02 Jun Governor’s business-plan contest has a surprise ending
MILWAUKEE – Two biotechnology companies tied for the top prize at the first-annual Governor’s Business Plan Contest. Announced at the close of the Entrepreneurs’ Conference Wednesday evening in Milwaukee, Middleton-based BioSystem Development and Milwaukee-based NovaScan will split both first and second place, or $55,000.
Other category winners, each receiving $10,000, include Sound Focus, Aquamake and IntelliMentor.
“The quality of the business plans was very high,” said Trevor D’Souza, a managing director of Mason Wells and competition judge. “I would hope it to be one of the driving forces of entrepreneurial activity in the state.”
The goal of the contest was to encourage and educate high-tech, start-up entrepreneurs in Wisconsin. Twenty-seven finalists were picked from a field of over 600 entries. A panel of 36 judges evaluated the plans based on business elements such as customer definition and planned use of funds. Entries were submitted in four categories: life sciences, advanced manufacturing, information technology and e-commerce and business services. Judges used a numerical scoring system to rank each plan within each category.
According to Tom Still, president of the Wisconsin Technology Council, the maximum score a company could receive from the judges was 80 and the two winners splitting the prize were a numerical tie. He said they had an oral presentation and tied again, thus the judges declared a tie.
The prize money included, but was not limited to $50,000 from the Department of Commerce and $25,000 from Mason Wells. Overall, $115,000 was available in cash prizes.
State Secretary of Commerce Cory Nettles believes the competition reflects the strength of opportunity found in Wisconsin.
“There was a distinguished group of finalists and we were pleased that we have two winners, one from Milwaukee and one from Madison,” Nettles said. “It also is a great thing that, of the 300-plus contestants, we had very broad geographic representation. It demonstrates the spirit of entrepreneurs across entire state. What gets so much of the attention is the strength of the biotech cluster in Wisconsin, but we have a strong IT cluster as well, particularly in southeast Wisconsin. We’re glad to see so many finalists from the IT business.”
Still added the business plan contest had a specific initiative to expose entrepreneurs to potential investors.
“One was to provide an avenue through which entrepreneurs could bring their ideas forward and actually work on them,” Still said. “The second, a very tangible reason, was to help increase the deal flow in Wisconsin. We figured if we had a significant number of plans that a portion of them would be of the quality that investors, angel or venture, might want to take a look and might want to add this to their consideration list. … Third, and this is more perception than anything, we wanted to dispel the myth that Wisconsin lacks entrepreneurs. We really wanted to do something that would send the message that ‘Yes, entrepreneurs do exist in Wisconsin; they have great ideas and they will come forth if given a chance.”
BioSystem Development: Alternative lab testing ($27,500)
Scott Fulton of BioSystem Development said his product idea came from mmune-system cells. Normal methods require multiple incubation periods in plastic wells for 30 minutes to overnight, Fulton said, meaning the test can take a day or more to complete. BioSystem Development tied for first place in the business-plan contest with its AbMate Rapid Immunoassay System, which aims to simplify the process.
“These assays are notoriously unreliable,” Fulton said. One compahis own work in research labs. “One analytical method kept coming up as a bottleneck,” he said.
That problem was with immunoassays, a way of testing very small amounts of iny, he said, repeated nearly one in three tests due to bad results.
BioSystem developed an automated instrument to perform the tests by pumping reagents through beds of tiny beads, where the necessary chemical reactions are performed, instead of the usual plastic wells. The test takes about 10 to 15 minutes, as it does not require the sitting time the usual test does.
The company plans to sell both installed systems for $50,000 to $75,000 each as well as consumables that could cost that much annually.
The company split the $55,000 first-prize pot, as well as the $5,000 second-place prize, in the life sciences category, with NovaScan, another biotech company.
NovaScan: Detecting breast cancer ($27,500)
NovaScan develops technologies that electronically image biological tissues. The current system evolved out of bomb detector technology and the company is now using it to detect tumors. Initial tests using cow livers and oatmeal plug “tumors” validated the technology’s ability to detect foreign bodies in biological tissues.
Last August, NovaScan became the first company to garner a grant from WiSys Technology Foundation Inc., a subsidiary of the Wisconsin Alumni Research Foundation. WiSys, created in 2000, extends WARF’s reach beyond its home on the Madison campus of the University of Wisconsin.
Now, NovaScan has clinical partnerships with organizations such as St. Mary’s Hospital, said Larry Wells, a co-founder of NovaScan and its vice president of business development.
The technology senses the unique electrical properties of different sorts of tissues, he said. The initial application will be in detecting breast cancer, but after that NovaScan plans to move on to other cancers. Wells said the scan, which does not require radiation or uncomfortable compression, could resolve tumors down to 2 millimeters, an advance over current technology.
“The gold standard is still X-ray mammography,” Wells said. But if that test shows the possibility of a tumor, most patients are referred for a biopsy, which is expensive and can leave scars. Eight out of 10 biopsies turn out negative, he said—meaning a new test could reduce the number of unnecessary procedures.
NovaScan will be an OEM supplier and license its technology, allowing it to get to market faster, Wells said. But clinical trials will push its launch to 2006.
Sound Focus: Beaming sound to your ears ($10,000)
A new Madison company with an invention that can beam sound to specific locations, co-founded by Jeffrey Milsap and J. Michael Underwood, Sound Focus could place its technology in home theaters, museums or classrooms. Its plan won the information technology category.
Milsap said the company’s first target was home entertainment. Customers could install several flat-panel speakers, which Sound Focus’ technology would coordinate in a way that can create a “ball” of sound around a listener’s head, making headphones unnecessary.
“We’re doing this with off-the-shelf components to create a hologram of sound,” Milsap said. “The killer app is that additional software behind this chip will allow the ball of sound to move with the listener.”
Sound Focus plans to outsource production, he said, and will try to keep inventory to a minimum by producing on demand. He said competing products require very precise positioning of speakers and could not cover an entire room well. Sound Focus’ arrangement attempts to fix this problem. Milsap said it does not require bouncing sound off walls or ceilings, which reduces the intricacy of the system.
In addition to entertainment, Milsap sees applications in accessibility and advertising. Visually impaired movie-goers, for example, could hear a narration soundtrack that would not bother those seated nearby. And customers of a store could, after being identified with other technologies, be given specialized messages. Stores that sell floor space now, he said, could start partitioning the air.
IntelliMentor: Learning software ($10,000)
IntelliMentor, a company started in Milwaukee that now has corporate headquarters in Seattle, Wash., and a Chicago office, plans to syndicate its knowledge applications online and allow business consultants to sell them. It is trying to help companies manage change in their conditions as the business world becomes more distributed and diverse.
“There are very few tools for managing people,” said John Solkian, chief operating officer for IntelliMentor.
He said the focus of IntelliMentor’s tools was to get employees’ actions in line with a company’s strategy. The tools use software agents to help mentor people. Solkian spoke of a “virtual change consultant” that would stay with someone consistently and help them manage change in their organization by providing useful information.
The first tool is free, intended to draw in and prequalify potential clients. Solkian said the company’s primary market was smaller companies that usually cannot afford consulting services.
AquaMake: Eco-friendly wastewater recycling ($10,000)
AquaMake, a wastewater recycling system that has been in use in Japan for 15 years, is coming to the United States through Environmental Plumbing Solutions, Inc., a Milwaukee company that won the advanced manufacturing category for its plan. EPS sold its first unit last year.
“In Wisconsin alone, in 2003, there were nearly 14,000 septic permits issued,” said Craig Gravatt. AquaMake, he said, could save thousands of gallons of water in a time when water is in short supply in the area. He said AquaMake is the only such recycling system available in this region.
AquaMake’s fiberglass construction makes it easier to sell to a wide geographic market compared to other water treatment systems, many of which are made of concrete and thus hard to transport. The technology was developed in Japan, where more than 5,000 units have been installed since 1982. When finished, the process leaves water clear, colorless and odorless, Gravatt said.
Previous Governor’s Business Plan articles on WTN
Business Plan Contest Has Good Model 06/12/03
Business Plan Bounty Increases to $105,000 01/21/04
Submissions to the Gov.’s Business Plan Contest Exceed Expectations 02/04/04
Gov.’s Biz Plan Contest announces Phase 2 winners 03/10/04
27 finalists advance in Governor’s Business Plan Contest 04/12/04