Thursday, March 26, 2015

How Chicago's Popular Pays Made the Most of Y Combinator

How Chicago's Popular Pays Made the Most of Y Combinator
Jim Dallke - Staff Writer
03/26/15 @2:13pm in Tech
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Two and a half minutes. After 100 days, countless hours, and many sleepless night, that's all the time startups have to impress investors at the Y Combinator Demo Day. Regarded as the best tech accelerator in the country, Y Combinator, which invests $120,000 for 7% of the company, has helped launch some of today's most well-known startups. And with its latest class, it can add a Chicago-born company to the list.
Popular Pays, a startup that allows Instagram users with a high number of followers to earn money by taking pictures with certain products, was part of the YC winter 2015 class. In an accelerator that sees mostly California-based companies, it was an important milestone for the young Chicago startup.
The company presented at Demo Day this week, and their performance has already resulted in a flood of interest from investors, according to founder Corbett Drummey.
"It was intense," Drummey said. "It was 100 days of very hard work ... The only goal you have is trying to get investors to remember 1 or 2 points of your company and have them want to reach out and contact you."
Since Monday's Demo Day more than 90 investors have reached out to the company, which is a kind of investor reach Popular Pays couldn't have achieved anywhere else, Drummey said. But the benefits of YC expand beyond just access to capital; the community of advisors, peer support from fellow startups, and the chance to focus on the direction of the company all helped mold Popular Pays over the past 100 days, Drummey said.
"One of the most underrated aspects of Y Combinator is focus," he said. "With our whole team out here working, we just had a tremendous amount of focus during these 100 days."
Popular Pays used YC to help the startup shift from connecting influential Instagrammers with small business, to adding larger brands to its platform. In the past three months Popular Pays brought on Nike and a large restaurant chain that Drummey declined to disclose, citing the company's wish not to be named.
Here's how Popular Pays works: Companies list what type of social media post they want on the platform, and "influencers" (people with a large social media following) choose the ones they want and name their price. If the company accepts the offer, the influencer is paid after the shoot.
Nike, for example, may say it wants an Instagram post showcasing its new glow-in-the-dark shoe, and requests a photo of someone wearing the shoe while running at night. Sometimes the payment is free product (like Nike shoes), but for users with a higher follower count (above 40,000) the company pays the user cash for the post.
Drummey said the company has 20,000 Instagrammers using the app, with roughly 1,000 people using it for paid deals. Popular Pays has paid out $130,000 to Instagrammers in the last 3 months, he said.
Drummey and the eight-person Popular Pays team is returning to Chicago in April, but he expects to move the company's operations and engineering to San Francisco in the near future. The sales will remain in Chicago, and he expects to begin hiring more sales people soon. The main reason for the move was that engineers were more likely to relocate to San Francisco than Chicago, Drummey found.
"That was the hardest decision to make," he said. "We wanted to keep our momentum going. When it came down to it, we knew we wanted our sales team in Chicago. But what we found for engineering talent is that people were less likely to move to Chicago. Engineers were more likely to relocate (to San Francisco)."

Popular Pays raised roughly $775,000 before YC, mostly from Chicago angels, including Howard Tullman and Lon Chow.

Wednesday, March 25, 2015

Huff Po - How Chicago Edtech Companies Are Rising to the Head of the Class


How Chicago Edtech Companies Are Rising to the Head of the Class

Posted: Updated: 
 education - particularly within K-12 - are rapidly transforming. Educators have access to more digital resources than at any point in history, and are using a combination of apps, videos, and websites to flip their classrooms, personalize instruction, and assess student performance both individually and in aggregate.
The Chicago-based edtech startup where I work, appoLearning, recently unveiled a universal search engine that lets teachers search for by keyword for the best resources to teach subjects ranging from Number Sense to geology to high school political science
Other Chicago-based startups, often founded by educators who sense opportunity amidst all of this disruption, smell blood.
"Big companies with top-down approaches and highly paid sales teams don't get what startups are good at," explains Howard Tullman, longtime entrepreneur (edtech and otherwise) and CEO of Chicago's digital media incubator 1871. "But what startups need to understand is that they have to solve the adoption issue (of their product) first, and then they can worry about writing a giant contract."
Combining the best of both worlds 
In recent years, several 1871 edtech companies have raised angel, institutional and corporate venture capital.
ThinkCERCA, which creatively couples informational text and reading assignments for students grades 4-12 with Common Core-aligned assessments, in March raised $3.2 million in venture capital in a round led by the venture capital arm (managed byAtrium Capital) of Chicago area educational publishing pioneer Follett. Other investors included Chicago-based Math Venture Partners, Amicus Capital, Great Oaks Venture Capital, and angel investor/OpenTable founder Chuck Templeton. ThinkCERCA has previously raised $1.5 million from individual investors.
Beyond the capital from Follet, which will be deployed to sales and engineering talent, ThinkCERCA CEO Eileen Murphy (a former Chicago public school teacher and administrator) sees relationships to tap into from a company that was founded two years after the Chicago fire (1873).
"One thing that Follett can bring today is a lot of credibility with customers, which helps us stand out." We have yet to work out all of the details of the partnership, but we are figuring out how to leverage their enormous network of schools." 
Follett CEO Mary Lee Schneider concurs.
"Follett works with more than 70,000 schools across the country," she said, "and through this partnership, we'll be able to expand ThinkCERCA's reach, as well as foster developments that will make the technology even more effective and easier to use."
ClassKick, another Chicago edtech company to recently raise venture capital, has already attracted customers nationwide and in 75 countries around the globe with its slick technology that lets teachers individually monitor students in their classrooms as they are working on problems on their iPads. The company raised a $1.7 million seed round led by leading edtech investor Kapor Capital, Lightbank, Great Oaks Venture Capital and Yammer founder Adam Pisoni. ClassKick's founders hail from Teach for America and Google.
Other 1871 edtech companies that have either recently raised significant outside capital or are expected to include Learnmetrics (an analytics company that aims to do for educational data what Mint.com does for financial data), NextTier Education(which is reimagining the college application process) and Infiniteach (developer of the Skill Champ app for students with autism).
Beyond funding 
Edtech companies springing up at 1871 and other Chicago locations are also benefiting from local organizations like Leap Innovations and DV X Labs. Founded by former New Schools for Chicago CEO Phyllis Lockett, Leap Innovations is based in 1871 and helps educators discover the best new educational innovations (while also providing feedback to edtech developers). DV X Labs, a joint venture between 1871 and DeVry, is an accelerator for edtech companies seeking to pilot and market their offerings.
Of course the best resource for an early stage edtech company (in Chicago or otherwise), explains 1871's Tullman, is a good customer relationship management system.
"They need a good CRM program to find champions and advocates within schools, and not spend too much time on marketing to everybody," he says. "I wouldn't even call it viral. It's simply class warfare."

Tuesday, March 24, 2015

1871 AND MICROSOFT VENTURES ANNOUNCE THE PARTICIPATION OF 1871 MEMBER COMPANIES IN THE SEATTLE MICROSOFT VENTURES ACCELERATOR PROGRAM

  


1871 AND MICROSOFT VENTURES ANNOUNCE THE PARTICIPATION OF 1871 MEMBER COMPANIES IN THE SEATTLE MICROSOFT VENTURES ACCELERATOR PROGRAM

1871 Member Companies ClearContact and ParkNav will Benefit from the Mentor-Driven
Four-Month Program Focused on Digital Works 

CHICAGO (March 24, 2015)—1871, Chicago’s entrepreneurial hub for digital startups, and Microsoft Ventures are proud to announce the selection of 1871 member companies ClearContract and ParkNav to participate in the digital work-themed Microsoft Ventures Accelerator in Seattle, Washington this spring.

The Microsoft Ventures team hosted open houses around the country with the purpose of attracting digital startups to apply for the four-month accelerator program. Leveraging the extensive partnership between 1871 and Microsoft Ventures, they hosted a Chicago open house at the digital startup incubator in The Merchandise Mart. During this open house, seven local startups had the opportunity to pitch their businesses to a sold-out crowd of investors, entrepreneurs, and the Microsoft Ventures team. This, according to the team, was the best-attended event nation wide, with a greater outcome than all other open houses combined.

“Our primary goal at 1871 is to help Chicagos best digital designers, engineers, and entrepreneurs succeed in creating sustainable businesses,” said 1871 CEO, Howard A. Tullman. “With partners like Microsoft Ventures, we are able to provide exciting opportunities that deliver meaningful, long-term benefits to our members as well as the larger Chicago tech community.” 

The focus of our accelerator program is to help entrepreneurs build great companies, said Microsoft Ventures Accelerator in Seattle Director, Mukund Mohan. Leveraging our partnerships, we are able to provide direct support to the best entrepreneurial ecosystems across the country, and the world. As a startup hub, 1871 embodies Chicagos natural drive to innovate in the digital age and Microsoft Ventures’ determination to foster great technology in business.

The Seattle Microsoft Ventures accelerator program kicked off on March 16, and will end on July 16 with a demo day. With a digital works theme, the accelerator will focus on enterprise solutions, productivity, and B2B solutions while implementing Microsoft technology to the participating businesses. Besides Chicago-based ClearContract and ParkNav, companies from Michigan, New York, California, Oklahoma, Texas, Washington, and Canada are also part of the program. 

"We could not ask for a better partner in growing and scaling our business than Microsoft Ventures, said ClearContract COO, Kyle Cushing. Were extremely excited to collaborate with the other fantastic companies in the program, and also to leverage the breadth of talent within the Microsoft ecosystem to help us bring ClearContract to businesses across the globe."

Being selected for the program means not only that we are able to work together with other amazing companies and talented people, but also receiving tutelage from the folks at Microsoft to help us take ParkNav to the next level,” said ParkNav VP of Business Development, Gerhard Boiciuc.   



ClearContract is a technology that makes it painless to distribute, negotiate, sign, file, and manage contractual agreements so that dealmakers can eliminate risk and spend more time closing.



ParkNav is a technology that helps drivers reduce the time they spend searching for available street parking. The technology is predictive and uses big data, crowdsourcing, and machine learning to help drivers save 50 percent of their search time and reduce pollution in our cities.


About 1871
1871 is the home of more than 325 early-stage, high-growth digital startups. Located in The Merchandise Mart, this 75,000 square foot facility is also the headquarters of nationally recognized accelerators, Techstars Chicago and Impact Engine; half a dozen industry-specific incubators in key areas such as real estate, education technology, food and financial technology; several emerging tech talent schools (The Starter League, CodeFellows, Flatiron, The Fullbridge Program, Designation, and the Startup Institute), and the state's leading technology advocate, the Illinois Science and Technology Coalition. It is the second home to Chicago-based VCs, Pritzker Group, MATH Ventures, Hyde Park Angels, OCA Ventures, OurCrowd and Chicago Ventures, as well as satellite offices for Northwestern University, University of Illinois, University of Chicago, Loyola University, Illinois Institute of Technology, and DeVry. 1871 has fast become recognized as the hub for the citys entrepreneurial/technology ecosystem and has been featured in TechCrunch, Wall Street Journal, New York Times, Chicago Tribune and Crains Chicago Business among other top media. 1871 is the flagship project of the Chicagoland Entrepreneurial Center.

About Microsoft Ventures

Microsoft Ventures is a global initiative to help entrepreneurs build great companies. We work with startups at every stage of maturity to provide the tools, resources, and expertise they need to succeed. The initiative is broad-based, and includes a community program, accelerators, and a seed fund. Our approach helps startups scale their business, bring innovative services to market and reach new customers.


1871 CEO Howard Tullman Keynotes Legal Aid Gala



I Voted Early


9 Reasons Silicon Valley Should Move to Chicago

9 Reasons Silicon Valley Should Move to Chicago
Posted: 03/18/2015 10:46 am EDT Updated: 03/18/2015 10:59 am EDT

o    
Are you tired of living in Silicon Valley's tech bubble? Do you want to be part of a growing startup-friendly tech hub? Come to Chicago! Here are nine more reasons to make the move:
Water: Chicago has water. Lots of water. Take lots of guilt-free long hot showers. Spring through fall, sail on the great lake Michigan. Join the famous Mackinac Boat Race. Watch the annual Air and Water Show.

Fly Anywhere Nonstop: Chicago has an international airport with direct nonstop flights to major cities and world capitals including New York, London, Washington, San Francisco, Amman (Jordan), Tokyo, Seoul, Beijing, Shanghai, Doha (Qatar), Dubai, Abu Dhabi, Delhi, Hong Kong, and Singapore.

Fun and Food: Chicago has a great nightlife with bars, pubs, and dance clubs. Restaurants aren't crowded; you can get a table at the best restaurants in town without much fuss. In fact, you'll get a seat almost any time of day. Last Wednesday, I breakfasted at the Michigan Avenue Le Pain Quotidien at 7:40 a.m. In New York, the place would be packed at that hour, but in Chicago, I had the place to myself. Carlos, the friendly server, and Devon, the cheerful cashier, would love to see you! In the summer, dine al fresco at one of Chicago's many outdoor garden or lakefront restaurants.

Great homes and views: Chicago has abundant affordable luxury apartments and homes with lots of space and stellar views. Yes, Chicago has lagged the rest of the country in housing cost rises, but that is an opportunity for you. You can buy a tiny condo in Silicon Valley or a penthouse in Chicago. Even if you don't move to Chicago, buy one anyway. You can't beat the space, the views, and the amenities.

Fitness: Chicago has the best equipped gyms in the world from the matchless East Bank Club, to the Soho House, to Gold's Gyms and many more. Enjoy miles of lakefront bike trails. Chicago loves fitness.

Technology: Chicago has state of the art server centers and data farms. Chicago is already a major fiber optic cable hub, third in the USA, and is expanding fiber optic space. Chicago is home to the number one startup accelerator in the world. If you move, you will be in the company of other startups that have moved from Silicon Valley to Chicago.

Large Offices: Chicago has great office space available with famous architecture.

Culture: Chicago has lots of attractions: world class museums, theater, indoor and outdoor symphonies, and a Chicago Council on Global Affairs that is better than New York's since you can get a seat near world-class speakers. Most Chicagoans are friendly polite people (city crime aside and besides, California has crime, too), because if we weren't, in the winter, there would be no reason to go on living... other than close-by skiing, snowboarding and city-wide ice skating. When you're done, go to a bar with a fireplace for a hot chocolate or a hot toddy.

Deals: Illinois economy isn't in great shape, but it isn't much worse off than California, and the state of Illinois is already reneging on obligations like solar panel reimbursements and cutting funding for non-tech unprofitable business ventures. (h/t Second City Cop) Illinois and Chicago want your tax revenues. Move to Chicago, create jobs, and negotiate a tax deal for the day your business takes off.


Follow Janet Tavakoli on Twitter: www.twitter.com/JanetTavakoli

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