Wouldn't it be nice if there were something akin to the Bat Signal that could shine bright over the state, putting out the call to entrepreneurs to come forward with their great ideas and innovations to receive support and funding? While they may not be caped crusaders, the business plan and tech startup competitions that have popped up recently in NH have certainly been heroes to the companies that have won them.
From the Holloway Prize to VentureX, these competitions not only highlight innovative startups in NH, but provide these entrepreneurs with important pieces of the success puzzle: capital, exposure and expertise. All of these competitions are a benefit because they identify who are the ambitious entrepreneurs in the state of New Hampshire, says Jamie Coughlin, CEO of abi Innovation Hub, a nonprofit business incubator focused on attracting, mentoring and fostering technology startups and innovative companies. Coughlin and abi have been integral to creating several of these competitions.
All of them are kind of exciting, Coughlin says. And [they] make the point that New Hampshire has an innovative startup community and that we are doing things differently.
TechOut
The newest competition in the state, TechOut, is designed for technology-based startup businesses. It is open to any business in the United States. The competition, organized by the NH High Tech Council and the abi Innovation Hub, both based in Manchester, is open to startups that have been in business fewer than three years, raised less than $250,000 in funding and have less than $250,000 in revenue. The competition gives out $100,000 in prize money: first place receives $50,000, second place $30,000 and third place $20,000. The judges award the top two prizes with the third decided by the crowd at the TechOut event.
At the inaugural TechOut, held in September, miEdge in New Boston, which provides an insurance prospecting tool for employee benefits and health and welfare industries, claimed first place. The $30,000 second-place prize went to Portsmouth-based Therma‐HEXX, a manufacturer of high efficiency heat exchange products. The $20,000 third-place prize, selected by audience vote, was awarded to Sensible Spreader in Durham, which designed a de-icer spreading system that uses GPS technology to map watersheds so specific de-icers can be applied on roadways.
Those cash awards are provided in the form of equity in the company and applicants must agree to the competition's investment terms in order to enter. The prize money is provided by a group of 20 accredited NH investors who formed a fund specifically for the TechOut prize pool. The competition already has secured enough funding to provide prize money for four more annual competitions.
For companies considering entering next year's Tech Out, it's important to take time to develop a great idea to the point where you can show judges it's a viable business and that winning the prize package will move the needle for this new company, Coughlin says. An investor is looking to place their money in a company that's really growth oriented, that's going to give them a return on something in a five-year type of window, he says.
Most of the judges in the competition are members of the Entrepreneurs Foundation of NH (EFNH), an initiative of the NH Charitable Foundation aimed at encouraging entrepreneurs to take on philanthropic efforts. Through the program, companies make a small grant to the NH Charitable Foundation to EFNH in the form of shares of stock, ownership interest in limited liability companies, stock options (or equivalents), and other forms of equity. When a company has a liquidity event (such as the business being sold, or issuing an IPO), the gifted cash is deposited into the fund, which in turn makes grants to nonprofits chosen by EFNH members. TechOut encourages, but does not require, contestants to contribute founder's shares to EFNH.
For more information, visit www.abihub.org/techout.
VentureX
This year also marked the introduction of the VentureX New England competition, and Coughlin says this competition, too, will be an annual event. With the tagline, Pitch it, launch it, scale it, VentureX was launched by Wasabi Ventures and the abi Innovation Hub with the goal of finding web and Internet startups. Wasabi Ventures is a venture capital firm that provides venture capital, startup incubation, and consulting Services.
Billed as the ultimate pitch day event, VentureX is a one-day event with the winning startup receiving a $30,000 investment-$10,000 cash and $20,000 in engineering and product management services from Wasabi Ventures-in return for a 5 percent equity stake. To enter, a business has to be for-profit, have raised less than $100,000 in funding and generated less than $100,000 in revenue.
At the inaugural event in January, applicants mingled at a free, expo-style cocktail party that attracted 250 attendees. Ten teams were given booths, where they presented their project or startup to attendees. Each attendee was given five golden tickets, which they were allowed to distribute as they wished among the 10 startups. The three teams that had the most golden tickets qualified for the final pitch round. The three finalists each had 10 minutes to pitch a panel of five judges made up of entrepreneurs and investors, who choose the winner.
Team matters, Coughlin says. Oftentimes you hear the phrase, investors are not just investing in your idea, they are investing in you and the people around you.' So that kind of matters. The winner of the first competition was Mosaic Archive, online storage for serious photographers. (See profile on page 11.)
For more information, visit www.venturex.wasabiventures.com.
NH Start Up Challenge
The NH Start Up Challenge is a statewide business plan competition designed to encourage entrepreneurship and innovation, says E.J. Powers, NH Start Up Challenge co-chair. The Manchester Young Professionals Network, the state's first and largest young professional networking organization with nearly 3,000 members, created the competition in 2008.
What we enjoy seeing is that the Start Up Challenge has grown in terms of the quality of contestants and hopefully the winners over the last four years, Powers says.
The NH Start Up Challenge offers $55,000 in cash and in-kind services, including up to $25,000 in cash, a seat in the abi Innovation Hub's Accelerator Program and one-year residence at the abi.
The prize package also includes legal and accounting services as well as an advertising campaign in Business NH Magazine. The annual competition has awarded more than $155,000 in cash and in-kind services to entrepreneurs during the past four years, Powers says.
Contestants have to be in the early stages of their projects or startups, though those who only have a business plan will be considered. Applicants have to be NH residents and the owner or founder of the startup, which itself has to be a for-profit venture. The business must be less than three years old, have raised under $100,000 in funding and generated under $100,000 in revenue.
To enter, contestants submit a one- to two-page overview of their concepts. The application packet can also include one- to two-minute video pitches. Between 50 and 100 people apply to the competition each year, says Powers. This year, 30 were invited to compete and of those, only five were named semi-finalists and invited to submit a formal business plan.
Before they move on, the semi-finalists are paired with mentors, Powers says. In the past contestants have been paired with members of SCORE, a group of retired and seasoned executives who provide young businesses with business, financial and marketing advice. Contestants have also been sent to the Stonyfield Farm Entrepreneurial Institute and paired with mentors at abi Innovation Hub. This training is meant to not only improve their business or business plans, but also prepare contestants for a round of live pitches delivered to an audience of movers and shakers.
We've heard from our contestants that the process is almost as valuable as being chosen as the ultimate winner, Powers says. Also, we find at the pitch event, this gives these contestants an opportunity to interact with other entrepreneurs and to really expand their network. And oftentimes we have bankers, venture capitalists and others in the audience, so it's a unique chance for them to test their idea, see what the response is.
From there, two finalists are chosen to further hone their plans and prepare for a face-to-face meeting with a panel of judges. These two finalists then present a final pitch in front of an audience, where they will have to answer questions from not only the judges, but also audience members. These judges really put them through the ringer, Powers says.
One entrepreneur is then chosen. In order to win, businesses must prove to the judges there is market opportunity for their product or service, they have the ability to provide a competitive advantage; and, that their team has a solid understanding of the financial requirements of the business. Management capability and investment potential are also considered.
Last year's winner was Nearby Registry, an online gift registry service for independent retailers and service providers, while Gear Freedom, an outdoor sports equipment rental company, nabbed the top prize this year.
If you want to take your startup to the next level, this competition is your opportunity. If you're passionate about your idea and have the research and figures to make a compelling business case you could very well be the next Start Up Challenge winner, Powers says. At the very least you will walk away knowing more about yourself and your business.
The Holloway Prize
The Holloway Prize Innovation-to-Market Competition is the granddaddy of all of these competitions, having been around for 25 years. Sponsored by The University of NH Whittemore School of Business and Economics, the goal of this competition is to inspire and stimulate entrepreneurship among students in the University System of NH. The competition is open to all USNH undergraduate and graduate students-of any major-looking to start or expand a business. The winner receives $10,000.
To enter, students must first submit a two-page questionnaire that amounts to a detailed business proposal, says Michael Merenda, chairman of the competition. The students-particularly non-business majors-are encouraged to attend a student matching session, where an applicant team can recruit a business student to help develop the proposal or even an engineering student to help develop the product or service concept.
Only about 25 teams will advance to the next round, which entails submitting an even more detailed, five-page business proposal that includes an executive summary, cash flow and pro forma statements. Ten teams will be eliminated at this point, leaving 15 to advance to the Bud Albin Challenge Round. Here the teams finally get to make their pitch. They have 10 minutes to present their business concept to the judges, followed by a 15-minute question and answer period.
The judges huddle and pick six teams to advance to the Holloway Championship round. All 15 Albin semifinalists are then matched with a judge who will give one-on-one feedback to the team and act as a mentor. The students also get video copies of their presentations to critique and learn from.
In the championship round, teams once again have 10 minutes to present their business proposals to new judges. The first-place winner gets the prize money, as well as incubation space at the NH Innovation and Commercialization Center, marketing and design assistance, and legal services. Second place receives $5,000 and third place $2,500. The remaining three teams or individuals each receive $1,500. The 2012 winner will sound familiar-it's Sensible Spreader, which also took third place in TechOut. For more information about The Holloway Prize, visit www.wsbe.unh.edu/holloway-prize-innovation-market-competition.
Merenda says winning teams usually end up with new business contacts, exposure, a better business plan and, in some cases, an investor who saw and liked the presentation. He says the key to winning is the simplest. You've got to enter, he says. You've got to take the leap. And then I would certainly advise them to make use of the resources and significant talent we have in this area. Merenda suggests interviewing local entrepreneurs, viewing videos of previous projects, take a class or two in accounting, entrepreneurship or marketing and making use of the free services at the Small Business Development Center at UNH.
The proposals that move on are opportunity driven, well researched and based on facts and not just opinions, he says, adding applicants should work with a mentor, faculty member or practitioner to practice their presentations as much as possible to constantly refine their proposals and hone their presentations. The other thing is don't get discouraged. What might not work with one set of judges may work with a different set of judges, he says.
Coughlin also strongly recommends seeking out the mentors recruited to participate in these various competitions for advice before entering any of the contests. One of the most important contributions of these competitions is shining a spotlight on these emerging companies. It's about being able to pitch in front of those 250 people and getting that opportunity because you never know who is going to be in the audience.