• At StartX Demo Day, a Wide Assortment of Startups

    Box-of-ChocolatesLittle about the accelerator program StartX is conventional. On the one hand, the 5.5-year-old, Palo Alto, Ca.-based outfit is a nonprofit that helps founders affiliated with Stanford University to build peer groups, as well as their confidence. Specifically, it provides companies with 10 weeks of free educational programming about everything from setting goals to launching products.

    But StartX is also becoming a power player, owing largely to a deal it struck in September 2013 with Stanford University and Stanford Health Care, which asked it to manage a for-profit vehicle on their behalf — uncapped capital that StartX now uses to invest in up to 10 percent of its founders’ rounds.

    You can actually see StartX’s growing influence. Not only does the 16-person outfit now operate out of 13,000 square feet of office space, but at a demo day yesterday, on the heels of one of StartX’s three yearly sessions, roughly 200 investors stood elbow-to-elbow in a nook of that space to hear 20 of its companies ask them for funding.

    Perhaps unsurprisingly, the companies were a tad unconventional, too.

    One presenting company, Summer Technologies, a sustainable agriculture startup, is hoping to transform the cattle industry by bringing analytics to grazing management. Currently, says CEO Christine Su, farmers aren’t making the most of their land. They allow their cows to graze too long in one place, when moving them around more frequently would keep the grass and soil healthier. Summer’s software, currently being piloted at 30 ranches across five states, pulls in rain, soil and other data that can help those farmers boost their productivity.

    Another company, Payjoy, aims to bring consumer finance to hundreds of millions of people in India and elsewhere by embedding technology in smartphones and TVs that allows them to pay for the products as they’re used, instead of in up-front cash. Striking the right relationships would seem to be a big hurdle for Payjoy, but founder Doug Ricket, a former Google engineer, has spent the last six years selling technologies into the developing world; presumably, he has a network to leverage.

    Vouch, a third startup, also has an unusual approach to what’s an increasingly crowded space. It intends to use the creditworthiness of a borrower’s personal network, as well as their own individual data, to tailor personal loans for its users. Think friends, uncles, cousins. It sounds a little out there, but online lending is obviously a huge and growing market, and the team includes former alums of PayPal and Prosper, among other companies.

    How far these companies will go is anyone’s guess. But the portfolio of StartX appears to hold promise. Since launching its fund with Stanford’s capital — it’s called the Stanford-StartX Fund — StartX has invested $31.4 million across 82 companies, 9.2 percent of which have already been acquired.

    At least one company, six-year-old, San Francisco-based Life360, looks like a breakout success story, too. Right now, two million families are signing up for its family communication app each month — traction that investors have noticed. (The company has raised $76 million to date.)

    Of course, the organization has also seen its flops. Though 88.5 percent of its companies are still up and running, StartX readily admits that another 11.4 percent have gone out of business.

    If press reports are to be believed, one of its highest-profile portfolio companies – the payment startup Clinkle – may be headed in the same direction.

    For a full list of the companies that presented yesterday/are looking for funding, click here.

  • DataFox Aims to Disrupt Company Intelligence, Upset Michael Bloomberg

    Bastiaan JanmaatBloomberg and Thomson Reuters had better watch their backs – or else get out their checkbooks. The financial information giants suddenly face a spate of startups ready to take a big bite of their businesses, with DataFox, a year-old, nine-person team in Palo Alto, Ca., among the newest.

    So far the company, run by Stanford alums, has raised $1.78 million in seed funding from Google Ventures Ventures, Sherpalo Ventures, and Green Visor Capital, among others, for its subscription-based deal intelligence platform. The idea: replace expensive and sometimes far-flung analysts with algorithms that can turn structured and unstructured data into real-time, competitive insights about companies.

    DataFox, which has three subscription tiers — $49 per month, $399 per month, and “call us,” essentially — says it isn’t ready for another round of funding just yet. At the moment, at least, it’s more focused on launching its beta product, having tested out its service over the past year with more than 2,000 trial users. Still, cofounder and CEO Bastiaan Janmaat says paying customers, including Box, Twitter and Bloomberg Beta, think the company is on the right path. In fact, he says of his company (only half-kiddingly): “This probably isn’t what ex-Mayor Bloomberg is looking for upon his return as CEO.” He shared more with us yesterday.

    DataFox mines all kinds of public information to do its job. Does it create new data, too, or might it?

    We do create new data, but we do it automatically. One example is competitors lists. Other databases suck at this. Human analysts at [the business data and analytics company] Dun & Bradstreet update their list just once a year. Our algorithms look at things such as co-mentions in news articles and similar press releases to automatically generate a list of similar companies, updated in real-time. The same is true of sector classifications. We invented our own sector taxonomy of more than 70,000 keywords . . . so now a company like Box is classified as “file sharing, web hosting, cloud computing, ftp replacement” plus 20 other terms, instead of just “file storage.”

    You “push” out information that you deem relevant to your customers, like a headcount mention deep in a news article. How is that information delivered?

    People get one weekly email. We’ll soon allow for opt-in daily alerts. Meanwhile, people login to DataFox for the real-time feed.

    A lot of your customers are interested primarily in private company information, but you also track public companies, correct?

    Yes, which is why our business is such a radical departure from the status quo, meaning CapIQ, Thomson Reuters, Bloomberg, and so forth. We’re building entity-agnostic algorithms that, over time, we can apply to any company, person or theme. We have around 7,000 public companies in our database currently. Whenever a customer requests that a company to be added, all we need is the URL, and we’ll auto-generate a one-pager in a matter of hours.

    What’s on your roadmap? What else will DataFox offer customers next year?

    Collaborative and team features. Expanded company coverage. We’re currently at 450,000, but I expect to cover more sectors within a year and more international companies. We’ll also be tracking more types of events. We have the pipes and parsers built, so we’ll continue to write more rules to identify more structured data points beyond the headcount, revenue, and valuation data we currently collect — like new major customers and new offices.

    You say you aren’t raising money again until some time next year. What milestones do you plan to reach before talking again with investors?

    We’re a subscription business, so we’re looking to continue growing revenues, but the one metric we care about most is engagement, meaning the frequency of logins and alert email opens, as well as the number of companies that [customers currently] follow, which is 35 per user. If we can continue to get daily engagement from analysts at Intuit, Bloomberg Beta, Google, Goldman Sachs, and the like, we’ll bolster our prognosis that we’re disrupting the large incumbents, and that data can’t be “pull” anymore. It needs to be predictive.

    Why are you so convinced that “push” is the way to go?

    The volume of communication and data is exploding, there are too many streams to pull from, so mathematically it’s necessarily becoming less likely that you are able to pull the right data point at the right time. Specifically for our customers, companies’ online footprints are expanding, so there’s more information out there, but they don’t have time to monitor a company’s employees on LinkedIn, their Twitter account, their Delaware filings, and the regional papers that cover them. Hence the need for push. I train my delivery pipe to understand my interests, schedule, and priorities. The pipe decides what’s important and surfaces that for me.

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