David Leeds, Tango Card CEO. (Tango Card Photo) startup journey is making a return to Seattle. Founded back in 1997, GiftCertificates.com was one of the earliest gift card resellers in the market. The company relocated its headquarters from Seattle to Omaha . But now it has a new owner: Seattle-based , which announced the acquisition of GiftCertificates.com on Tuesday. Tango Card, which helps companies provide digital rewards, will establish a third office in Omaha and add 30 employees from GiftCertificates.com, which has more than 1,000 customers. The combined company will have 130 employees and more than 3,000 customers. GiftCertificates.com was previously in 2010 by Marlin Equity Partners. Tango Card also announced an additional $10 million investment from FTV Capital, which this past May. “As we got to know the team at GiftCertificates.com, we recognized the same commercial and customer focus,” Tango Card CEO David Leeds said in a statement. “We believe that together and with the backing of FTV we’ll be able to continue creating value for our customers while also being able to grow and influence the incentive industry.” Tango Card’s platform consists of three main ways to deliver rewards. Its “” API allows companies to integrate digital rewards directly into their apps and platforms. allow users to fund a gift card account, build an email template and send out digital gift cards. lets the customer send out a link for the recipient to pick a gift card or donation of his or her choice. Tango Card, which ranks No. 71 on the index of privately held Pacific Northwest tech startups, partners with more than 200 retailers, such as Amazon and Best Buy, in addition to restaurants, movie theaters and others. Tango Card also supports donations to 30 nonprofits, such as Habitat for Humanity, American Cancer Society and Girls Who Code. Editor’s note: This post was updated to reflect that Tango Card raised an additional $10 million from FTV Capital.
David Leeds, Tango Card CEO. (Tango Card Photo) startup journey is making a return to Seattle. Founded back in 1997, GiftCertificates.com was one of the earliest gift card resellers in the market. The company relocated its headquarters from Seattle to Omaha . But now it has a new owner: Seattle-based , which announced the acquisition of GiftCertificates.com on Tuesday. Tango Card, which helps companies provide digital rewards, will establish a third office in Omaha and add 30 employees from GiftCertificates.com, which has more than 1,000 customers. The combined company will have 130 employees and more than 3,000 customers. GiftCertificates.com was previously in 2010 by Marlin Equity Partners. Tango Card also announced an additional $15 million investment from FTV Capital, which this past May. “As we got to know the team at GiftCertificates.com, we recognized the same commercial and customer focus,” Tango Card CEO David Leeds said in a statement. “We believe that together and with the backing of FTV we’ll be able to continue creating value for our customers while also being able to grow and influence the incentive industry.” Tango Card’s platform consists of three main ways to deliver rewards. Its “” API allows companies to integrate digital rewards directly into their apps and platforms. allow users to fund a gift card account, build an email template and send out digital gift cards. lets the customer send out a link for the recipient to pick a gift card or donation of his or her choice. Tango Card, which ranks No. 71 on the index of privately held Pacific Northwest tech startups, partners with more than 200 retailers, such as Amazon and Best Buy, in addition to restaurants, movie theaters and others. Tango Card also supports donations to 30 nonprofits, such as Habitat for Humanity, American Cancer Society and Girls Who Code.
Team Tenta Browser. (Tenta Browser Photo) The founders of Seattle startup want to help banish your digital doppelganger. Or least take control of it. People’s behavior online these days “is not just about sharing your cat videos and family photos. You’re having this long digital shadow,” said Tenta co-founder and CEO . “People are starting to realize this is my own digital clone, and it’s betraying me and it’s following me.” Tech companies and retailers are collecting vast amounts of information about what you view, buy and post online. They can use that data to target ads and news content and if their systems are breached, that personal data falls into criminal hands. Governments in numerous countries such as China, Russia, Turkey and many others that’s available online. So in 2016, Adams and co-founders , chief operating officer, and chief technology officer, launched Tenta, a secure browser that protects privacy and can skirt censorship controls. The company has 100,000 active users, 16 employees and recently raised seed funding (they’re not disclosing the amount). A decade ago, the trio co-founded the popular adult-content app store MiKandi, which is billed as the first and largest app store of its kind — and an enterprise in which privacy protections are paramount to most users. Tenta Browser CEO and co-founder Jesse Adams. (Tenta Browser Photo) Tenta Browser prevents internet service providers (ISPs) and others from seeing which websites a user visits, but is just as easy to use and as fast loading as other browsers, Adams said. Tenta, which is currently available as an app for Android users, encrypts everything: browsing history, downloaded and local files, bookmarks, videos, documents and other media. And for people who like to keep their browsing sessions separate, say for work, personal use and depending on where they’re currently located, Tenta has a “zone” function to organize different uses. Tenta doesn’t store users’ data, and all of the information is decentralized. Competition includes browsers that are basically “Chrome reskinned” with limited privacy blockers, Tor Browser for more “hardcore” users, and tools from Norton and McAffee, said Adams. Opera used to utilize a VPN-based tool like Tenta’s, but removed it. Over the next year, the Tenta team is working to expand to other devices and keep improving their speed. With Tenta, the core browsing function is free, and the company offers subscriptions of $1 to $5 per month for added protection of your devices. Adams said they’re aiming for subscriptions that are as cheap as possible, but people still need to pay something. That’s because Tenta doesn’t follow the more standard approach where handing over personal data is the price for using “free” services. “You are not the product,” he said. We caught up with Adams — who co-founded the MiKandi app store for adults — for this . Explain what you do so our parents can understand it: Today’s browsers need your data to survive, resulting in constant privacy violations and browser spying. Tenta is a crypto browser that takes the complete opposite approach and protects your personal data instead of exploiting it. The Tenta Broswer interface. (Tenta Browser Photo) Inspiration hit us when: Previous to Tenta, we built the world’s first and largest app store for adults. From this experience, we learned three major trends from our customers. First, internet freedom around the world declined for the past eight years, and censorship and network interference were becoming mainstream. Second, cyber security was no longer solvable for the average internet user who craves a simple and trustworthy product to protect them and their families. Finally, constant data collection and surveillance and the resulting massive data breaches revealed that privacy violations have become the norm. In response, we began building browser tools to help our customers alleviate these issues, but soon realized we were just creating more browser Band-Aids. Then the inspiration came when one of us posed the question: “Why not build a better browser instead?” We know that sounds crazy, but we’ve always been driven by big ideas, so that was the spark that got us going. VC, Angel or Bootstrap: For the first two years, we were self-funded. This past month we announced our strategic partner and investor, , for our first significant seed round. We decided to start raising money once we gained real user traction and growth. We especially wanted to work with ConsenSys, which is focused on blockchain businesses. The decentralized future is coming, so if you’re building the browser of the future, you must partner with the best in the industry. We share the same values and vision. Tenta is the secure gateway to the new internet that will help drive adoption of many blockchain services, so we’re looking forward to deep collaborations with them. Our ‘secret sauce’ is: Our team is awesome. Most of us have been working together for many years on complex, large-scale software, so that gives us an advantage. Having a great team also leads to smarter product decisions. For example, we offer built-in VPN and encrypt all your browsing data by default. That includes your bookmarks, downloaded files, open tab data, domain name system (DNS), online traffic, etc. No other browser in the world does this. Our team figured out early on that this was going to be a real differentiator and the team knew how to execute that strategy. The smartest move we’ve made so far: Deciding to build a strong cryptographic foundation to power the browser. There are many private browsers in the market today, but most are glorified incognito browsers with an ad blocker attached. These do nothing to keep you invisible or protect your data. We decided early to go all-in on building a private browser and that meant redesigning many components that our competitors ignored. It also meant that it took us longer to get off the ground, so there were times we thought “maybe we’re going too hardcore with this privacy thing and no one cares.” Now that early decision is the reason why we’re gaining momentum with amazing customer reviews, which in turn helped secure our funding. The biggest mistake we’ve made so far: Drastically changing the browser user interface (UI) when we first launched. You might be lucky to create an app design that is totally new and that people love right away, but that’s extremely rare. With software, it’s often better to iterate and improve on existing experiences. We got too excited with the idea of building a new type of browser and went overboard. We re-learned that lesson the hard way, wasting precious time simplifying the UI. Tenta co-founders Chris O’Connell, Jesse Adams, and Jen McEwen. (Tenta Browser Photo) Which entrepreneur or executive would you want working in your corner? Elon Musk. He’s actually trying to do something grand for humanity. He’s awe-inspiring. If he can land rockets and take us to Mars, then helping us build the browser of the future should be a piece of cake :) Our favorite team-building activity is: Eating together and sharing a toast. Our team is distributed around the world, so we really enjoy getting together and sharing a meal. Most of us love to cook. I think it’s one of the best ways to build bonds and spark conversation and creativity. The biggest thing we look for when hiring is: We look for people who are passionate about what they do for a living and love learning. We often prefer to just look at a candidate’s personal GitHub repository instead of a resume. If you have no personal projects to share, then I’d argue you’re only coding for the money, not because you enjoy it. That difference matters in a startup. What’s the one piece of advice you’d give to other entrepreneurs just starting out: My advice is to take this quote from Calvin Coolidge to heart: “Nothing in this world can take the place of persistence. Talent will not; nothing is more common than unsuccessful men with talent. Genius will not; unrewarded genius is almost a proverb. Education will not; the world is full of educated derelicts. Persistence and determination alone are omnipotent. The slogan ‘press on’ has solved and always will solve the problems of the human race.”
Health care provider Providence St. Joseph Health acquired Seattle startup , which uses blockchain to collect payments more efficiently. The process of billing and collecting payment, called revenue cycle management, is a common headache for hospitals that has attracted solutions from Athenahealth, Experian Health, GE Healthcare Partners and others. Lumedic CEO Lincoln Popp. (Lumedic photo) Lumedic uses blockchain, the technology behind cryptocurrencies like Bitcoin, to share information between payers and providers on a distributed ledger. Providence said it’s the first integrated health care system to use blockchain for this purpose. By moving what is often a manual process to the blockchain, the companies hope to reduce costs. “New technologies like blockchain, artificial intelligence, and machine learning give us an opportunity to view the complexities of today’s health systems through a different lens,” said Venkat Bhamidipati, Providence St. Joseph Health CFO, in a statement. Renton, Wash.-based Providence, which operates 51 hospitals, has hired the Lumedic team and intends to keep it an independent company that will pursue partnerships with providers, insurers and others. Providence did not disclose how much it paid for the acquisition or other terms of the deal. Lumedic was founded a year ago by Michael Nash, the company’s chief product officer, and is led by CEO Lincoln Popp.
Founders from the Techstars Seattle 2018 cohort after Demo Day last year. (GeekWire Photo / Taylor Soper) The Seattle tech ecosystem has changed plenty in the past decade. New startups have grown or died off; the investment scene looks much different; and hometown tech giants continue to expand their footprint. But one organization has been a mainstay since it launched in 2010, offering a launchpad for early-stage startups to help entrepreneurs turn their ideas into full-blown businesses as part of an evolving tech scene in the Emerald City. today announced its 10th class, marking a milestone for the accelerator that has graduated 100 companies to date. Alumni of the organization — companies such as Remitly, Outreach, Skilljar, Bizible, Leanplum and Zipline — have collectively raised more than $700 million in investment capital. Most have built their startups in the Pacific Northwest, helping expand the entrepreneurial clout in the region. “Staying alive is the hardest thing to do in startup land,” said Techstars Managing Director . “We’ve been around for 10 years and have been lucky to be apart of some really great founder journeys.” Techstars Seattle is part of a larger Techstars network that spans across the globe and also features a Techstars venture capital fund and a . Techstars Seattle is based at Startup Hall at the University of Washington and shares space with the , a separate program co-led by Techstars and Amazon focused around voice technologies. Here are the ten startups in the newest class (Demo Day is set for May 7 in Seattle), with descriptions from Techstars, which provides $120,000 in funding in exchange for 6 percent common stock as part of the three-month accelerator. Continue reading for a Q&A with DeVore as he reflects on the longevity of Techstars Seattle and dishes on how the Seattle tech scene has changed. (Seattle) — interactive, customized machine learning training for industry engineers. (Seattle)— testing automation for complex SaaS tech stacks, made simple. (Denver)— identity & consumer intelligence for Asia-Pacific, built on Blockchain. (Cambridge)— augmenting the human brain with always-on personal assistants. Level — transforming access to credit and savings for the underbanked. (Miami)— customer experience platform for the $1 trillion freight forwarding industry. (Seattle) — access to the decentralized future. (Bay Area)— adding real-time intelligence to online communications. (Austin)— meeting familiar strangers. (Seattle)— the YouTube of AR content. Editor’s note: Interview edited for brevity and clarity. GeekWire: Thanks for chatting with us, Chris. It’s pretty cool Techstars Seattle launched 10 years ago and is still going strong. Chris DeVore: When we started out, the idea for an accelerator was kind of a new thing. Y Combinator started in 2005 and Techstars in 2007. We were the third version of Techstars — first Boulder, then Boston, then Seattle. Now there are hundreds of accelerators around the world and the speciation around the idea has gotten pretty tense. As the noise has grown, it’s been about figuring out what you are uniquely good at. Part of what that comes down to — and a lot of this is why we’re so focused on the role we play in the community — is that Seattle is uniquely excellent at a handful of things. It hangs off our anchor tenant companies and the University of Washington. It’s cloud infrastructure; e-commerce marketplaces; enterprise software; and things powered by data and machine learning. There’s also stuff around the edges — space and aerospace, digital health. That’s sort of the learning over the past 10 years. Just being an accelerator is not good enough. Just being a Techstars accelerator is not good enough. So what can we, in Seattle and the Pacific Northwest, do better than anyone else and how do we make that a promise that if you come to Techstars in one of these vectors, we’re going to give you an unfair advantage — not just regionally but globally. That’s the wheel we’ve been trying to spin. Techstars Seattle Managing Director Chris Devore. (GeekWire File Photo) GeekWire: When you say Seattle is uniquely excellent at certain things — what does that mean, and why does that matter? How does it help entrepreneurs? DeVore: As a founder-centric investor, all you’re really betting on is people. The combination of real domain expertise and enthusiasm for solving problems is the kernel of the founder. Despite the stereotypes, research shows that the highest-performing companies aren’t founded by 20-something kids right out of college. They are founded by people who’ve been in the trenches for a while and learned something about business, about the world, about problems. The kinds of problems in our ecosystem that gets people up to speed on tends to be about how software changes the world of work for developers or business professionals or somewhere in between. Amazon and Microsoft have helped attract amazingly talented people to the region from around the world who have a passion and expertise for those problems. If you look at the mentors and investors who make it work, they also came up often through those pathways. They were founders or they spent 20 years working on enterprise software at Microsoft. Their pattern recognition around what good looks like was hardened at some of the institutions that are producing founders. It’s a group of people that understands each other and communicates clearly and has a lot of built-in trust because they share a cultural foundation and passion for those kinds of problems. GeekWire: There have been so many accelerators and incubators and similar organizations popping up in recent years. How has Techstars Seattle kept it going for so long? What is the secret sauce? DeVore: Staying alive is the hardest thing to do in startup land. We’ve been around for 10 years and have been lucky to be apart of some really great founder journeys. We’ve built a community of founders who are themselves really successful, but who are also grateful for the role Techstars played in their success. They give back. They refer companies to us; they come and speak; they mentor. So over ten years, you build this incredible network of people who feel emotionally connected to the brand and community. I keep thinking about the flywheel — the compounding effect of surviving and thriving and playing a role in great people’s success, that keeps coming back to you in positive ways. GeekWire: You’ve been in a unique spot over the past ten years, launching an early-stage venture capital firm in 2008 (Founders Co-op) and then taking over as Techstars Seattle managing director in 2014. How have you seen the Seattle tech scene change? Is Seattle a better or worse place for a founder now? DeVore: There are two narratives. The first is business related. We got super lucky that Jeff Bezos decided to build his company here in downtown Seattle and is scaling headcount faster than I’ve ever seen. The magnetic pull of a high performing company for high performing people into the urban core across a broad range of dozens of businesses has been a massive injection of talent and energy to the Seattle urban core. Then, after what felt like a lost decade in the Ballmer years, Satya has done a similar thing with Microsoft. It felt pretty moribund, the Boeing 2.0 — the Lazy M instead of the Lazy B. Microsoft has become a more exciting and more fun place to work. Those two things have been incredible. That’s the rising tide that has lifted the boat of the entire region economically from a talent standpoint and and urban standpoint. The second narrative is around the livability of Seattle. When you look at the Bay Area, they have politically failed to deal with issues around growth and transit and housing. Seattle hasn’t gotten it right every time, but at the margin, when pushed, taxpayers and civic leaders have said ‘we really do need build a light rail system,’ or, ‘we really need to reconsider how we zone for scale and allow more housing to grow.’ So as the Bay Area has choked on its own growth, Seattle has made it possible to continue to grow and not price out absolutely everybody. Do we have work to do? Of course. Homelessness is a huge issue. But it’s hard to build a great city for work if it’s not a great city also to live in. Seattle leaders have done a good job of saying, ‘we need to do stuff to make this city a great place to live for everyone and not just a great place to make money.’ I think that’s an underreported narrative about why Seattle is winning more and more as an economic center. It’s because we’re doing stuff at the margins to make it a place that works for families and works for transportation. The partnership between business and civic leaders and taxpayers is what will set up the next 20 years of growth. Sunset over the Seattle skyline. (GeekWire Photo / Kevin Lisota) GeekWire: With all that talent rushing into the ecosystem, you’d think Seattle would turn into a startup factory. But that hasn’t been the case. Why not? DeVore: We are still wrestling with what I call a company town mentality. Most people didn’t come here out of school to start a startup. They go to New York City or San Francisco. Seattle is a place where people who already have a career come to further their career. And if you work at Amazon or Microsoft, you’ve had a great run and have a bunch of stock that is worth more every year. Not only is it a great place to get a job, but it’s a great place to keep a job because the companies here are succeeding. We still struggle with Seattle as a place where entrepreneurially-minded people choose to be, as opposed to just talented people who work in tech. The only way you turn the crank on that is to get more great companies that scale and raise money and go public here. We’ve had increasing success at getting companies to be founded here by folks who moved here to work for Microsoft and scaled their own companies and made themselves and their early employees really rich. That’s the story of how you get people out of an employee seat and into the founder seat. Our velocity is slowly increasing there but we’re still much more of a company town than some of the other major tech cities. I believe founders are people who don’t fit in the corporate world. Some people realize that sooner than later. Sometimes the golden handcuffs make it harder to unwind. But most founders realize they aren’t happy working for other people. In any population, that’s going be a small percentage. With more population of talent, the higher the number of potential founders. But it’s always going to be a tiny slice. Most people are happier having a job. GeekWire: With Techstars Seattle specifically, what have you seen change over the years? DeVore: Getting money into good companies has become easier in the Pacific Northwest. It used to be hard to find $1 million for a startup coming out of Techstars because there wasn’t a lot of angel money in the ecosystem and almost no institutional capital for seed-stage companies. In the last ten years, there’s been this explosion of micro-VC firms, particularly in the Bay Area, . We’ve had increasing success at getting out of town seed investors to commit real money into this ecosystem. Getting $1 or $2 million for a great startup is a lot easier than it used to be. The thing that’s gotten harder — or that we chose to make harder — is the realization of how lopsided the demographics of venture-backed founders have been. Companies aren’t just founded by white and Asian men. There are lots of founders who are women or African-American. Somehow we as a system need to think harder about how we’re sourcing and how we support founders from different kinds of backgrounds. It’s about challenging ourselves as a community and looking at the reasons for why we’re not being attractive to founders who look different. How do we open our doors and build relationships and change the narrative so that founders from different backgrounds see themselves in our work and vice versa? We agree with the consensus view, that it’s really important as investors who are trying to make change in the world, to figure out how to make change in your industry. . It’s a challenge we set for ourselves in the last few years that is a new kind of risk we’re trying to take and new type of innovation we’re trying to pursue with the platform as we mature. Seattle entrepreneur Andy Sack (left) stepped down as managing director of Techstars Seattle in 2014, passing the torch to Chris DeVore, his longtime business partner and co-investor at Founder’s Co-op. (GeekWire File Photo) GeekWire: What’s your pitch to founders? Why should an entrepreneur go through Techstars Seattle? DeVore: In general, we’ve seen businesses that are further along and founders who are more experienced join our platform over time. We’ve been able to progressively attract more and more experienced founders. They have more options, yet they choose to work with us. It is the realization that there are lots of things about building a business besides raising money that are important and needed. Founders who can self-assess their strengths and weaknesses and say, ‘hey, if I can find a hack in 12 weeks that super saturates my network in an area of weakness, how much is that worth to me? Is it a couple points of equity to transform in a positive way or mitigate a risk in a powerful way by accessing the Techstars network in Seattle?’ Founders who come to that conclusion are the ones who opt in to the program. The ones who say ‘I got this, I don’t need any help, all I need is money,” are probably not the right fit for what we do anyways. GeekWire: What do you think about the ? DeVore: It’s a super healthy push for clarity. We say ‘no’ all the time to founders — not because we don’t like what they are working on, but we don’t think their business is a fit for venture. The venture model wants one thing and one thing only, which is dominance and hyper-growth in a new category of innovation. And 99.9 percent of all startups do not fit that description. Broadly, the media narrative around startups makes it feel like every business that’s successful is a venture-backed business. There are tons of super successful businesses and make a ton of money for their founders and principals that never take outside funding. But the only thing I find wrong [about the discussion] is the idea that venture is trying to talk people into taking their money and they shouldn’t. I don’t think that’s ever been true. Good venture capitalists are very clear about what the model is good for and what it’s not good for, which is why they say no so often. They don’t want to be part of a business that’s not going to grow super fast and generate a liquidity outcome for everyone in 10 years. So anyone who thinks venture is somehow trying to get people, in a predatory way, to take money from businesses that shouldn’t doesn’t understand the economics and incentives in venture. GeekWire: You’ve seen thousands of pitches. Any learnings with how you invest or what you’re looking for? DeVore: Every time I’ve screwed up as an investor, I’ve fallen in love with an idea and used that as an excuse to overlook shortcomings in the founding team. When I really sit back and ask myself why I lost money on a deal, it’s because I knew there were things about my preferences around what founders I like to work with that were misaligned, but I ignored that because I was so excited about the idea they were working on. I keep coming back to the same thing. If I choose amazing people that are working in some direction that I think has economic merit, scale, and disruptive potential, those founders will find a way to make it work. is one of my favorite stories. The business they set out to build wasn’t working, but because they stuck together as a founding team and kept adapting and learning, they figured out how to find a productive thing. But that wasn’t because of where they started or the early metrics. It was because as humans, they were so committed and resilient and so gritty that they figured it out. And that’s really what you’re betting on. It’s a 10-year journey and it’s never always up and to the right. There are always setbacks and near-death moments. It’s the human capacity for resilience and persistence every time that will turn a bad investment into a good one.
(Atomo Image) Andy Kleitsch was pacing, sipping and talking rapidly during a phone conversation on Thursday morning. The Seattle entrepreneur had had multiple cups of coffee already — and he’d just aimed at upending what we think we know and love about the beverage. and are the co-founders of Atomo, a startup that claims to have “hacked the coffee bean,” in so much as they’ve removed it from the process of making coffee and substituted it with a molecular concoction derived from naturally sustainable (and secret) ingredients. Kleitsch is a tech vert who once worked at Amazon among other places, and he currently leads entrepreneur workshops at the University of Washington. He started looking for his “next thing” about six months ago and reached out to friends in Seattle. Atomo co-founders Andy Kleitsch, left, and Jarret Stopforth. (LinkedIn Photos) “I got all kinds of great ideas,” Kleitsch said. “I heard ideas around firefighting robots and all kinds of things. But Jarret said, ‘I want to make coffee without the bean.’ And that was just too good. It blew my mind.” Stopforth is a Ph.D. with extensive experience around food safety and quality at companies such as Chobani and Campbell Soup. “I love coffee, but every day I was adding cream and sugar to mask coffee’s bitter flavor” Stopforth said. “By replicating the taste, aroma and mouthfeel of coffee, we’ve designed a better tasting coffee that’s also better for the environment.” The sustainability element of Atomo’s mission is driven by the belief that regions where beans are grown will be greatly impacted in the coming years. The company points to a last month that said “60 percent of the world’s coffee species were in danger of going extinct in the next 50 years due to climate change, population expansion, and disease.” Atomo promises that its ground coffee will be suitable for drip machines, French presses, refillable K-Cups, and pour-overs. The grounds will be made of a non-allergen, Kleitsch said. “It’s not going to be made out of peanut shells,” he said. “What we’re really excited to do is find a material that we can upcycle — naturally occurring ingredient that is probably a spent item, that is usually thrown away from a different food process and give it life again.” Disrupting something that is so near and dear to the tastebuds and culture of so many people, and doing it in a coffee capital like Seattle, is a big deal. Atomo could simply create a liquid product without worrying about the grounds and consumer’s brew habits. But the five-person company is made up of coffee lovers who respect all that goes into being addicted to the stuff. “People’s coffee ritual is very important to them and it’s something they do every morning,” Kleitsch said. “And so we want to fit into that ritual, we want to be a part of that, and that’s why we’re coming up with the grounds. So they can just replace [their current coffee] one for one.” A video shot on campus at UW shows Atomo going head to head in a taste test against another certain Seattle coffee company: Atomo has set a goal of $10,000 on Kickstarter, with a deadline of March 9. The crowd-sourced funds will be used to further development. The team is partnering with Mattson, a food tech company, and is bootstrapped right now, with eventual plans to seek investors. Kleitsch said no one else is trying to build coffee from the molecular level up. The closest thing might be coffee without the black color. A company called Endless West does make molecular whiskey, and Kleitsch points to the , makers of a plant-based burger that “bleeds.” When told that maybe Gates would like coffee without the bean, Kleitsch said, “I hope he does!”
(GeekWire Photo / Nat Levy) Seattle-based tax compliance company Avalara has acquired Indix, a Seattle startup that had accumulated vast amounts of data on product information. Indix CEO Sanjay Parthasarathy. (Indix Photo) Avalara, which went public this past June year, will use Indix technology to bolster its tax content database that includes everything from international product codes and classifications to taxability rules. “We believe the combination of deep product knowledge, broad product content, and artificial intelligence technology will allow us to provide our customers the information they want and need to factor compliance into their business decision-making, and for Avalara to address more compliance requirements to support their growth,” Avalara CEO Scott McFarlane said in a statement. Founded in 2013 by former longtime Microsoft executive , Indix developed an intelligence platform that helps businesses analyze and visualize product information across various industries. The company had raised more than $30 million from investors. “From day one, we built Indix to collect, organize, and structure the world’s product information using artificial intelligence,” Parthasarathy said in a statement. “With the addition of the Indix expertise, Avalara will be able to efficiently and rapidly refine its content to meet the expanding and evolving needs of its customers.” Parthasarathy is well known in Microsoft circles. He into the tech giant’s product group in the early 1990s. The Indix homepage now redirects to Avalara’s site. We’ve followed up with Avalara and Indix for more details about the acquisition and will update this post when we hear back. Last month Avalara Compli, a California-based company that helps makers of alcoholic beverages comply with government rules and regulations. Avalara has grown to more than 1,500 employees across 12 offices around the world. Avalara a net loss of $9 million on revenue of $69.5 million for the third quarter. Its stock is down about 10 percent from its IPO price. The company will report fourth quarter earnings next week.
KenSci co-founders Ankur Teredesai (left) and Samir Manjure. (KenSci Photo) has raised an additional $22 million to fuel growth of its machine learning and AI-powered technology that helps health systems predict when patients will get sick and lower healthcare costs. Polaris Partners led the Series B round, which included participation from existing investors such as Ignition Partners, Osage University Partners, and Mindset Ventures. UL Ventures also joined the round as a strategic investor. Total funding to date is $30 million. Founded in 2015 by two childhood friends — , a longtime former Microsoft exec, and UW professor — KenSci’s software aggregates patient data from a number of existing sources, including data collected from patient devices, electronic medical records, and public records. The platform then assembles the data so its machine learning systems can use it to predict clinical, operational and financial risks. KenSci’s customers include Fullerton Health, St. Luke’s Health Partners, Evergreen Health, and others. “In the last two years, we’ve singularly invested ourselves in building a platform that simplifies the way health systems look at their data and gain actionable, predictive insights to save lives and costs,” Manjure said in a statement. “With this round of funding, we’re excited to take these capabilities to a global stage with partners who complement our capabilities and are committed to helping us drive this transformation across the care continuum.” Healthcare spending in the U.S. increased 3.9 percent in 2017 to $3.5 trillion, according to . KenSci appeared on last year, pitching its business to a group of judges. The company, which employs more than 50 people and has additional offices in Singapore and Hyderabad, was also nominated for the Innovation of the Year category at the . “If you can predict, then you can potentially prevent — and not only that, but you can make better outcomes happen and reduce cost,” Manjure said in his pitch, which you can watch below.
Paul Stahura. (Donuts Photo) Cryptocurrency has yet to catch on with mainstream consumers, in large part due to its volatility. Bitcoin, for example, went from $900 in December 2016 to nearly $20,000 one year later, before dropping back down to less than $4,000 this past December. Now some entrepreneurs have come up with a potential solution: stablecoin, a newer form of cryptocurrency that is pegged to a fiat currency such as the U.S. dollar and allows prices to remain more stable. The idea has caught the attention of , co-founder of domain registrar companies such as Donuts and eNom. He’s leading a $1.2 million round in Seattle startup , which today announced the Series A investment. Stably has developed its own stablecoin called StableUSD (USDS). When a user gives Stably $1 to buy its cryptocurrency, it mints one of its digital tokens. If someone gives Stably back that 1 USDS, it removes the coin from circulation and returns $1 from its cash reserve. The idea is to provide benefits of cryptocurrency — fast transaction speed; anonymity; etc. — with less fluctuation in value. Stably CEO Kory Hoang. (Stably Photo) “We’re simply turning dollars into digital dollars,” said CEO . Stahura, who co-founded Donuts in 2010 and remains chairman at the Seattle area company, said he sees many parallels between cryptocurrency — specifically dollar-backed tokens — and domain names. He said there was room for many companies such as eNom or GoDaddy who were selling the exact same product (.com names). “Same with dollar-backed tokens,” Stahura told GeekWire. “How hard can it be to sell a dollar for $1, especially if that dollar has more utility and lower fees, say, than a credit-card dollar?” Stahura pointed to , a startup backed by big-name investors such as Andreessen Horowitz and Founders Fund that recently passed $200 million in market capitalization for its stablecoin TrueUSD. “I invested because of the sort of familiar opportunity I see, plus I like the energetic and experienced team,” Stahura said. Hoang said that the most immediate use case of stablecoins is as a medium of exchange and a store of value for cryptocurrency traders. “Many exchanges don’t let you easily convert between cryptocurrency and traditional fiat currency,” he said in an email. “A cryptocurrency that has the same value as fiat (i.e. a stablecoin) fixes that, and gives traders more control over their investments, especially in times of volatility.” Hoang, who was previously an analyst at PitchBook, added that the long-term vision is to “enable fast and borderless payments, an efficient and cheaper solution for remittance, and a reliable alternative to money in developing or hyper-inflationary economies.” “The world that stablecoins can enable is one where you can buy a cup of coffee with cryptocurrency,” he said. Stably makes “flat income” on the cash reserve it holds that backs the USDS coins. The company employs nine people and expects to grow as a result of the funding. Other backers include 500 Startups, Beenext, and angel investors. Total funding to date is $1.7 million.
The Smith family takes a break from their entrepreneurial ventures to go on vacation. (Photo courtesy of the Smith family) Soojung Smith thought entrepreneurship was a grownup pursuit. Then her sons schooled her. The up-and-coming Generation Z-cohort that includes her two boys, “tend to be more independent minded and have seen the success of starting a business from social media and their icons,” Smith said. “And they have less fear. They’re like, ‘Hey, I want to try this.’” And that’s just what they’re doing. Soojung and her 17-year-old son Douglas are co-CEO of , a Bellevue-based education startup. Her 12-year-old Jonathan works on technology for the company. All three are co-founders, and the boys’ dad, Doug, is their advisor as well as a business development executive at Microsoft. They launched KuriousMinds last year. Their first effort is a program called Young Sharks that’s focused on teaching kids the fundamentals of starting a business, including building a business plan and pitching it in front of a simulated panel of investors. “There is no shortage of ideas,” Smith said. “But whittling them down to something meaningful that will really bring value to their intended audience, that is something that they really struggle with.” The program targets kids in later elementary years and middle school — a sweet spot where there are few options for young entrepreneurs, Smith said. Her sons have additional ventures already under their belts. Douglas launched a tutoring business in eighth grade, and Jonathan has created two aquarium products: a filter diffuser showcased at the 2016 and an automatic fish feeder with AI integration that he’ll debut at this year’s fair. Soojung Smith has worked as a product and marketing executive at Dr Pepper/7 Up, Anheuser-Busch, AT&T and Microsoft where she helped incubate new products and businesses. Smith said that Douglas plays a key role in developing curriculum for Young Sharks and figuring out which digital tools are best suited to the students. Soojung and Douglas co-teach the program. They collaborate well, she said — at least most of the time. “We’re family. We are very passionate individuals. He gets passionate and I get passionate and sometimes we need a time out,” Smith said. “And sometimes my husband jumps in and serves as a referee.” We caught up with Smith for this Mother’s Day edition of Startup Spotlight, a regular GeekWire feature. Continue reading for her answers to our questionnaire. Explain what you do so our parents can understand it: “We are on a mission to help enable Generation Z to become a generation of confident future entrepreneurs.” Inspiration hit us when: “I’ve always had a dream of building something impactful and long lasting as a family.” Soojung and Douglas Smith, the mother-son co-CEOs of KuriousMinds. (Kurious Minds Photo) VC, Angel or Bootstrap: “We are an entirely self-funded, bootstrapped business. Client work in education coaching is funding our work for the design and delivery of the Young Sharks program. This is our second startup, and we are determined to build a solid foundation by growing at a measured pace.” Our ‘secret sauce’ is: “The deep involvement of our kids provides us with a unique view into effective learning styles for this generation. In addition, we are building an active local community of mentors and coaches with domain expertise who can guide and support young student entrepreneurs.” The smartest move we’ve made so far: “Working with partners in the community is integral to our success. We deliver our project-based experiential entrepreneurship program in partnership with city governments, educational institutions, homeschool co-ops and camp organizers with the programs tailored to the student profiles for their communities.” The biggest mistake we’ve made so far: “Building a business as a family comes with both opportunities and challenges. Trust, loyalty and shared values are the ones that glue us together. Of course, there are challenges when stress and pressure from the business side sometimes spill over into family relationships. We have learned to leverage each other’s strengths to get the benefit of operating as a family while minimizing the stress.” Would you rather have Gates, Zuckerberg or Bezos in your corner: “Bill Gates because he is such an inspiration to everyone not only for his business success, but, more importantly, his philanthropic work to provide opportunities through education. His work in this area speaks to us most in terms of who we’d most want to back our endeavors. We admire Bill and Melinda’s commitment to impacting the lives of others and investing in a better world.” Our favorite team-building activity is: “Cooking as a family. We try to improvise and create our favorite dishes including crossovers between Korean and Mexican food.” The biggest thing we look for when hiring is: “We look for curiosity, creativity, passion for entrepreneurship, empathy and strong success in working and connecting with kids.” What’s the one piece of advice you’d give to other entrepreneurs just starting out: “Ideas on a piece of paper without sufficient experimentation won’t help you to build a business. Planning is critical, but implementation is king. Be proactive about learning from your customers, partners, competitors and everyone around you. Be gracious about receiving feedback from them.”
We’re on the scene at MoPOP in Seattle for the 10th anniversary of the presented by Wave Business, where we’ll recognize Pacific Northwest innovators in 13 categories — including Deal of the Year, Startup of the Year, Innovation of the Year, CEO of the Year, and many more. If you’re one of the more than 900 people attending the event this year, . For everyone else, we’ll be live-streaming highlights from the red carpet starting around 6:45 p.m. Pacific time, in the video player above. Then join us starting around 8:10 p.m. for the festivities on the main stage, in the player below, as we reveal the winners and deliver a few surprises along the way. Check out all the finalists via the links below, follow along on social media at , and check back on GeekWire later tonight for a full rundown of the winners.
Merit CEO and co-founder Adil Wali. (Photo via Merit) You’ve probably read or heard about cryptocurrency in the news. Maybe your techie friend owns some Bitcoin. But you likely don’t own any digital currencies or let alone know how to obtain them in the first place. is on a mission to change that. Led by , a veteran entrepreneur who previously co-founded ModCloth (acquired by Walmart last year), the Seattle startup today unveiled its invite-only cryptocurrency called MRT. Wali helped come up with the idea for Merit after he and his co-founder wondered why so few people — even those within the tech industry — actually own cryptocurrency. They concluded that it was a problem around usability and accessibility. “If you want to create the world’s most-used cryptocurrency, what do you do? You have to make it simpler, you have to make it safer, and you have to make it a community,” Wali told GeekWire. Simplicity, safety, and community are the pillars of Merit — the third of which is perhaps most important, Wali said. Part of what makes Merit different from other cryptocurrencies, and what helps build community, is the invite-only requirement to obtain and own MRT. Wali explained that the anonymity associated with many existing cryptocurrencies enables hacking and theft too easily. He said Merit enables an “active stewardship model” and can track, across its blockchain, who is bringing in who to the community. Merit also changes the fundamentals of mining, or the process by which cryptocurrency is made via powerful computers. The company has created what Wali calls “proof of growth mining.” Since the service is invite-only, Merit can better assess and control who is rewarded with MRT. “What that enables is folks can actually mine merit without a computer,” Wali said. Another differentiator is how Merit allows its currency to be exchanged between owners. Rather than exchanging long 34-character public key strings, Merit built its own protocol. “We created an escrow on the blockchain that can hold money for you to claim it,” he said. MRT can be created and sent via SMS, Twitter, or various other communication tools. Merit also features decentralized vaults, password-protected transactions, and cancelable transactions. It is launching today without an ICO, as Wali said the company wants the community to determine price. Wali, who sold his most recent startup Fox Commerce to a blockchain commerce company, said his 10-person team is focused on making Merit accessible to just about anyone, regardless of technical knowledge. That feeds into the company’s vision of getting more people owning and using cryptocurrency. “Any currency is only as useful as the number of people who use it. If you can’t transact with it, what’s the point?” he said. “If we have dramatically less than a percent of the world’s population using crypto, it’s a really big problem when you think about the viability of the space at large.” Merit is bootstrapped, with the founders investing an initial $1 million in the company. The business model is split between Merit Labs and a non-profit called the Merit Foundation. A percentage of all MRT distributed goes into a genesis block, which is allocated across the foundation. “The idea of Merit is that with a decentralized launch and a longer-term approach, we are incentivized to make Merit valuable everyday,” Wali said. “With both the non-profit and for-profit, we’ll sell a little bit of Merit over time to continue operations in the organization. As the value of the currency goes up, then we’re able to do that more.” Cryptocurrency remains a hot — yet still relatively misunderstood — area of the startup world. According to PitchBook, 179 venture capital investors in the U.S. in at least one crypto startup deal in the past two years. noted this week that top VC firms Andreessen Horowitz and Union Square Ventures “are increasingly investing in public blockchains and cryptoassets broadly.” this week reported that the parent company of the New York Stock Exchange is working on an online trading platform for Bitcoin. That followed news of Goldman Sachs’ plan to open a Bitcoin trading unit. Some are still skeptical. Speaking on CBS this week, Bill Gates called Bitcoin and ICOs “one of the crazier speculative things.” “As an asset class, you’re not producing anything and so you shouldn’t expect it to go up. It’s kind of a pure ‘greater fool theory’ type investment,” Gates said. “I agree I would short it if there was an easy way to do it.” Gates previously weighed in on the subject during a in which he called cryptocurrencies “super risky.” Merit is one of several cryptocurrency/blockchain-related companies and organizations sprouting up in the Seattle area. There are startups like and a blockchain consulting group called ; and an investment group called that with blockchain company RChain Cooperative to invest a cryptocurrency equivalent of more than $190 million in blockchain apps and startups. “There is just phenomenally great talent here,” said Wali, who re-located to Seattle in 2016. “We have the ability to be one of the epicenters of cryptocurrency.”
(Bigstock Photo)stock Hospitals have to solve a thousand logistical challenges every day, but perhaps none are more difficult than operating room schedules. Surgeries can be difficult to predict — in fact, less than half of surgeries in the U.S. start and end on time. That can create chaos for patients and doctors, and costs hospitals $5.2 billion every year, according to University of Washington . The startup, which develops a variety of technologies for hospitals, is taking aim at the operating room problem with a new AI technology that uses data on patients and surgeons to more accurately predict how long each surgery will take. The startup recently deployed the technology at a large academic medical institution in Seattle. So far, it has cut the number of surgeries that run over their scheduled time by 20 percent, a result that could save a hospital $1 million a year in staff overtime alone. Perimatics Co-Founder and CEO Kalyani Velagapudi. (Perimatics Photo) The startup is still studying how its technology affects underage, or the number of surgeries that end before the predicted time, and other elements including patient and employee satisfaction. Perimatics’ algorithm begins by looking at a patient’s data and seeking out information that will affect how long the surgery takes, like the patient’s prior surgeries and their age. , Perimatics co-founder and CEO, told GeekWire that the surgeons themselves also have a big impact on how long a surgery takes. Each surgeon approaches an operation differently and will bring in various factors that affect the length of the operation. “That was a surprise,” said , Perimatics’ chief solutions architect and co-founder. “We had to build machine learning models customized for each surgeon.” The algorithm also takes into account the staff that will work on the procedure, like anesthesiologists. It can also suggest last-minute scheduling adjustments when operating rooms are needed for emergency procedures. Bala Nair, Perimatics’ co-Founder and chief solutions architect. (Perimatics Photo) The end goal is to help hospitals cut down the $5.2 billion a year that results from overage and underage in surgeries. In addition to staff overtime costs, operation rooms cost an estimated to run, so any variation from the set schedule can quickly become extortionate. That’s not to mention factors like patient and employee dissatisfaction, which is also a common side effect of scheduling challenges. Although this is the first time the technology has been deployed in a hospital system, Nair said it is easily scalable. Now that Perimatics has worked out which factors impact surgery length, the basic framework can be applied to almost any hospital, he said. Velagapudi said the startup is continuing work on its other AI technologies, including its Smart Anaesthesia Manager. That program, invented by Bala, analyzes a patient’s health metrics in real-time during surgery and helps doctors make decisions that have a big impact on a patient’s health when they are recovering. She also said the company is working on new solutions for post-surgery problems and surgical supplies. “It is quite different from the data science that is being done on the market today because it is real time,” Velagapudi said of the startup’s work. Perimatics spun out from the University of Washington last year and currently employs 7 at its headquarters in Bellevue, Wash. It is also a partner of , the tech giant’s startup assistance program.
David Adams, founder of the Seattle-based startup SniffSpot, with his dog Soba, at a property in the city where they had access to a fenced-in yard. (GeekWire Photo / Kurt Schlosser) When David Adams moved back to Seattle, he settled in an apartment on the seventh floor of a building in the city’s Belltown neighborhood. On Tuesday, Adams and his dog Soba were enjoying a grassy backyard behind a stranger’s house in Ballard, thanks to the company Adams started six months ago. is a marketplace that connects dog owners, who are looking for a safe and convenient space for their pet to get some exercise, with property owners, who have room outside for pups to play — and the desire to make a little easy money on the side courtesy of the sharing economy. Originally from Ohio, Adams, 31, moved to Seattle in 2010 and spent just over three years at Microsoft. He moved to San Francisco to found his first company: , a marketplace that helps users find monthly furnished housing. That company raised more than $12 million in funding, and Adams still maintains a seat on the board and travels to San Francisco regularly. “The trend that I have is that when I start a company, I start it based on my own problem,” Adams said. He used to always live in furnished rentals, until his girlfriend expressed an interest in something different. “I adopted Soba a year and a half ago and I’ve been taking her around to dog parks. She’s super high energy. I just always have had bad experiences there.” David Adams lives in Belltown near downtown Seattle and uses SniffSpot properties to get his dog Soba the proper amount of exercise. (GeekWire Photo / Kurt Schlosser) Integrating pet services and technology is part of a growing trend that appeals to people in larger cities, especially in places like Seattle where so many Amazon employees and others take their dogs to work. Seattle-based has found huge success with its pet-sitting and dog-walking marketplace, and SniffSpot is clearly playing off that demand — with a twist of its own. “Thirty percent of dogs are owned by millennials, and millennials are moving into cities,” Adams said. “So you’re having an all new set of problems with dogs. That’s why you’ve seen Rover be so successful, you’ve seen Wag be so successful, because they’re new services that appeal to urban dog owners. It’s just getting started.” Seattle Parks and Recreation offers for dogs to run free. But after Soba was bit at a dog park and required a vet visit, Adams figured there had to be a better way to get his dog the fresh air and exercise she needed. “I think that dog parks are a really important public service. You’ve got to have them in the city,” Adams said. But SniffSpot caters to people and pets who are looking for a more controlled environment, often because the animal comes from a background that makes it more reactive around other dogs and people. SniffSpot works pretty much like Airbnb, the online hospitality business. Through its website, SniffSpot users can browse a variety of host properties — there are about 70 in the Seattle area right now and Adams is hoping for many more. Hosts provide information and pictures related to the property, including details about fencing. They can set restrictions on times, breeds and numbers of dogs allowed at any given time. It’s possible to reserve a space for solo dog time, or meet up with others. Users choose a date and time to reserve and pay through the site. Soba (and Brobee from “Yo Gabba Gabba”) got a workout on Tuesday in Ballard. (GeekWire Photo / Kurt Schlosser) In Ballard, I met Adams and Soba at a typical house in the neighborhood, advertised on SniffSpot as We let ourselves in through the side gate and found a sizable area in the back for Soba to explore. There were toys scattered about and a bowl full of water on the back deck. “Having off-leash exercise is really important for a dog’s health,” Adams said, as he talked about the full range of exercise that a dog requires, beyond walks on a leash, and how that benefits the animal not just physically, but mentally, too. It’s clear that the young entrepreneur is combining his marketplace and tech experience with a new passion for pets. “I’ll be the first to say I didn’t know anything about dogs when I adopted Soba,” Adams said. “And I’ve been learning a ton.” A totally bootstrapped endeavor, SniffSpot is pretty much a one-person operation right now. Adams has relied on contractors for a little bit of help, but he’s taken no outside funding and is doing no marketing right now. He believes the right way to start a company is to build a product that people want and need, and then the product will take off on its own. In the two full months since the website has been up and functional, SniffSpot has seen 60 percent growth month over month. An app will get built eventually, he said. Soba gets a drink of water on the back deck of a SniffSpot property after running around for 30 minutes. (GeekWire Photo / Kurt Schlosser) There’s no requirement to be a host on SniffSpot, so long as the property doesn’t contain any hazards and is owned by the person posting it. Hosts are vetted through name, email and address checks and generally there is an interview and even a site visit if needed. Hosts can set their own price, with $4 being the minimum per pet, per hour. SniffSpot takes 12 percent of the revenue. “We’ve got hosts on our platform making $60 a day,” Adams said. “You’re not investing in the space. You’re not working. It’s not like Uber where you’re going and driving for hours to make money. You just let someone come use your yard — maybe you’re at work or something else and you’re just making incremental income.” Users are expected to treat the space like it’s their own — clean up the dog poop and toys, be courteous to neighbors, etc. SniffSpot hasn’t officially launched outside of the Seattle area yet, even though some properties are listed around Washington and in other states. A couple listings on the site show the possibilities beyond a backyard romp. David Adam’s dog Soba, right, plays with Adams’ girlfriend’s dog, Toshii, in the Skykomish River at a SniffSpot called PaJo Ranch. (SniffSpot Photo) Just past Monroe, Wash., a includes a wooded area and access to the Skykomish River for $10 an hour. And south of Seattle in Cinebar, Wash., on a mountainside are available. For anyone who is apprehensive about hiking in open areas with their dog off leash, the bigger SniffSpot properties could provide a solution. Adams, who goes to SniffSpots pretty much every day, sometimes multiple times a day, said there are a million examples of people sharing things these days, but that SniffSpot doesn’t really compare. It’s not really invasive because no one enters your house, they’re in a controlled space, they stay for an hour and leave. Sitting behind someone’s house in Ballard, in rapidly growing and housing-crunched Seattle, he admitted how special a place it was. “If everyone had their own yard, there’d be much less demand for something like SniffSpot,” Adams said. “It’s amazing that these yards actually even exist still.”
The HyperAI team, from left to right: Benji Barash, Yves Albers, Dave Matthew, and Elizabeth Nelson, with TiE Seattle board member Shirish Nadkarni and Madrona Venture Labs CTO Jay Bartot. (Not pictured, from the Hyper AI team: Ritesh Desai and Joaquin Zapeda) (Photo via Madrona) Food safety is a pressing issue. The latest example came last month when an elusive strain of E. coli linked to romaine lettuce sickened 121 people across 25 states and killed one, for how food is screened for safety and quality. Now a newly-formed group of entrepreneurs wants to use machine learning technology to help keep food free of harmful bacteria and containments before it reaches the dinner table. Hyper AI took home the first place prize at a hosted by TiE Seattle and Madrona Venture Labs, the startup studio housed inside Seattle-based venture capital firm Madrona Venture Group. The event featured eight teams who came together last month and spent this past weekend creating startup ideas that incorporated the latest machine learning and deep learning technology. Eight teams participated in the Machine Learning Startup Creation Weekend at Madrona Venture Labs. (Photo via Madrona) The winning team, Hyper AI, aims to help the food industry with hyper-spectral imaging tech that can detect everything from foreign objects to deadly bacteria. It plans to deploy edge devices on customer premises and do the heavy lifting for image analysis with machine learning in the cloud. The group, made up of Amazon vets and experienced technologists, explained that existing solutions are either too manual and expensive, or too specialized. It hopes to use machine learning to improve the food scanning technology over time as it learns how to detect more and more contaminants. “They were able to demonstrate why there is increasing awareness of the issue and demand for new, innovative solutions,” said Mike Fridgen, CEO of Madrona Venture Labs who helped judge the pitches. “They had defined their beachhead opportunity, where they would start, through in-depth conversations with potential food processor customers.” As the first place prize winner, the Hyper AI team will now meet with Madrona Venture Labs with a chance to land a $100,000 investment and participate in , which just . Accepted startups in the accelerator will use Madrona Venture Labs resources — expertise in company creation, design, engineering, etc.; access to Madrona’s advisor and investor network; and more. It will be housed in Madrona’s that opens later this summer underneath its existing downtown Seattle office. Madrona Venture Labs held in the past and ended up investing in the winning companies. The studio is focusing on supporting “vertical” machine learning and artificial intelligence startups, as explained . The second place team from last weekend’s event was FireWise, which aims predict wildfires before they happen. The third place team, HealthShop, wants to help guide healthcare patients to surgery centers. (Editor’s note: I was one of the six judges at the event. Others included Madrona Venture Labs CEO Mike Fridgen; Flying Fish Managing Partner Heather Redman; Madrona Ventures Venture Partner and University of Washington professor Dan Weld; Koru CEO Kristen Hamilton; and Microsoft GM Sona Vaish Venkat )
Zembula CTO Carl-Einar Thorner and CEO Robert Haydock. Photo via Zembula. has raised another round of investment to help marketers acquire more email addresses. The Portland startup just closed a $2.9 million investment round from existing investors, including Portland Seed Fund and veteran angel investor Jason Calacanis. Part of the round included a conversion of $1.6 million in convertible debt. Founded in 2013, Zembula helps 280 customers like Staples and Best Western produce and deploy interactive marketing campaigns across multiple digital channels. Traditionally, many companies will hire brand agencies to develop these campaigns, but Zembula wants to give in-house marketers the ability to come up with their own creations without coding knowledge while also being able to access analytics. The 8-person company will use the fresh funding to launch a new version of its product this September. It is led by CEO , formerly CEO of Scratch-it, the precursor to Zembula. is the company’s co-founder and CTO. Zembula is one of several marketing startups in the Pacific Northwest — , , , and are four others.
Peter Chee hiking with his 10-year-old twin sons on a past trip to Zion National Park, Utah. He marked 10 years of entrepreneurship on May 1. (Photo Courtesy Peter Chee) [Editor’s Note: is founder and CEO of Seattle-based .] I’ve been reflecting on my journey over the last 10 years of being an entrepreneur with my boys, Max, Sam and Josh, of which Sam and Josh are 10 years old. I’ve been having them reflect back on their 10-year life journey too. Through this journey, I’ve experienced some amazing highs and crazy lows. I’ve made some good choices and had some fantastic experiences that I lean on which remind myself that I can accomplish things I never thought I could. I also see a string of mistakes that I’ve made which still sting with pain like a cut on my foot while getting hit by a wave of salt water at the beach. It’s uncomfortable, but, in a healthy way. Put your name on your list Back in the first year of running the company, I hired Sonya Stoklosa, an executive coach who was a former Olympic Trials athlete. I resonate with someone who has an athlete mindset and applies that to business. One of the most critical questions she asked me was to make a list of the 10 most important people who I care about. After looking at that list, she said to me, why isn’t my name on it? My response was I have to take care of other people; I don’t have time for myself. Her response was if you don’t take care of yourself, how could you take care of others? It was this one question that spawned off a lot of shifts and changes in my life and business. Don’t be afraid to fail I intentionally make sure my kids see me falling down. They have even said to me, “get back up and try again.” Life of being an entrepreneur isn’t a highlight reel of success. I’ve learned that while it’s important to have a lot of grit and push really hard, it’s much more about resilience from failure. It’s about getting up quickly after falling. The most important part of failure is to keep running at it, not away from it. Eventually, if you spend enough time running towards something, it will get a lot less scary and difficult. Define and defend Keep intact the things you cherish the most. For me, my non-negotiables are: I’m showing up for my three boys Max, Sam, and Josh no matter what. When I asked them, “does Dad show up?” their response isn’t going to allow me to win Dad of the Year Awards, but “yes most of the time” is a pretty solid response. My health. Wake up at 5 a.m. no matter what bad choices I’ve made the night before and start my day with exercise. Push as hard as I possibly can and recharge with the same level of intensity. The hardest part is once you define it, you have to also defend it ferociously. Do this and it will help make decisions simpler. Measure your feelings While measuring feelings sounds subjective or maybe even impossible it can be done. Start by doing this on the first day of each month and come up with one-word summaries for these things and ask yourself how you were feeling over the last 30 days: Mentally Emotionally Relationally Physically Spiritually Then for each of these things assign a number between minus five (-5) worst it has ever been and plus five (+5) best that it has ever been and where zero is your personal normal. Once you begin to track these things you’ll see trends and from there you can make conscious choices to give energy towards the category that you want to see change. It wasn’t until I had amassed a year of data that I threw this information into a spreadsheet and saw these trends. I also started to reflect back at those past months and ask myself what did I do to make some months so much better than others? Why can’t everything be fun? In this framework, everything has to be fun. There are three categories: Type 1 Fun, which is quick. Type 2 Fun, which is moderate. Type 3 Fun, which is big impact. Here are some examples of my Type 1 Fun: checking email, talking with a new customer, having a glass of wine with a friend and having a good conversation. Type 2 Fun: talking with a mentor that is 10x where you’re at, strategic planning, coming up with a go-to-market strategy, going for a 5-mile run, learning to swim. Type 3 Fun: launching a new location, forming a new partnership with a big company, running a marathon, swimming across Lake Washington, hiking Mailbox Peak. So for me, it’s simple, I need to spend more time doing Type 2 and 3 Fun. Just remember to define your own list, some of the things on my list could be total torture to another person. Once you start to schedule in these kinds of things into your day and week, protect your schedule and see the impact on how you feel. Your personal core values My personal core values became clear to me over this last 10 years. They are: Adventure Challenge Relationships. In the darkest times of running your company when everything comes into question as to whether or not you’re doing the right thing, take a look at what you’re working on and ask yourself where you’re spending your time. If you’re spending all of your time on things you don’t enjoy, you don’t have to quit your company, you can hire someone who really enjoys doing those things and focus your time on the things that are in alignment with your personal core values. Be the best version of yourself and let that drive the business. Don’t let the circumstances of the business drive you. Your identity is not your company Yes, you’re spending so much time focused on your company and chances are after 10 years, people will associate you with the brand of your company. Through the successes and failures of your company, those things do not define you and if you get to the point where you successfully exit your company, you’re not exiting yourself. If you’re a parent, you’re not defined by your children either and some could say that you care about your company and your children similarly. Yes, you love them with all your heart, but, they do not define you. Do other things that provide you personal accomplishment. For me, I’m a marathoner and an Ironman in-training. These other activities give me confidence, reduce my stress, provide me focus, and allow me to invest in myself. Pay Yourself Yes, there are sacrifices that you have to make. Sometimes cash flow is so tight that you fear you might miss payroll. This is always the most stressful and scariest thing that can happen. If you’re bootstrapping, the first thing that happens when cash flow is really tight is you pay your employees and don’t pay yourself. If you’ve raised money and cash flow is tight or you are not hitting your goals, your board or investors may ask you to lay off employees. Either way, you’re in a situation where you’re going to have to make hard decisions. The key thing is to pay yourself. You’re putting everything at risk and setting aside 10 percent profit for that level of risk needs to be ferociously defended. Once you set that aside, you won’t have any regrets, and, the company will learn to adjust itself on the expense side. Leaders in charge of profit and cost centers will innovate in order to survive and eventually thrive. Hire a coach The number one reason is accountability. Hire someone who is going to be asking you hard questions, helping you set goals, and holding you accountable. They can provide you an unbiased perspective on what you’re dealing with. If you can’t afford to hire a coach, bring on advisors to your company. These advisors should be people who are 10x where you are at. Set a regular time to meet and ask them to hold you accountable to your goals. These people don’t judge you, they support you, and just want you to succeed. This is a game-changer. Don’t worry about what other people think After reflecting and talking with my boys, the things that they said they learned were to not worry about what others think of them and it is not going to be as bad as you think. The thing that they are most proud of is hiking up Angels Landing in Zion National Park, Utah.
U2’s Bono and The Edge in concert Friday night on the 2018 Experience + Innocence Tourin St. Louis. (Photo by Remy, via , ) Seattle-based on-demand trucking technology startup Convoy already counts several rock stars of the tech world among its investors — including Microsoft co-founder Bill Gates, LinkedIn co-founder Reid Hoffman, Salesforce CEO Marc Benioff and Amazon CEO Jeff Bezos. Turns out some actual rock stars have invested, as well. Convoy that U2’s Bono and The Edge quietly invested in the company last year. Convoy declined to disclose the amount of the investment. The U2 frontman and guitarist were introduced to the company by Hadi Partovi, a Convoy board member, investor and CEO of Code.org. The news coincides with the recent start of U2’s “Bono and The Edge know more about trucking than you might think. They’ve spent most of their adult lives touring the world with U2, and trucks are an essential part of moving the show from city to city,” said Convoy CEO and co-founder Dan Lewis in . “When they heard about Convoy, they loved that we are using technology to empower millions of truckers to grow their businesses while at the same time reducing empty miles and waste.” Convoy co-founders Dan Lewis, CEO, and Grant Goodale, CTO, inside the company’s Seattle headquarters. (GeekWire Photo / Taylor Soper) The company has been described as the “Uber for trucking,” using technology to connect truck drivers with excess capacity to shippers looking to move freight — including Fortune 500 companies — automating traditionally a slow and time-intensive process. Convoy works with 15,000 trucking companies and 100,000 truck drivers, and has grown to 225 employees. Bono and The Edge are no strangers to technology investing, from to cloud storage giant Dropbox. Partovi and his brother, Ali, who met Bono and The Edge through their previous startup iLike, also , as well. Convoy raised $62 million in a Series B round last year, led by , the investment arm of Silicon Valley-based accelerator Y Combinator. The investment by Bono and The Edge was not part of that round. Total funding in the company now tops $80 million. Convoy was named and is , set for Thursday night in Seattle.
Arry Yu. (Photo via ArryinSeattle.com) Find your “AJ.” Watch out for assholes. And know when to call it quits. closed the book last week on GiftStarter, her 4-year-old Seattle startup that aimed to personalize and simplify the process of purchasing gifts as a group. In an email to GeekWire, Yu said the biggest problem for GiftStarter was product-market fit. The company went through two accelerators, and 500 Startups, but struggled to acquire customers and nail down a robust business model. Yu let go of her employees in April 2016 but kept the company alive, even taking a major personal loan to try and fund it further. But she officially closed up shop last week. In a , Yu thanked her investors — local angels like Heather Redman, Gary Rubens, Rebecca Norlander, and Rudy Gadre — and other supporters. The entrepreneur also admitted that she should have shut down GiftStarter in 2016 and listed 10 lessons from her startup journey. “Startups are really hard,” Yu wrote. “Don’t do them light heartedly or just because it’s the trend. Don’t do it because you’re bored at work. Do it because you cannot exist in life without the big idea going big.” Among her other lessons for founders: “Find the ‘AJ,'” which is someone by your side “that’ll turn left and pounce 5 feet into the air when you just jump left” — a tip she learned from OfferUp founder Nick Huzar. She also advises startups to focus on finding a market before building a product; file proper documentation; and watch out for “assholes posing as advisors just for the vanity of it.” You can read the full post . Yu is now COO at , a Seattle startup formerly known as CakeCodes that lets people earn cryptocurrency by performing micro-tasks.