The cycle for the 2009 edition of the GRA/TAG (Georgia Research Alliance/Technology Association of Georgia) Business Launch Competition starts on January 8th.

Many of you may remember my post and the resulting comment storm about last year’s affair.  I caught a good bit of flak for over that post, but the good news is that it promoted an important dialog, and dialog is never a bad thing.  The good news is that the organizers of the event have apparently listened to the collective voice of the community, and key changes have been implemented.

According to Lance, the competition organizers have clearly set forth that entrants must have raised less than $500K in aggregate cash capital, regardless of source. The TAG/GRA event took a nasty blackeye over the aforementioned flap last year, but they seem to have corrected the problem for future events.

With all of this being said, at a time when fewer angel investors are writing smaller checks with less frequency, this competition is even more deserving of your attention.

The winner of this year’s competition will receive $100,000 in cash, $200,000 in support services and lots of good publicity.

Each year, the GRA/TAG Business Launch Competition organizers select a theme for businesses that they will consider for the award.  This year, the theme is Internet Technologies.

“This includes companies that are developing products, online services, or backend technologies that are using or extending the reach, flexibility and ease of the internet; with a particular interest in companies within the fields of digital media/technology, cleantech, mobility and securities.”

Formal applications are due by February 10th, 2009.

Lance is leading a panel discussion of prior winners on January 8th TAG Entrepreneurs Society monthly meeting at the ATDC (TSRB building) at 7:30 am.  The panelists will include IVOX, Acculynk, and REACH Call.

By the way, you can learn more about IVOX’s experience with the competition by listening to our podcast (StartupLounge #17) with Greg Warren called “Inside the Winner’s Circle: IVOX”, which we published on August 7, 2007.

Cheers.

If you haven’t heard by now (Lance Weatherby), ATM Direct won the 2008 TAG/GRA Business Launch Competition. On the one hand, I congratulate the ATM Direct team for their victory. They walked away with $100K in cash and $200K in services from various sponsors and partners. Not bad!

My other hand, however, is left wondering why a company that at one point was a significant going-concern, and was eventually bought out of bankruptcy court was even allowed to enter a competition aimed at fostering “new” companies. According to the rules of the competition:

The competition is aimed at “new” businesses, however the time and effort required to launch a successful business in the targeted areas may require that an entrepreneur form a company and begin certain limited functions before any meaningful business operations occur. These functions could include prototype or Intellectual Property development and for these or similar reasons up to $500K in external funding may be allowed. Market trials may also be required and for this or a similar reason some limited revenue may be allowed.

Some incredibly cursory research on the web revealed that back in 2005 or so, ATM Direct was bought by Pay to Touch for a little over $30M. One person told me that deal was a bankruptcy matter as well, although I can’t seem to find any reference to it. Just a few months ago (February, 2008), ATM Direct (or at least their patent portfolio) was sold under bankruptcy court supervision for a mere $600K to Accullink LLC (also located here in Atlanta).

No matter how you slice this, it bothers me. It bothers a lot of people that I’ve talked to over the past few days.

I volunteered this year as a pitch mentor for the other three companies that were in the competition (Skybloxx, Global Crypto Systems, and ProperNotice). Each of these embryonic teams worked extremely hard to make it to the finals of the competition. During our pitch mentoring sessions, ATM Direct was absent – no idea why. But I know the other 3 teams came in and walked away with newly gleaned insights into their stories, and a genuine hope that they had a shot to win and get their companies off the ground. Instead, they lost to a company that had been auctioned off on the bankruptcy circuit (at least once, possibly twice).

In any event, the TAG/GRA business launch competition should be aimed at promoting and fostering the launch of new companies here in Georgia. Unless I am missing something obvious here, I can’t help but feel a little shame in this year’s affair. It sort of reminds me of a 16 year old trying to play on a little league team – great for the team that recruited him, but not terribly fair for the other teams. I suppose one argument would be that since the assets of ATM Direct were sold to Accullink, it is a new incarnation, new company, etc. So that would qualify them for the competition. I still don’t like it, though. It just doesn’t give me that warm and fuzzy feeling that I expect from a winner of a competition like this.

In fact, one could counter-argue since the assets were purchased for $600K, that alone would disqualify Accullink/ATM Direct as that would constitute an investment that is greater than the $500K limit outlined in the rules of the competition. I’d have much rather seen a true green-field idea company in that slot (like the other three contestants).

Nevertheless, I sincerely hope that TAG/GRA addresses this matter at some point, if nothing else than to send a message to would-be entrepreneurs here in Georgia that your dreams and efforts still matter. Due diligence is a good thing. Hopefully, someone from TAG or GRA will come and post here and help make some sense of this.

Cheers.

I just had a moment to watch the various video pitches recorded for the TAG/GRA Business Launch Competition. A couple of quick thoughts:

• A couple of trends -the big clusters seem to be in:
  • Events, finding something to do, connecting with friends, social networking (3 deals out of the 25)
  • Educational plays – of the 25 pitches on the site, 5 of them were in the education space – that’s a very positive trend, in my opinion.
• A handful of the companies listed recently attended one of our PitchCamp sessions. I’ll say this. It is very obvious to me which ones put in the effort. The difference is night and day in terms of getting the core message across.
• Video pitches have the power to turn otherwise normal people into amateur actors. When I watch a 2 minute video pitch, I don’t want to be entertained – I want to learn about the business, the market, the company, the product – the pain. Bringing in your children for cameo roles, doing humorous skits, or hooting and hollering like a used car salesman just don’t get me all that excited. Granted, it leaves me laughing, but at what …. the jokes, or your business? My two cents … your mileage may vary. At the end of the day, an investor wants to invest in your business, not a local chapter of the Screen Actor’s Guild.

Cheers.

Over the past few months I’ve had the privilege of serving as an advisor and mentor to Henry Hipps, a young entrepreneur here in Atlanta who is embarking on a very ambitious, yet noble undertaking with his venture (Trajectory Learning). Henry entered Trajectory Learning into the TAG/GRA Business Launch Competition, which has a cash prize of $100K and $200K worth of professional services. This prize would allow him to really get the business going. He’s worked extremely hard on this, and it is exciting to see it coming together.

Henry participated in a video pitch component, which if he wins it, he will earn a “bye” during the first round of judging. This is the equivalent of the “People’s Choice” category.

If you have a moment – check out the pitch here (it is the second one listed). It is only a couple of minutes long. I’m sure Henry would appreciate your vote as well – if you have a moment, click the “Vote Here” link at the top of the page, and check the deal you like the most (we’re hoping, of course, that it is Trajectory Learning)

Good job, Henry!

Cheers.

According to our good friends Eric Gregg and Allen Maurer at TechJournalSouth, the Georgia Research Alliance is launching a new venture fund (details below). A good move, although I think the amount invested by the state is on the small end. A lot of the research coming out of the universities will require significant amounts of capital (biotech, cleantech, nanotech, etc.) Even though they are getting 3-to-1 matching funds from the private sector, it could/should be more.

Georgia launching venture fund
January 15, 2008
ATLANTA–Georgia is launching the Georgia Research Alliance Venture Capital Fund, Gov. Sonny Purdue told a Georgia Chamber of Commerce Meeting.

The fund will partner the state with private sector dollars to give companies formed around Georgia research university IP early stage financing.

The state is investing $10 million in the fund which will be matched 3-to-1 by private dollars.

This doesn’t help non-research-based ventures at all, but all boats rise with the rising tide, as they say. I still would like to see the state reconstitute and overfund the ATDC’s seed fund, however. It is time they got serious about boosting early-stage fast-growth deals in the private sector. Don’t get me wrong – governmental involvement is very rarely the solution to a problem. But in this case, I think they can send a strong signal, and play an integral role.

I referred a media contact of mine to the ATDC not too long ago. I completely envisioned a role whereby he could offer internal media/public relations consulting services to ATDC portfolio companies. Think about the tremendous advantage that having a free public relations expert at your disposal would bring to a typical startup. I think the ATDC folks liked the idea, but unfortunately, they are a government entity, and are thus susceptible to the normal budgetary constraints that you would expect.

Come on, Sonny. Let’s get it done.  The ATDC has some great ideas for the future, but the impact that they will inevitably have on the regional economy will be directly correlated to their operating budget and their ability to engage the private sector.

Cheers.