By SUSAN LAHEY
Reporter with Silicon Hills News
The competition among the finalists at Friday’s Texas Venture Labs Investment Competition was fierce. But the winner, recipient of $135,000 and entry to the Global Venture Labs Investment Competition, was Seismos, a company that uses CO2 and sound waves to free up incremental amounts of oil reserves left underground after drilling.
The two other winners were GluTact, a company that plans to bring to market a contact lens that reads glucose levels in diabetics, and BeatBox Beverages, an Austin company that creates volume quantities of party drinks that appeal to the Millennial generation.
The competition was held by Jon Brumley Texas Venture Labs accelerator at the AT&T Executive Education and Conference Center. The judges, Isaac Barchas of Austin Technology Incubator, Morgan Flager of Silverton Partners, Shelley Hossenlopp, Spot on Sciences, Robert Reeves, Datical, and Jerry Sullivan, a retired venture capitalist, were instructed to judge solely on the basis of which company they would invest in, if they had $1 million to invest in one company. All entrants were Texas-based companies.
Friday’s competition was the final five, whittled down from 60.
The winning company had one clear advantage: They were developing software to be used on existing machinery in a space worth $4 trillion, which soundly trumped the profit potential of other competitors. Team members pointed out that two-thirds of oil tapped in drilling remains underground, trapped in the rock. Even freeing a small portion of that oil, they estimated seven percent, could result in billions of dollars of profit for oil companies as well as 60 more years of oil production for the U.S. Various methods of extracting the oil have proven environmentally dangerous and expensive.
One method that is less damaging than, say hydraulic fracking, is releasing CO2 into the ground where the oil is, releasing the oil. But in the process, CO2 gets stuck and increasingly smaller amounts are available for recycling. The problem, oil industry executives and engineers confirmed for Seismos, is that they are “operating blind” and can’t see where the CO2 is going or where it’s stuck. Seismos is preparing to license a software technology invented by a scientist at Berkley University that uses sound waves to map the path of the CO2 as well as the location of oil underground. The process would cost oil companies about $3.5 million per year as compared to about $38 million per incident of current mapping technologies which require a well to be shut down for a period of weeks. Presenters were looking for an infusion of $2 million, beginning with a $500,000 investment.
Seismos was the last presenter, seeking money to obtain the license and conduct testing. After the group’s presentation, the judges were silent for a moment before several of them said it was “an excellent presentation” and Shelly Hossenlopp noted it sounded “almost too good to be true.”
The group had a relationship with the scientist who discovered the power of the sound waves and is preparing to sign a license agreement. One of the other groups that won, GluTact, isn’t quite so close to claiming the technology it hopes to bring to market.
GluTact presenters pointed out that one in ten Americans currently has diabetes and by 2050 the Centers for Disease Control projects, the number will be one in three. Consistent monitoring of glucose levels is crucial for managing diabetes but current methods require people to prick themselves, draw blood and use a glucose monitor and test strips. It’s messy, the test strips cost roughly $1 each, and it’s not something people want to do in front of others. Because it’s a hassle many diabetics just don’t do it.
Tear fluid, however, also accurately reads glucose levels. Researchers at the University of Washington have invented a contact lens whose outer ring reads the levels and sends a radio signal to a card that registers what glucose levels are when the person looks at it. The cost is approximately the same as existing monitoring methods. GluTact seeks to bring the technology to market. The group is planning to seek funding from sponsors in the medical device and healthcare fields and is hoping to secure the patent for the lens.
The third leading team is BeatBox. The Austin company has created an alcoholic beverage that meets what it says are the three requirements of Millennials—good taste, good value and high alcohol content. Millennials, presenters said, are all about to be of drinking age. They’re not content to throw a party with a keg of beer. Men buy most of the alcohol for parties and they want to serve beverages that will appeal to women. The company’s first offering is a raspberry-lemonade flavored drink with an orange wine base that tastes like vodka. The company has already obtained all the necessary licenses to create the drink, has a manufacturing plant, a top-tier packaging partner and has hired a law firm and a distribution company. It was seeking a $100,000 loan at 11 percent interest to be paid or converted to stock after three years.
The other competitors received honorable mention.
Intelligent Menu is a restaurant app that would perform the functions of other apps, allowing customers to identify specific food items by location, make reservations, and order food from their own phones using a QR code. The app would provide detailed analytics to restaurants. The analytics would pinpoint the success of specific food items and highs or lows could help restaurants identify the cause of falling or rising customer satisfaction. Who was cooking at that time of day? Who was serving?
The group’s research showed restaurants could improve table turnover by seven percent by giving customers control over the ordering process. Customers would also be likely to purchase more high margin items items like appetizers, desserts and alcoholic beverages.
EduSex is a company that repurposes content from the CDC into a sex education app geared toward adolescents. It begins with gestures as harmless as hugging and evolves from there. Parents can choose which information they want their children to have on the app and preferences are saved with a login. Presenters said their main target audience was divorced dads who didn’t know what their spouses were teaching their sons and feared their sons were experiencing shame around sexual feelings.
Research shows, presenter Harry Lindner said, that most of these conversations take place in cars when “Parents don’t have to make eye contact and the kid can’t leave.”
The group plans to extrapolate the idea to other formats, such as books and other topics like bullying and drugs.