Welnys, a Jersey City startup with a platform that makes it easy for companies to offer and customize on-site wellness programs, won both the investor panel vote and the audience choice vote at the TechLaunch BullPen pitch event in January.
TechLaunch (Kinnelon), headed by Mario Casabona, is dedicated to generating quality deal flow for early-stage investors and to preparing startup founders for the due diligence process they will face when raising money.
The nontraditional virtual accelerator held its seventh BullPen pitching event at the Piscataway campus of Rutgers Business School at the end of January. The event was attended by a mixed group of investors, business people, academics and members of the Rutgers-based Scarlet Startups meetup group. [The next TechLaunch BullPen will take place March 27 at New Jersey City University.]
The BullPen program added a new feature this year: The startup that wins the investor choice vote will be eligible for $20,000 worth of in-kind services offeredby the law firm Gibbons P.C. (Newark and Trenton), investment-banking firm ND4 Advisory (New York), accounting firm WithumSmith+Brown (Princeton), micro-VC company Casabona Ventures (Kinnelon) and Gearhart Law (Summit)
As always at these events, the audience was able to ask questions of the startups: Welnys, BrandVerge (New York), 1Degree (New York) and the Rutgers student startup SULIS. A panel of investors including Ted Chan, angel investor and entrepreneur; Cristian A. Ossa, angel investor, lawyer and business adviser; Joe Spivack, angel investor; and Seth Tropper, entrepreneur and innovator gave the startups feedback on their presentations.
Heather Waibel, the founder of Welnys, actually presented last at the event, but her pitch had the biggest impact. Waibel told a story about her experience working for PayPal: While she was on the road visiting remote offices, she’d participate in the company’s wellness program. However, the program wasn’t the same at each office. Also, while you could get yoga classes in Texas, for example, no one attended them. She asked human resources about it, and they told her that the choice of which wellness programs to offer was up to each facility manager.
“And this is a problem because companies are not just offering these programs as perks. They’re offering them because stress costs employers $190 billion per year because employees burn out and quit,” she said.
Welnys makes it easy for companies to offer and customize their onsite wellness programs. The startup has a network of over 600 pre-vetted health and wellness vendors, from ergonomic assessment specialists to nutritionists. The platform matches those vendors to companies that want their services.
“We then give those companies a suite of free tools that we’ve developed in-house. This is live today,” she said. “These tools provide a portal for their employees to log in and see all of their wellness programs at their company location. They can book, schedule, wait-list and pay for those classes. And then we aggregate that data and share it back to the employer so that they can start to measure the ROI [return on investment], particularly around participation and engagement.”
Welnys booked about $80,000 in revenue in 2017, its launch year. “This year, our run rate is already over $200,000” Waibel said. “Our goal is to get to $1 million this year.”
One questioner in the audience asked whether employers were willing to sign long-term contracts, and Waibel said that they were. Engagement was on the mind of another questioner, and Waibel responded, “In smaller companies, I find in order to get that engagement number up, it’s best for us to help survey employees in advance, so that we’re offering the programs that they want.” She said that people would be surprised how often companies just pick a menu out of thin air, without figuring out what the employees want.
Chan then asked her why, instead of selling the Welnys program to HR departments, Waibel had mentioned selling it to office managers. She explained that it depends on the company, but the office manager is often the “low hanging fruit, the easiest sell from the sales cycle.” She noted that once Welnys is in a couple of offices in a company, it can go back to the global headquarters and ask them to include Welnys in all of the company’s offices.
Represented at the event by cofounders Lynn Browne and Mollie Kehoe, BrandVerge is a platform that digital advertisers can use to access, discover, activate and manage premium marketing programs.
The cofounders explained that premium marketing programs are arrangements under which, for example, United Airlines would pay the New York Times for a custom article. Browne noted that the market opportunity is large. The native digital investment space will reach $28 billion in 2018, she said, with a steady growth of 38 percent year over year.
“The problem is that ads in this area continue to grow steadily year over year, but there is not a process that is streamlined enough to sustain that growth,” Browne said. “Currently, the process is very manual and arduous. It takes months from discovery into evaluation and finally executing these programs.”
Kehoe added, “The platform takes this ten-step three-year process and drills it down to two steps, where we can really provide these programs and activate them the moment you want to.” She noted that the reaction to the platform has been positive, and that the cofounders have “created a space” that changes the way advertising partners work together on premium programs.
“We’ve identified two business models. For publishers, it’s going to be a simple subscription fee. For marketers, it’s a freemium model,” Kehoe explained. The startup is keeping metrics on how active the platform is, to make sure it is delivering value. It has already raised $100,000 and is trying to raise $500,000 more to get them through the next 12 months and launch version two of the product.
Audience members asked about how BrandVerge differentiated itself from the competition, and they wanted details about the demo version already on the market. Browne replied that the cofounders are testing the demo version with people they know in the industry, to make sure it is intuitive and doesn’t require much training to use.
Most of the panel members said that they didn’t have much experience with this kind of advertising. Spivack said that it would have been helpful to show a mockup during the pitch of what the platform looks like, so people would know right away that it’s a website, and not a mobile app. He told the two cofounders that would be “great to clarify that the product is in beta, and … show your process from migrating it from beta to launch to acceptance.”
The cofounders of 1Degree, Maximilian Huc and Samuel Boochever, gave an amusing presentation about their business, which enables people who want to meet celebrities and influencers to connect with them. It’s a simple idea, they said. “We wanted to create an application that would really break down the barriers between celebrities and their fans,” Huc told the audience.
Celebrities can create a live auction and watch their fans bid against one another for the opportunity to “FaceTime” with them; or they can or indicate their availability and simply sit back and review the FaceTime offers from fans. After the chat, they can keep the fan’s payment or donate it to charity.
“We’ve onboarded at this particular point in time slightly over 400-plus influencers with a social reach of over 45 million. We have 13,000 downloads. We’ve had 300 successful paid chats with an average bid of $3 to $4. And we see users coming back to the app for more,” Huc told the audience.
He noted that influencers are posting these opportunities to chat on their own social platforms at “zero cost to 1Degree.” And he added, “This is uber important because we’re really counting on them to drive their own user demand to the application.”
The addressable market is huge, Boochever said. “You guys are probably thinking of the Kobe Bryants, LeBron Jameses, the Taylor Swifts of the world. But our sweet spot is actually the long-tail-listers, the B-, the C-, the D-listers, the digital influencers that have 100,000 followers, but really have a dedicated following that would want to talk to them.”
Boochever said that 1Degree is the first platform that allows for live, spontaneous, one-on-one interaction between influencers and their fans. “And one of our core advantages is that we’re one of the only applications in the App Store that does live bidding for in-app services.” The app takes 20 percent of every chat that takes place on the platform and, “We are generating revenue today,” Boochever noted.
A member of the audience, T.J. Pingitore, founder of Student Success University (Red Bank), asked the cofounders if there was one group or event they wanted to attend to promote 1Degree. “To answer your question, we need to be at every Comic-Con, at every South by Southwest, at the NBA All-Star Game,” said Boochever. “We need to be at all these events. We see the biggest ROI at these particular gatherings.”
Tropper told the founders that they had great energy and that the video they presented was fantastic. “I think having a video in your presentation really explains a lot, and you get a lot of impact in a shorter amount of time.”
BullPen events always include a student contestant, and this time it was Rutgers-based SULIS, which stands for “solar ultraviolet light-induced sterilization.” Presenting for SULIS were Sarah Pomeranz and Ari Mendelow.
“What we want to do is provide people who don’t have access to sterile water the ability to sterilize the water that they do have,” Mendelow told the audience. The company is targeting those living in developing regions or who are affected by natural disasters. Their device would sterilize enough water for all uses during an entire day, he said.
It consists of a central container filled with water. Inside the container is a photocatalyst insert, and the device is surrounded by a reflective array. The sun reflects off the array into the water and reacts with the photocatalyst to sterilize the water, eliminating bacteria and pathogens.
Questioners from the audience wanted to know how the students differentiate their product from others on the market, and how they would get the money to manufacture and distribute this item. “Part of our business model is that in the long run we’d like to be able to manufacture it locally,” Pomeranz said.
The panelists gave the students feedback on their presentation, with Ossa advising them to include a slide with a grid chart comparing them to their competitors on such points as the selling price of the item and how often the filters would need replacing.