking to beta test its security technology later this summer.
 
Virta Labs recently grew its team of 10 people. That staff includes seven PhDs, a strong technical team.

Each year for twelve years, Michigan entrepreneurs have vied for the opportunity to be recognized as one of Michigan’s 50 Companies to Watch. This dynamic program opens up new worlds for Michigan’s successful entrepreneurs, by introducing them to each other and customers, suppliers, legislators, expert resources, and relationships around the state. The program kicks off September 1 with companies from around the state in every industry being nominated for the innovation and growth that makes them “worth watching.”

Entrepreneurs are welcome to nominate their own companies. Business bankers, CPAs, attorneys, and other professionals are encouraged to nominate their exceptional clients. Consider your customers and suppliers – among them is a company that would be exciting “to watch.” 

Your nomination can put a deserving second-stage growth company in the spotlight. Each year 50 second-stage Michigan companies are selected for the impact they make in their markets, in their communities and in the state. We’re looking for companies that are notable for their marketplace performance, innovation, philanthropy and empowered employees.

The 2016 awards will be presented at the 13th annual Michigan Celebrates Small Business (MCSB) event on Thursday, May 5, in Lansing. This prestigious event attracts an audience of 1,000 and has played a key role in supporting and recognizing the achievements of Michigan’s new economy businesses from all parts of the state.

Among the recipients of the 2015 Michigan 50 Companies to Watch awards, are Algal Scientific, BEET Analytics, Histosonics, and Varsity News Network – all companies that have gone through the NEF Coaching Team process or were coached by NEF for Michigan Growth Capital Symposium or Accelerate Michigan Innovation Competition. A complete list of award winners can be found on the event website at http://www.michigancelebrates.biz/the-event/2015-award-winners/

 Nominations will be accepted beginning September 1 at www.michigancelebrates.biz. For more information contact Diane Durance at ddurance@miquest.org.

 

As the culmination of the DTX Launch Detroit program, an intensive 10 week student (undergrad, graduate and 2 years post-graduation) technology-focused accelerator program, TechTown Detroit hosted the Showcase event on Thu, 30 July. Approximately 200 people attended, with visitors coming from as far away as Kalamazoo.

Following is a list of the team that presented, a very short summary of their product/service, and the name and email address of the team lead. Those who can help these teams further develop their ideas are encouraged to contact them.

Assistive Robotics: A stability enhancing lift device that aids a person in standing with their own power from a seated position in the therapist’s office. James Jones, jonesje3@udmercy.edu

CAREPRN: A trusted digital marketplace providing easy, immediate access to certified in-home care professionals in moments of crisis. Jason Wolfe-Greer, Jason.wolfegreer@gmail.com

COSA: an online collective of student artists’ portfolios to advance their art careers. Connor Borrego,  conrbor@umich.edu

DineRoll: A community-focused marketing platform for driving new business to local restaurants through food events. Jasmine Rostkowski, jasmine@dineroll.com

MySwimPro: A mobile application that delivers individualized swim training and tracking for masters swimmers and triathletes who are focused on improving their performance and health. Fares Ksebati, fksebati@gmail.com

Optis Creative: A video game crowdfunding service that protects donors, also known as backers, by overseeing development and financing of funded projects. Aigbe Idahosa, aigbe15@gmail.com

RealTime: A platform for college students to create and find local pop up events. Shreya Arora, ashreya@umich.edu

SteerPeer: A mobile platform that matches college students with peer tutors. James Biller, Jamesbiller7@gmail.com 

Student Connect: An app that allows international students to get their non-academic questions answered faster than contacting an advisor. Kevin Mendez, kpmendez.a@gmail.com 

Syntheslide: An inexpensive digital pathology solution that allows pathology staff to scan and share microscope slides with their smartphone to help remotely diagnose patients. Nakul Shankar, Nakshank@gmail.com 

The Broke App: A mobile, personal finance tool that allows banks to reach and teach college students how to build wealth for the future based on their current spending habits. Kristen Sheppard, shepp@umich.edu

The Mission of the New Enterprise Forum (NEF) is to Coach (Help Entrepreneurs develop effective communications to reach potential investors), Perfect (Develop investor-ready presentations and Executive Summaries), and Connect (Provide help to reach the investment community).

One of the most difficult things for any new business are the issues facing an entrepreneur in the arduous journey funding.

This slide show has great information about the process. NEF has some different approaches to the presentation process, but the points made are critical for every entrepreneur seeking funding.

http://www.slideshare.net/InspirationalMoments/pre-funding-essentials2pdf-to-upload?from_m_app=ios

SCORE recently ran an article (Ann Arbor News, June 14, 2015) discussing how inventory control is part of a sound management strategy.  Without good controls companies can run into financial difficulty.  Good inventory management is a difficult, but necessary, balancing act.  While excessive inventory can tie up significant amounts of cash, a shortage of inventory will drive your customers to other vendors. 

In addition to the cost of acquiring inventory, there are hidden expenses for its storage and handling including insurance, damage to product, and even obsolescence.  Time (and money) spent both taking a physical inventory and just searching for needed products can add up quickly when the inventory is not well managed.

One other important inventory issue not discussed in the article is configuration.  Most companies go through a number of revisions during the design phase of their product and startups are no exception.  Many of these design cycle changes never see the light of day or only as a mock up or prototype.  However, once product is released for sale, engineering changes continue to happen.  This means different customers are actually buying different products.  This can be true with software as well as hardware items.

It is important to know how to identify what revision product a customer has purchased.  This becomes a critical issue if there are product complaints from your customers, technical questions, or even the worst case scenario of a safety recall.

A good rule of thumb is that whenever a change is made to the form, fit or function of the device, the change must be recognized and a new internal part number assigned to the item.   Other types of changes such as drawing corrections or clarifications are usually managed by a change to the item’s revision level.  Your marketing name can stay the same, but your product label and sales records must reflect the correct configuration.  This will provide better customer service down the road and assist in controlling product liability issues.

Many of us do not think of restaurants as heavy users of technology but as with all businesses that realm is changing. Recent surveys and articles outlined in Nation’s Restaurant News point out that consumer and demographic trends are changing the way that restaurants, particularly in the pizza, fast casual (think Panera) and quick service areas (McDonald’s Wendy’s, etc) are doing business or will be doing business in the future. “Technology-friendly service in restaurants has become important to consumers broadly, and to Millennials and Generation Z customers, it’s essential,” said Colleen Rothman, manager of consumer insights for Technomic, the firm which conducted the survey.

 Ann Arbor based Domino’s is the recognized leader in digital ordering and attributes its 14.5% sales growth in the last year to a variety of apps and digital ordering innovations, including just introduced text ordering, that allow it to compete against less tech savvy competitors.   These competitors include many smaller chains and independents that do not have the breadth of technical expertise that Domino’s can muster.  Perhaps that underserved segment represents an opportunity for the right service provider or app. 

Interestingly, Hungry Howey’s, also Michigan based, was ranked second in the survey conducted by Technomic for offering the most digital options for customers to interact with the company.  These included ordering but also offering of reward and loyalty points.  Surprisingly, the high end full service Capital Grill received high marks from  the survey respondents for its I-Pad based wine list and related wireless ordering program.  Among others listed in the top ten companies as the offering the best digital options were Starbucks and Chic-Fil-A. 

Industry growth and demographic trends are also contributing to the use of additional technology in restaurants. Jim Sullivan, an industry consultant and speaker, notes that growth in the industry is projected to require an additional 1.7 million jobs in the next few years.  Currently there are not enough good workers to fill those jobs and immigration probably won’t fill the void as no solution is likely in an election cycle nor will many members of Generation Z, as they do not appear to be clamoring to work in the industry.  Thus, Sullivan feels that tablet menus and ordering from them in full service establishments and the growth of menu kiosks in fast food locations will offset the need for around 680,000 servers and cashiers by 2020.  Additionally, he sees that the growth in electronic payment methodology will ultimately disrupt the need for cash registers and point of sale systems resulting in the need for fewer bookkeepers. 

On the unit manager side, he sees the acceptance of wearable technology like the Apple Watch and android watches and apps that work on them providing “managers real-time updates on how to control food costs, utility usage and labor efficiency, with specific suggestions on who to cut early and how to schedule the next shift based on weather, history and promotions. New customer-to-regular ratios and diners’ frequency numbers will also be relayed live, improving table visits and repeat business.” These tools when coupled with camera systems will lead to the ability for the manager to monitor activities in the dining area, the bar and the back of the house on a real time basis.  He believes that this will lead to improved operating performance and training in the restaurant.    

What does all this mean?  It means there are opportunities in all types of business to develop technologies that can disrupt the current means of doing business and to offer value to operators in that business segment.  Look at the current environment to determine where the problems are and where they will be and consider how those problems can be solved.

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