When it comes to product instructions and owner’s manuals, many consumers painstakingly pore over them during assembly, only to stuff them into drawers or in the trash when no longer needed. If Margaret Martin has her way, those print booklets will soon be a thing of the past, replaced by a more portable, visual application that makes following instructions painless.
“It wasn’t so long ago that people kept maps in their cars and pulled one out to figure out their location. Now everything is on a device that’s carried around,” said Martin, the President and CEO of Merlin Mobility. “Right now, you probably have a zillion owner’s manuals that are in a box and you have to hunt around for them. Merlin would allow you to have all of that at your fingertips whenever you need it. We hope Merlin Mobility helps serve a role much like GPS does.”
How does it work? The ATDC Select company utilizes a SaaS platform that enables companies to create, host and deliver step-by-step instructions to iPhone and Android devices. Equipment, devices and parts are viewed “live” through the camera of a mobile device courtesy of Merlin Mobility’s patented Augmented Reality (AR) – also known as the technology that helps create the “yellow first down line” in football broadcasts. According to Martin, studies reveal that more than 80 percent of people struggle making the mental jump from traditional instructions to a physical object they are working on. The startup helps to eliminate this hurdle by presenting a transparent layer that displays instructions directly over the product, enabling tasks to be successfully accomplished up to 56 percent faster than with traditional instructional methods.
Even more important, Martin says, is that Merlin Mobility provides an interactive way for consumers to “try out” a product before purchasing it. Research shows that 88 percent of people log online to research an item before buying. And that’s where Merlin steps in to engage them. When visiting a particular client website, the consumer simply downloads an app to access a life-size, AR version of the product. Prospective customers can test functionality, play with controls, compare items and even interact with a product as if it was in their own house. The objective? To help drive retail for client companies.
The idea for Merlin came about a few years ago, when Martin – a seasoned entrepreneur – decided to offer learning content via mobile device. After joining forces with Maribeth Gandy, a Senior Research Scientist at Georgia Tech with significant AR experience, Martin applied for and received a grant, hired some programmers and began to bring the concept to life in fall 2010.
These days, the buzz over Merlin is building. A successful presentation at Venture Atlanta last fall opened a number of potential doors, while an ATDC networking event resulted in Merlin’s first big client win – Whirlpool. They’ve since signed on Sortimo, the German-based developer and manufacturer of in-vehicle equipment and, more recently, won Harvard Business School’s Alumni Club New Venture Competition for the Southeast.
As the now nine-person startup looks to the future, they plan to continue utilizing ATDC’s resources and guidance as they move into their next phase of growth and seek out more Fortune 500 clients.
“We’re raising our Series A round and we now have a lot of potential customers, advisors and VCs interested in working with us,” said Martin. “We provide a solution for the entire lifecycle of a product, so I really see Merlin becoming a standard in the industry.”
Which annual event brings together hundreds of Georgia entrepreneurs, startups and technology leaders, as well as robots and a solar race car? That would be ATDC’s 2012 Startup Showcase, where the local technology community will gather on Monday for one of Atlanta’s premier industry events.
Held at the Georgia Tech Hotel & Conference Center, the showcase is open to the public and will include appearances from Georgia State Senate Majority Leader Chip Rogers (R-Woodstock) and Georgia Tech President G.P. “Bud” Peterson. Each year, the event honors Georgia’s brightest entrepreneurs and emerging technologies, putting a spotlight on ATDC’s graduating companies – all of whom have met rigorous growth milestones. In addition, dozens of ATDC’s most promising member companies – representing industries as varied as information security, financial technology, health care IT, mobile technology, clean tech/energy, and medical devices – will exhibit their innovative technologies during the event.
“This year’s ATDC graduates represent the impressive quality and strength of Georgia’s technology startup community,” said Nina Sawczuk, ATDC’s general manager and Georgia Tech’s director of startup services. “They have each achieved significant success in a short timeframe and contribute to Georgia’s growing reputation as a hotbed of entrepreneurial activity and innovation.”
The 2012 ATDC graduates include:
• 3DM Systems (formerly ShapeStart Measurement Systems) offers an in-ear 3D scanner for the digital design of custom hearing aids and earmolds.
• Asankya (acquired by EMC Corporation) is a global leader in enabling businesses and service providers to transform their operations and deliver IT as a service.
• Axion Biosystems developed the first multi-well microelectrode array (MEA) system to provide unprecedented throughput for cellular electrophysiology experiments.
• BioAutomaton Systems Inc. (BSI) designs and manufactures patented automation systems for cost-effective propagation of transgenic tree seedlings.
• Celtaxsys is focused on the discovery and development of therapeutics to treat inflammation by controlling innate immunity. The company has phase I clinical trials planned for its lead compound, CTX 4430.
• Digital Assent provides award-winning PatientPad® technology that delivers personalized health information and advertising to consumers in doctors’ waiting rooms.
• Preparis provides organizations with a new way to protect their people, operations, brands and shareholder value from 21st century threats.
• SimpleC utilizes proven technologies to help seniors of all cognitive abilities engage with those around them and cope with changes in their lives.
Interested in attending? The Showcase runs from 2 to 5 pm, followed by a cash bar after-party from 5 to 6 pm. Although regular registration has closed, walk-ins are welcomed and tickets cost $20 at the door. For more information, visit www.atdcstartupshowcase.com.
ATDC representatives made a strong showing at TiECON Southeast 2012, nearly sweeping the awards categories and helping to prove ATDC’s reputation as a major hub for technology entrepreneurship. Member companies and mentors won four out of the five awards given out at the recent conference, including Entrepreneur of 2012, Top Up-and-Coming Entrepreneur, College Student Entrepreneur and Deal of the Year.
TiE Global is the world’s largest organization for entrepreneurs, with more than 13,000 members worldwide. TiECON Southeast is the largest convention in the region dedicated to entrepreneurs, offering a day full of informative presentations, workshops and a celebration of local success.
Andrew Ibbotson of Digital Assent, an ATDC Select Member, won Entrepreneur of the Year. The prestigious award is presented annually to an entrepreneur who has accomplished extraordinary success and demonstrated high commitment to the entrepreneurial community. Ibbotson was selected by a panel of independent judges made up of previous award recipients, technology company CEOs, private capital investors and other regional business leaders.
“Building a company is a team effort and it gives me great pleasure to share this recognition with everyone at Digital Assent,” said Ibbotson. “Growing as quickly as we have over the past 18 months is not without its challenges. This award is a testament to the hard work, talent and dedication of our team.”
David Moeller of member company CodeGuard received the Up and Coming Entrepreneur award, which honors “rising stars” in the industry. As the young founder of a high-growth company, Moeller was tapped for demonstrating great potential and the characteristics of highly successful entrepreneurs.
“I was honored to be awarded the ‘Top Up-and-Coming Entrepreneur’ of 2012, and join the company of past winners including David Cummings (Pardot), Michael Cohn (Cloud Sherpas), and Shashi Reddy (Case-mate),” said Moeller. “I am thankful for the hard work of my teammates at CodeGuard and for our investors, and am motivated to continue our forward progress.”
Rounding out the top finishers: Kurt Heinrich of ATDC member company eCommHub won the student award, which recognizes college students who have shown entrepreneurial vision. Devon Wijesinghe, an ATDC mentor, earned Deal of the Year for founding and developing a “company with excellence in industry innovation, management and financial accomplishment.”
Congratulations to all four for rocking the awards portion of the TiECON Southeast conference this past weekend!
Like many startup stories, socketware began as little more than a sketch on a napkin – the result of a discussion on “big data” between entrepreneurs dining at an Atlanta-based Waffle House. The concept: to create applications that can help businesses find, store, organize and integrate the vast amount of living data created each day.
“The world has become so digital, which helps to generate ‘living’ data – text messages, Facebook posts, tweets,” said co-founder and COO Joe Reger, Jr. “From a commerce standpoint, there are a lot of opportunities to learn, educate and act based on that data. So our goal was to find a way to organize this information and make it accessible and actionable for businesses.”
Fast forward 10 months and that mission is a reality. Earlier this week, the ATDC member launched its first product – called bmbleb – at Imagine eCommerce in Las Vegas. The premiere global conference draws hundreds of merchants, partners, developers and fans of Magento, the industry’s fastest growing eCommerce platform.
So far, the buzz over bmbleb has been significant, says Allen Nance, an experienced entrepreneur serving as an advisor and angel investor for the company.
“All early signs are that people love it,” said Nance. “The feedback on the brand and the design has been impeccable. Bmbleb is fully integrated into the largest eCommerce system in the world. If you’re a Magento user, you can install bmbleb and it will enhance all of your existing customer records, but even more important, it will drive specific recommendations in the form of alerts.”
Through the application, bmbleb users have access to social media, demographic and proclivity-to-buy data such as: age, gender, employment, demographics, income, social media and homeowner information. The idea is that better data equals more revenue. If, for example, one of your customers moves or gets married or has a baby, you would be alerted and market to them accordingly.
Socketware recently began beta testing for the product and is set to launch a funding round for the official product launch this spring. They hope to have 100 beta users within a month.
Now focused on product development, the startup plans to utilize ATDC’s resources and technology guidance as they move into their next phase of growth. Their goals for the future? To integrate with other leading platforms such as Shopify and ShopVisible, as well as continue to innovate how e-commerce websites use data to drive more revenue.
“Our hope is that socketware as a big data engine starts to spawn numerous other products and in other verticals beyond eCommerce,” said Reger.
Entrepreneurs across the country got a reprieve April 5th from abusive business barriers that have plagued not just corporate America, but startup and fast-growth companies alike. As a result of President Obama signing into law the Jumpstart Our Business Startups (JOBS) Act, the path to new sources of capital, including an IPO (initial public offering), is not only much clearer but also, potentially, a more realistic strategy for entrepreneurial companies. The new law makes the Sarbanes-Oxley rules, which were put in place in the early 2000s, nearly moot. According to a Fox Business News report, “the bill eases corporate governance and financial reporting requirements for initial public offerings, while also loosening a variety of other rules designed to make it easier for private companies to raise capital without an IPO.”
Georgia-based companies are sure to be impacted, as the state is recognized as one of the county’s leading entrepreneurial hot-beds, especially for technology companies. According to Kurt Huntzinger, head of Habif, Arogeti & Wynne LLP’s public companies practice, “Every big company started out small. The more the government can clear bureaucratic obstacles for companies to access capital, thereby enabling them to grow, the better for our national economy. The banks are still reticent to lend, so being able to go to the capital markets in an easier way, means that companies have more options for funding growth.”
Like many prior pieces of legislation, the JOBS Act is an amalgam of loosely related ideas and reforms all tied up in a nice, neat bow. Two of the more interesting aspects of the law actually work in opposite directions regarding the IPO process.
Trail Blazed for Fan Funding
The first interesting aspect is that the JOBS Act essentially legalizes crowdfunding, a vehicle to help companies issue securities (a financial instrument representing value) in exchange for cash to fund their business. As an example, any Average Joe (i.e., a non-accredited investor) can either chip in up to 10 percent of his annual income or $10,000 (whichever is less), in return for a small stake in a startup. Like any other investor, our Average Joe is agreeing to fund the company’s growth today in the hope that his stake increases in value over time.
Mitchell Kopelman, head of Habif, Arogeti & Wynne’s technology practice, has coined the term “fan funding,” as a result of this Act being signed into law. Fan funding is a more refined approach to crowdfunding for startups who don’t have friends and family members to tap, aren’t the right size for angel investors and don’t have a large enough management team to attract professional investors like VCs and PEs.
For example, a smartphone application company may have an app that has 100,000 users globally and an additional 75,000 fans on Facebook and Twitter. As a result of the JOBS Act, that smartphone app company’s fans can now become investors and have an equity stake in their favorite app. “The JOBS Act gives young technology companies another viable avenue for capital, exempt from SOX red-tape. Fan funding, as a new capital category, is going to be an important driver of startup growth,” said Kopelman.
It is important to note that companies seeking crowdfunding investments need to file with the Securities and Exchange Commission (”SEC”) and restrict their crowdfunding financing to $1 million a year, or $2 million if they file audited financial statements.
More Shareholders is Good News for Talent Acquisition
Currently, private companies with over 500 shareholders and $10 million in assets are oftentimes compelled to go public. Young companies, short on cash, that attract top talent with stock options, can quickly find themselves at the brink of this limit, potentially forcing them to enter the public markets before they’re ready. The JOBS Act raises this shareholder cap to 2000. Private companies will likely benefit substantially from this reform, as a larger, more robust market for the shares of private companies is sure to develop over time.
What You Need to Know
- A company using crowdfunding must file with the SEC and include the names of the directors, officers and any shareholder with more than 20 percent of the company’s stock, as well as a description of the business and its financial condition.
- A company looking to raise $100,000 or less will need to provide a financial statement certified by a company principal and tax returns.
- A company looking to raise up to $500,000 will need to provide a financial statement that is reviewed by a CPA.
- A company looking to raise more than $500,000 will need to provide a financial statement that is audited by a CPA.
The most recent recession has clearly taught us that when small businesses suffer, the economy as a whole is slower to recover. The easier it is for small businesses to be successful and grow, the better in the long-run for the macro economy. It is small businesses that hire, and as they grow, their hiring will increase if government restrictions and regulations are removed.
This article was written by Kurt Huntzinger and Mitchell Kopelman of Habif, Arogeti & Wynne, LLP, an ATDC sponsor company.
In the past four years, Axion BioSystems has successfully won four government grants totaling $3.1 million and raised approximately the same amount through investors – funds that have allowed the company to develop cutting-edge, proprietary neural interfacing technologies.
Those achievements have not gone unnoticed. The ATDC Select member has been named one of the winners of the 2012 Tibbetts Award, given out by the U.S. Small Business Administration to honor outstanding companies who have participated in the Small Business Innovation Research (SBIR) program and shown significant success in driving innovation and creating new jobs.
“Our team has been successful in applying for and being awarded grants that are aligned with our product development strategy,” said Tom O’Brien, Axion’s President and Chief Executive Officer. “The ‘Tibbie’ awards are given to companies that take federal funds and actually create something with it, and we’ve created a valuable device that meets a growing need in the life science instrumentation market. We’ve done what we said we were going to do, so this is a wonderful way to be honored for those efforts.”
Founded in 2008 by O’Brien and Dr. James Ross, Axion BioSystems specializes in neural interfacing technologies that can be widely applied to the research, clinical and drug discovery markets. The startup came about when Ross, then a graduate student at Georgia Tech, applied for and received an SBIR grant from the National Institutes of Health that helped pave the way for the company’s product development.
Axion’s proprietary technology measures brain waves and heart beats using high throughput culture plates – an industry first. While current development is focused on pharmaceutical drug screening, ongoing research and product development will result in devices for the medical industry, said O’Brien.
With more than 20 full- and part-time employees now on the roster, Axion leaders are looking to the future – one they hope will bring continued growth and product commercialization. The startup is already on the way to meeting one significant growth milestone: Axion is one of eight member companies graduating from ATDC next month. O’Brien said the accelerator has provided Axion with invaluable resources over the years, including the use of lab space, networking and mentorship.
In search of office space? Spring is graduation time for ATDC startups and several graduates are getting ready to move on – making room for newcomers in ATDC’s headquarters.
Provided by the startup incubator to house early-stage and seed-stage companies, the high-demand space is located in the Centergy One building in Atlanta’s Technology Square. A number of individually keyed offices and workstations are currently open to ATDC members.
“Although ATDC Select companies will get priority, any member can request space on the floor,” said Nina Sawczuk, ATDC’s General Manager and Georgia Tech’s Director of Startup Services. “This is also the case for our satellite campus in Savannah and the biosciences facility at the Ford Environmental Science and Technology Building.”
Last year, “resident” companies demonstrated significant growth, collectively raising more than $40 million in a 12-month timeframe. The available space ranges from an 8×8 cubicle to 2,300-square-feet offices, while monthly rent starts at $200 and increases in price based on the configuration. Leases are renewed quarterly, however ATDC companies have the opportunity to remain in the space for up to three years. Members looking for wet lab space can apply to the Ford building’s waiting list.
Among the many perks of utilizing ATDC space: strong networking opportunities, the use of third-floor conference rooms at Centergy One, discounted parking and 24-hour building access.
“Entrepreneurs renting this space will benefit from the close proximity to Georgia Tech, as well as frequent interaction with ATDC team members, mentors, potential investors and other startups who are experiencing similar challenges,” said Sawczuk.
Ever wonder what would happen if HAL, the computer from 2001: A Space Odyssey, used its artificial brain to predict stocks instead of kill astronauts? Tucker Balch has and the result is Lucena Research. While it may not be as vocal or nefarious as the infamous red-eyed villain, Lucena’s patent-pending technology does apply advanced artificial intelligence to the task of forecasting financial futures.
“We want to establish a reputation as the premier company that puts machine learning into finance,” said Balch, managing partner of the ATDC Select member company.
With an innovative product in the pipeline and significant business momentum generated by Lucena’s participation in the inaugural Flashpoint program earlier this year, that goal could soon become a reality.
Named after one of the most famous and important positions in chess endgame theory, as well as the Spanish town that inspired the name, Lucena aims to provide investors with unique tools designed to find investment opportunities while simultaneously reducing risk in their portfolio. A SaaS web-based interface provides access to powerful algorithms, including equity price prediction, hedge finding to reduce risk and back testing to validate strategies.
The idea for the startup came about in fall 2010, when Balch returned from sabbatical to teach Artificial Intelligence and Finance at Georgia Tech. After developing the software infrastructure for the class, he recognized the opportunity to take those algorithms and turn them into a successful business. And when it comes to AI and investments, Balch certainly has the expertise.
A former fighter pilot for the U.S. Air Force, Balch previously served as a research professor at the Robotics Institute at Carnegie Mellon University before joining Georgia Tech in 2001. About five years ago, he began writing his own investment software – eventually resulting in a consulting job with thinkorswim, where he helped create an intra-day stock price reduction algorithm. Following that, he joined Cerebellum Capital, a hedge fund company that uses AI and Machine Learning techniques as a core technology for trading. In his current position as an associate professor in Interactive Computing, his research includes the study of social insects, such as honey bees. His lab’s software tracks their “dance” movements by video and translates how those movements change under different conditions.
When Balch heard about the creation of Flashpoint – a four-month, lean accelerator program designed to help startups in their search for a rapidly scalable business model – that provided the impetus to transform Lucena into more than just a concept.
“One of the requirements for joining Flashpoint is that you can’t be a single-person company, so that forced me to look for a co-founder,” said Balch. “I found John Corwell, one of my former students, someone at the top of his class. He’s our lead developer now, and he went through the program with me.”
Now focused on strategic partnerships and product development, Lucena is in the midst of a financing round. CEO Erez Katz, an accomplished entrepreneur who served as the startup’s mentor during the Flashpoint round, recently joined the team. Their goal is to launch the product this fall and build up a base of at least 100 customers within a year.
“For us, the most important metric is customers,” said Balch. “I don’t know of any other company that uses AI technologies to forecast future prices. While it’s likely that some of the big hedge funds use this technology internally, nobody offers it to the individual investors. We really will be offering a unique product.”
It’s been a good year for SalesLoft. In recent weeks, the sales intelligence software company has cracked the Technology Association of Georgia’s annual list of Top 40 Innovative companies and impressed a tough panel of judges with a second place finish at Startup Riot 2012. In addition, revenue has skyrocketed and the B2B software application was voted #1 Customer Choice App in January through Salesforce.com’s AppExchange.
Not bad for a six-month-old startup with deep roots in the Atlanta technology community.
“We have been very happy with the growth,” said Kyle Porter, SalesLoft’s President & Co-founder. “Before our second month, we had a working model product and we were able to generate revenue in our first 100 days. We’re adding new customers weekly…and all without cold calling or advertising.”
Of course, much of the success is due to the strength of the product. SalesLoft provides technology aimed at easing the ability to research and identify sales prospects and rank them according to their likelihood to buy. The goal is to increase effectiveness, reducing the time sales pros spend on research so they can focus on the important task of closing deals instead. From job change alerts to company spend predictions, news tracking and technology tracking, SalesLoft offers tools that can capture dynamic data on customer targets and deliver measurable results.
“We’re leveraging the concepts of big data and we’re scanning information on 10 million companies every 24 hours,” said Jon Birdsong, SalesLoft’s Sales and Marketing Executive. “We’re finding crucial data about those companies and prospects, such as which technology they use, how fast they’re growing from a social media or website traffic perspective, how much money they’re spending on products and advertising and other important news and information alerts. It’s like an intelligence engine for your CRM.”
The idea for the startup came about last year, when Porter joined forces with David Cummings, a seasoned Atlanta entrepreneur behind the creation of several local companies including Pardot and Hannon Hill. Determined to find a way to provide deeper sales intelligence for industry pros, the pair bootstrapped their way to a successful start in September. They were also able to benefit from their own product, utilizing SalesLoft software to generate leads and develop a customer base.
Also playing a key role in the company’s growth? ATDC. Prior to launching SalesLoft, Porter worked around the incubator for more than five years, building the skills, professional network and business acumen needed to manage a successful venture.
“My career has been heavily influenced by ATDC. I owe a lot of my mentorship to the people there,” said Porter, a Georgia Tech graduate.
With eyes on the future and the next phase of growth, members of the four-person startup are determined to secure 100 paying customers by year’s end – a goal that is more than feasible due to a rising interest in sales intelligence.
“The whole concept of SalesLoft is that companies are spending billions of dollars on CRM systems, but they’re getting mixed results,” said Porter. “Now, just about every week we hear from a customer that is further in a sales cycle or closed a deal based on our product. We’re bringing life to their CRM and changing the way that businesses sell.”
Want a taste of the software? SalesLoft recently unveiled a free micro product: http://jobchangealerts.com/.
This Friday, a contingent of Atlanta technology industry representatives will head to New York’s Times Square to promote the city’s emerging tech industry cluster – and perhaps flaunt their bell ringing skills. The group – which includes ATDC members – was invited to join Invest Atlanta President & CEO Brian McGowan as he rings the opening bell for NASDAQ.
“Atlanta is home to some of the country’s leading tech companies, but it is also a hotbed of entrepreneurial activity,” said McGowan. “The city offers an ecosystem that supports young and creative tech companies to emerge as the next generation leaders…We want to set the pace for the country, for this sector.”
Atlanta is currently ranked third in the country for cities with the most Fortune 500 headquarters, ranked first in innovation in Zipcar’s Future Metropolis Index and is the home of technology leaders including First Data Corp., AT&T Mobility, CNN and Dell SecureWorks. In addition, a Kauffman Index of Entrepreneurial Activity report released last year shows that Georgia led the nation in new business startups in 2010, while Atlanta tied for the second-most among the 15 biggest metro areas.
Community Catalyst Jen Bonnett will be among those in attendance tomorrow, representing both ATDC and StartupChicks. She said the spotlight on Atlanta is proof of the city’s growth into becoming one of the nation’s hotbeds of technology and innovation.
Other past and present ATDC members in attendance will include representatives from Blinq Media, Emcien, Digital Assent, Oversight Systems, Pardot, Preparis, ScanTech Holdings, Suniva, Synergy America Inc., Team Fenom, The Weekend Collection, Urjanet and Vitrue.
The bell ceremony will air on www.nasdaq.com, so fire up your computer before 9:15 a.m. EST to watch it live.