NJ Founders & Funders is probably one of the best-received programs that the New Jersey Economic Development Authority has to offer, and it’s based on a simple premise: startups in New Jersey need a way to obtain warm introductions to angels and venture capitalists, and angels and VCs who want to invest in New Jersey need deal flow. So twice a year, the New Jersey EDA puts on a program that matches VCs and angels with New Jersey tech and life-science startups.
At the Founders & Funders events, tech and life-science startup founders have ten-minute meetings with VCs and angels. To save everyone time, the EDA prescreens startup applicants to match them with investors who can help them now or in the future. The EDA also helps the applicants prepare their pitches, so they can speak the investors’ language.
More than 150 startup companies have met with investors during the five events held so far. Some meetings have led to term sheets, as was the case with Bergen County-based Eventcombo, which recently received funding from the NJIT Highlanders Angel Network (Newark).
NJTechWeekly.com attended the most recent NJ Founders & Funders event, on May 4 at the EDA’s Commercialization Center for Innovative Technologies (CCIT), in North Brunswick. Approximately 20 investors met with about 30 startup founders. We interviewed some of the founders who attended. This is the first of a two-part story.
One of the first founders we encountered was David Kolakowski, whose startup, ExExpense, is located in Asbury Park. ExExpense is an application for divorced couples that lets them manage the shared expenses generated by their children. Keeping track of these expenses is difficult, Kolakowski told us. “We solve that whole problem, so nobody has to keep spreadsheets or documents. You just take a picture with your phone, upload it, and it automatically notifies the other party. It does the calculations and keeps track of running totals. We call it ‘happiness’ because nobody has to communicate, do calculations or keep paper.”
Kolakowski noted that ExExpense is relatively new and not at the revenue level that would attract investors, but he came to NJ Founders & Funders to establish some relationships with investors and to get some advice. “They gave me some incredible advice for free on how to change our marketing plan and change our approach,” he said. “I just met with Jay Bhatti (who now has offices at Bell Works, in Holmdel), and what he recommended about how we market and how we use our partners to sell is completely different from what I’ve been doing. I hadn’t thought about that [approach].” Also, a VC from Touchdown Ventures (Vorhees) advised him on how to better approach social media. “The advice was different from what I have heard from the social media marketing companies. …He is the one who is investing, so he knows what works.”
Khadir Mohammed, founder and CTO of community-based healthcare tech startup Medshifts (Philadelphia and Camden), told us about his company, which is building a patient-centric platform to reduce the problems that now happen in medical transportation. The platform eases communication among the patients, Medicare or other providers, and medical transportation companies, so that patients get the correct transportation for their illness and transportation companies can be preapproved for payment.
“Everyone discounts the role of transportation companies [in healthcare], but if you really look at it, they have a big impact on what care goes on. It’s important for us to enhance their ability to do the right thing, and not have the wrong vehicle pick up the person, which results in billing the wrong amount of money,” he said. Medshifts will tell the transportation company about the care requirements, any chronic conditions and the mobility of the patient.
Mohammed said that the meetings with investors went very well. “I think there are two or three VCs who are interested in pursuing this, so we have follow-up meetings next week or the following week. We also received some information about what we can do, and what others who are in our similar stage do. We are waiting for dollars, but one of the VCs told us we should start building the solution and meet some milestones, which will make it easier for us to get funding. We also have traction with three customers. Having them pay us and having some revenue will make it a lot easier for them to consider us.”
Abran Maldonado is a TechLaunch accelerator graduate whose ed-tech company, NuSkool, is taking off. Maldano, who is now located at the Asbury Park coworking space Cowerks and Vi Coworking Hub at Holmdel’s Bell Works, told us that since TechLaunch, his company has been trying to take its theory about the right way to engage students into the commercial marketplace. Nuskool’s unique proposition is that students absorb lessons better when they are based on contemporary issues.
NuSkool is in version two of its subscription-based online platform, which allows teachers to create virtual classes, providing access to lessons based on contemporary, trending topics that matter most in students’ lives. The company also provides resources to teachers, including a library of standards-based lesson plans, access to assessments, quizzes and test-prep exams.
“This is all in real time. As events are unfolding and becoming viral…we are churning out instructional resources around those events,” he said. NuSkool has seen some success, and has organic users from across the country and across the world, giving it a good sample size.
“We’ve been scrappy. We’ve been bootstrapping, we’ve been funding things on our own and funding things through grants and other different funding opportunities. But I think we are really ready to scale, now that we have a good idea of who our customers are. We want to reach people at a national level. Now we need to reach critical mass.”
Asked how the meetings with investors went, Maldonado said that they had gone well, and one potential investor gave him a lead about an educational event happening at the University of Pennsylvania the next week, and even sent an RSVP on behalf of NuSkool for the event. “I also met with the [NJTC Venture Fund], which is raising a new fund now that will probably be ready in the fall. And we’ll have some new developments on the site that we are very excited about that will also be ready in the fall, so we will coincide with that timing.”
Covellus is a startup medical-device company located in Bellmawr. According to founder and CEO Bradley Beach, the company is developing some new technology to be used in vascular stenting. “I’m a mechanical engineer and have been in medical devices for 11 years. I was in a position over the summer to pursue whatever I wanted. I had some success in the past through a previous acquisition, and came up with an idea.”
He started to work on that idea, filed for a patent, asked others in the industry what they thought, got some feedback and made some prototypes. After more feedback, he made some more prototypes and filed for more patents, he said. “Every time I talked to people, they said they hadn’t seen anything like this. It felt really good!” Beach told us.
Beach came to NJ Founders & Funders after recently closing a seed round using a convertible note. Asked what he thought of the event, he said, “not everyone was interested, of course, but we think we found some people who might be interested down the road. We are at a very early stage. I’m looking for people who can help me raise a larger round to get us to a significant milestone, like regulatory clearance with the FDA.”
And did Beach get some good advice from VCs or angels? Yes, he said, and it was very helpful. “Investors told us that we have to refine our pitch and figure out how to present these complicated ideas to people in a way they could understand them.” Having explanatory materials or visuals would also help, he noted.