IU Invests in Student Entrepreneurs
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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowIndiana University is giving young entrepreneurs an opportunity to compete for prize money and kick-start their businesses. Seniors and graduate students recently competed in the finals of the Building Entrepreneurs in Software and Technology competition, also known as BEST. IU says applications for the 2015-16 BEST Competition will be accepted in the fall.
March 26, 2015
News Release
BLOOMINGTON, Ind. – A successful business needs three things: an idea, hard work and capital. The first two facets are easier to come by. Finding capital, on the other hand, can be tough.
Catching the attention of investors isn’t simple, but a group of Indiana University seniors and graduate students recently found themselves with a golden opportunity to kick-start their budding businesses.
Eight teams recently competed at IU Bloomington in the finals of the Building Entrepreneurs in Software and Technology competition, better known as BEST. The competition provides a platform for potential entrepreneurs to meet with a group of investors with a total of $250,000 on the line, including $100,000 to the entrepreneur with the best idea.
BEST is the result of collaboration between the IU School of Informatics and Computing and the IU Kelley School of Business.
Scott Dorsey, a 1989 graduate of the Kelley School and co-founder and former chairman and CEO of ExactTarget in Indianapolis, helped create BEST four years ago. He took the lead role at the Feb. 19 competition.
Dorsey says win or lose, the BEST competition provides the budding businesses the kind of investor insight that could help them in the future.
“Hopefully it’s a turbo-booster to give them more passion around the idea they want to pursue,” Dorsey said. “These are young people who have big dreams and want help and guidance to avoid mistakes and get some velocity.”
The competition was created to enrich the entrepreneurship at IU, in Bloomington and beyond, according to Bobby Schnabel, dean of the School of Informatics and Computing and one of its developers.
“A key goal of BEST is to contribute to building the culture of entrepreneurship at IU. It has been great to see that culture rapidly increase in recent years due to BEST and a variety of IU and local community initiatives,” Schnabel said.
Although the ultimate goal of every team is to win the seed money, the experience of making presentations and receiving feedback from the investors also is valuable.
Kevin Casimer, co-founder and chief operating officer of FundSponge, has taken part in the Kelley School’s Clapp IDEA Business Plan Competition, and his company has made a handful of other presentations to investors in the past. Still, with so much on the line, he felt the pressure of the BEST event.
“Most of those have $5,000 to $10,000 in prize money,” Casimer said. “We weren’t particularly nervous, but we’ve gotten good feedback from potential investors. All of that said, there’s a difference between pitching to win a $5,000 contest and pitching to get a $100,000 investment. It would be lying if I didn’t say I wasn’t aware of that.”
On the flipside was Lucas Malone, a co-founder of Leyefe, a self-improvement application. “This was the first pitch we’ve had as a company,” Malone said. “We’re going to continuously evolve. This is our first try, and we got great investor feedback. We’re always learning.”
For Nir Paz, the co-founder of Airzz, the BEST competition was the culmination of months of preparation. The Israeli-born Paz collaborated with two friends to create a product they believe will help leave the world a little cooler.
“We’ve been friends for a long time, and we always have ideas. We had the idea in the summer while the competition was being promoted, and we decided to just submit our application,” said Paz, whose company builds portable air coolers. “We are serious with this. This is going forward, and hopefully we’ll get good feedback from the competition and somebody will give us some help going forward.”
Feedback from investors forced some teams to look at their futures from a different angle. One group was questioned about what it might do if offered a buyout from another company, and another team fielded a suggestion about not starting a new business at all but licensing its work to existing entities.
“There are questions that were being brought up that we didn’t really think about,” said Kevin Chon, the head of business for Openwords, a language-learning application. “We’re not investors, so they’re going to be thinking about it from a different perspective than we are. We get to hear that, and we’re going to be talking to a lot of investors in the future. It gets us more prepared for those questions.”
During the final presentations, each team gives a 20-minute presentation and then takes questions for another 10 minutes. Winners won't be known until later this spring, after further due diligence is performed to ensure that the firms are truly viable.
Applications for the 2015-16 BEST Competition will be accepted in the fall, and this year’s competitors had simple advice for anyone thinking about entering the competition: Do it.
“I would highly recommend it,” said Melody Dye, vice president of NameInsights.com. “I had no idea how much feedback we would get and how much we would learn. I think it was an incredible learning process.”
Adam Sobol, a senior in the School of Informatics and Computing and founder of CareBand, agrees. “Just jump in and go for it,” he said. “You have to have a place to start, an idea and a vision, and once you have that, you have to work your butt off to make it a reality. It’s a great opportunity.”
Dorsey has been happy with the result of the BEST competition to date, but he hopes to guide the event to an even brighter future that can make a larger impact.
“My hope is that we’re funding sustainable businesses that can grow over time and stand the test of time,” Dorsey said.
The Building Entrepreneurs in Software and Technology fund was created in 2011 with support from 10 individual investors and the IU Research and Technology Corp., and it has since expanded to 26 investors. A call for proposals for the 2015-16 competition is expected to go out in September.
Source: Indiana University