Witnessing History: The MIT $100K Competition

The MIT $100K competition is one of the largest entrepreneurship competitions in the United States and in the world. Hundreds of ideas that come out of MIT’s labs and from all over the country are measured, weighted and eventually founded. This competition has been the cradle of many multimillion and billion dollar companies. This year’s competition was divided in seven tracks, mobile internet, web 2.0, aerospace, cleantech energy , nonprofit and products and services. The competition starts in October with the “elevator pitch contest”, continues with the “Executive Summary Contest” in March and finished with the “Business Plan Competition” in May.

This years’ competition was particularly exciting. Nearly 340 ideas and teams entered the competition and there was half a million dollar in prizes, plus a special price from the U.S. Department of Energy for the best cleantech idea.

Participating in the $100K is not to be taken lightly. It is highly demanding, it is like taking another course. Besides preparing the business plan, which is very time consuming, there are some mandatory workshops and events to attend. But it is definitly worth it. For example during one of those workshops we got to learn about patents and intellectual property protection. Other presentations included successful entrepreneurs such as the founder of Kayak.com, the tourism website, or the founder of the company that invented and manufactured the X-ray machines for airports. During the $100K receptions you also get to meet other teams and I found some really exotic ideas which certainly adds to the fun!

We competed in the mobile track. The idea was basically a carpooling system. Nothing new about that you can say. But there were some twists. First it uses the geolocation features of the las generation mobile technology to make pooling easier. Second it uses a predictive algorithm developed at the MIT Media Lab to understand and predict transportation behaviors of its members. And third it uses the social network and web 2.0 features developed during the past few years to create trust in the system.

We had a very solid team. Stephen Sullivan, one of my core team mates, a Software Engineer with experience in the military aerospace industry. Shintaro Okuno, another core team mate and Manager at Bain & Company. Daniel Sheehan, from the Geo-spacial Information Lab at MIT and finally Jae Woo Chung, who developed the predictive algorithm and a specialist in mobile technology from the MIT Media Lab.

The birth of the idea was quite modest, a simple one page executive summary that was prepared in a hurry by Steve and I. In March, one week after the birth of Helena, was scheduled the ceremony with the results of the Executive Summary Contest. I went there and did not really have any hope of getting to the next round. At that point our team was composed of Steve and I only, and Steve was not even able to make it to that ceremony! It was nevertheless quite an impressive event, hundreds and maybe couple of thousands people gathered at the Student Center to see the results. I was frankly impressed. I had thought that this was a low profile event.

And so the ceremony started and winners were being announced. When the speakers came to the mobile track they announced the winning teams and Gemeni was one of them! That was quite unexpected and it changed all my plans. On one hand I was already taking a heavy course load at Sloan. Moreover, I was a dad now! Where would I find the time and energy to build a decent business plan and meet all the responsibilities that come with being a $100K semifinalist? I had no idea.

Since then, not one week passed were there wasn’t an event to meet venture capitalist (like IDG Ventures), investors, lawyers (Brown & Rudnick for example) and consulting firms (such as the Boston Conuslting Group). They would all help us shape the definitive business plan. The $100K organizers also assigned us some mentors; Anand Daniel, from IDG Ventures, and Timothy McGuire from Brown Rudnick who gave us legal advice. We got to meet with them many times, both in receptions as well as in private mentorship sessions. There contribution was on every page of the business plan and I recall meeting with them as one of the most interesting and enriching parts of the competition.

These guys had years, if not decades of experience in VC in the Boston area. I could hear stories of when they financed the first manufacturers of hard drive disks, decades ago! I learned about the birth and decay of the computer industry in Massachusetts first hand. And I was also learning about what they expected to be the next big thing; cleantech and green business. I was on top of the world at that point, I could not ask for more; I was in one of the most innovative places on earth, with the people who were inventing and financing these technologies and hopefully, with the people who were helping solve the planet’s environmental problem. I felt I was fully living the entrepreneurial culture of Boston and, as the $100K motto goes, that we were “witnessing history”.

It is quite an impressive experience for someone that comes from outside the United States. I was impressed with the entrepreneurial culture at the $100K, at MIT and in Boston. Even the smallest idea, even if it is at a very early stage of development, is nurtured, motivated and developed. I was impressed also with the importance of Intellectual Property in fostering this entrepreneurial spirit. I was impressed by the value of “Lab” concept at MIT which helps connect students from different backgrounds and push the idea into the market. I understood why it was so difficult to replicate this valuable entrepreneurial environment.

In preparing to the semifinals, Steve and I had to get serious about building a team and delivering something more than an idea. It is at this point that we started to search for other team members. Our first target was the Daniel Sheehan from the GIS Lab. I had met him during IAP. He would know how to build the geo location features of our technology. Then came Shintaro, who would help us with the financial modeling and with the presentation. Finally came JaeWoo from the Media Lab who owned the predictive algorithm technology. I got to visit the Media Lab very often and got see many new technologies and meet some engineers who where developping them. It was a very exciting experience to have this level of involvement with the Lab.

The semifinals consisted in presenting the business plan to a jury of 8 persons from the industry in the offices of one of Northbridge Venture Partners in Waltham, about half an hour from Cambridge. It was a beautiful office with an impressive view to the Hobbs Brook Basin. We were to be the first to present. And so it was. I did the opening presentation and Shintaro presented most of the material. And then came the Q&A where we all participated. The results would be delivered that same day in the evening. I was very confident and though we had made a good presentation. What is more, the idea had solid support from MIT faculty, it helped solve an environmental problem and used the latest in mobile technology.

But that was not enough and so we did not make it to the finals. I was very disappointed. But now with some perspective I understand that, while the idea was powerful, it could not be protected by patents or copyright. One way to outweigh the lack of IP protection is to create barriers to entry (such as the first mover advantage), and I think these were too weak.

In the end we got further that we had ever wished for and it was certainly a very rich and powerful experience. And this is only the first step. I am glad I still have one more year to participate and so I am already preparing for the 2009 $100K competition!