Startups pitch for funding at CMU
Jeffrey D. Mullen of Shadyside said he believes the startup company he co-founded two years ago called Dynamics Inc. will revolutionize the debit card-credit card industry.
"We are about to explode. We have a programmable magnetic stripe that allows us to change the information in the magnetic stripe ... to introduce new products to market without having to change 60 million 1970s-era magnetic strip readers or re-educate the merchants that use them," Mullen said Saturday following his business plan presentation at the McGinnis Venture Competition at Carnegie Mellon University's Tepper School of Business in Oakland.
Thirty teams of graduate business students from 24 colleges and universities in the U.S., Canada, Columbia, India and Sweden sought to convince judges over three days that their plan for a prospective business was the best and worthy of startup funding.
Mullen, 30, who plans to graduate this spring with a master's degree in business administration from CMU, was on one of four winning teams.
His business plan for Dynamics Inc., where he is chief executive officer of the Oakland-based firm, won in the competition's technology field. The University of Michigan's team won in the sustainable technology track for a plan to convert agricultural waste into insulated panels for refrigerators. The University of Utah's plans for an orthopedic device to improve surgeries and bone healing won in the life sciences category.
Those winners took home a $20,000 cash prize for investing in their company, while Dartmouth College's team won $1,000 for an "elevator pitch" -- a three-minute presentation.
The students had to impress the judges that their concept is viable, they have the ability to make the plan succeed, and their business plan is sound, said Arthur Boni, director of the Donald H. Jones Center for Entrepreneurship at CMU.
"We tap the business students who are going to bring new innovations into the business world," Boni said.
The McGinnis Venture competition, named after Respironics Inc. founder Gerald E. McGinnis, has been a springboard for plans that were developed into businesses, Boni said.
"We try to bring the students as close as possible to the real world situation because that is what they will face in the real world," Boni said.
In the real world of venture capital, raising money in this economic environment has proven difficult, said Peter M. DeComo, a venture capitalist and the founder of Renal Solutions Inc., a Marshall-based health care firm acquired in 2007 by a German firm.
"Everybody has slowed down. The venture capitalists are reserving cash for their existing portfolio of companies, and if they are looking at new deals, they are looking at fewer ones," said DeComo, a judge in the competition and chairman of ALung Technologies Inc. in the South Side.
Having a good business plan is not a guarantee a company will succeed, said Donald Jones, managing director of Draper Triangle Ventures, a Downtown-based venture capital firm, one of the competition's judges.
"It's the execution and implementation of the plan. The idea will not be successful in its own right," Jones said.