Beyond apps: These startups are tackling real-world problems
Startup incubator Y Combinator demos a refreshingly high volume of companies tackling real issues, from hearing loss and elderly care to immigrant hiring and sending money home.
Hopes, dreams, and buzzwords were in good supply Tuesday as startup incubator Y Combinator held its 17th Demo Day at the Computer History Museum in Mountain View, Calif. Featuring 49 newly minted and potentially lucrative companies and a roomful of hungry investors, the day-long affair granted young entrepreneurs a chance to secure the next startup stepping stone while also framing the current tech landscape over the course of roughly three hours of elevator pitches.
But what was once a springboard for major players in now-colossal markets like shared services and consumer cloud storage has of late been consumed by the mundane, overdone, or just outright indulgent. This year was no exception: there were not one, but two food delivery services; a laundry delivery company; a flower delivery company; another supposed email killer; and a company that hopes to replace physical restaurant menus with digital versions on your tablet. You can hold your applause.
Even once you excuse, as Y Combinator cofounder Paul Graham pleaded, the miserably constructed descriptions -- Stripe for this and Uber for that -- it's still difficult to believe that any of the recent startup school candidates will ever grow into tech darlings like Airbnb or Dropbox did.
But while get-rich-quick is still the primary Silicon Valley catalyst -- and plenty have criticized copycat startups hungering for an Instagram-like success story -- Y Combinator's most recent batch featured a refreshing number of companies that should give us hope that some young entrepreneurs are still out to change the world for the better.
Take for instance SoundFocus. Cofounder Alex Seig, who took the stage to give his startup's pitch, has suffered from hearing loss all his life and decided to channel his disability toward helping others overcome the enormous financial burdens of standard hearing aids that are typically not covered by insurance. Using an app that adjusts to a user's particular hearing deficiencies, SoundFocus tunes music from your library or Spotify for the best result. Down the road, the company plans to produce wireless earbuds that will bring its assistive software to any and all sounds, not just music.
Then there is Regalii. "Ever since coming to this country, 20 years ago, I've been sending money home every single month," cofounder Edrizio De La Cruz said during his pitch. Started in 2011, his company allows immigrants to send financial support to families living in Latin America without the hassle of middlemen like Western Union that charge high handling fees, are inconveniently located, and are often the target of criminals. Regalii can send funds directly via SMS for a flat transfer fee of $3, which family members can then use at partner establishments.
(Another company that demoed Tuesday, Buttercoin, provides a similar remittance service, though with Bitcoins to allow for easy, almost fee-less international transfers.)
Two other standout startups are aimed at aiding the elderly. Amulyte was plugged as the modern day Life Alert, and provides a high-tech pendant equipped with GPS, Wi-Fi, and an accelerometer to make the destructive element of falling for fragile senior citizens more quickly addressable. And True Link pitched its credit card for the elderly, which allows one's parent or grandparent to maintain financial independence while also having all transactions routed through the company's servers. Once the data is there, True Link analyzes it for known scams or manipulative tactics.
While these companies received their fair share of praise from the demo day attendees, it seemed as if the investor highlights of the event were the presenters most transparent about their money-lined motives. (Not helping these young entrepreneurs is the fact that two gleaming Maseratis sat near the building's entrance, and counting the number of Teslas patrolling for parking spaces would result in you running out of fingers.)
It's the reason why nearly ever presenter couldn't get through his or her pitch without desperately dropping the phrase addressable market, or illustrating rudimentary multiplication on the projector screen to show how many billions of dollars they could theoretically make if all went according to the master plan.
For example, take one of the stars of the show, SpoonRocket, an organic food delivery service that charges only $6 a meal and was described exuberantly as "fast food 2.0" and the "the Uber of food." While it's a great idea -- the service cooks only one meat and vegetarian meal a day in bulk and delivers with heater-equipped trucks -- the presentation was an almost comical display of Valley startup priorities.
"We are a money-making machine," cofounder Anson Tsui said with slow pauses on the words that were eventually met with jubilant laughs from the crowd. One could almost forget that SpoonRocket was actually providing healthy, organic, and inexpensive food to those who might otherwise not be able to get it.
Tsui ended his pitch with, "Remember, the rocket ship is taking off," receiving the most receptive applause of the day. The crowd didn't seem to care where the rocket was going, or how long it would stay in the air, but rather that it just be going skyward, toward that beautiful multi-billion dollar "addressable market" we kept hearing so much about.