A start-up that produces healthy baking mixes and another that provides online reservations for small hotels in South America tied for first place in this year’s Edward L. Kaplan, ’71, New Venture Challenge (NVC).
The final round of the 2014 competition showcased nine teams who presented their businesses before a panel of judges at the Harper Center on May 29. The competition began earlier this year with a field of 81.
The NVC is a premier start-up program based at the Polsky Center for Entrepreneurship and Innovation. A rigorous process of coaching, continuous feedback, and introductions to investors helps students turn their ideas into viable businesses.
This year’s edition ended in a tie between baking mix company Simple Mills and hotel reservation service RoomVa. Katlin Smith, founder and CEO of Simple Mills and a first-year MBA student at Chicago Booth, developed the concept for her business after a friend suggested that her joint pain might be related to the food she was eating. Her team’s journey through the NVC is documented through a video series produced at Booth, An Entrepreneurial Journey.
As a result of cleaning up her diet and improving her health, she was inspired to launch a baking mix company that uses simple ingredients free from gluten, dairy, and soy. Her NVC team includes Booth MBA students Jessie Yu, who is CFO, along with Arin Aghazarian, Hiral Arges, and Angie Dobrofsky.
“The problem came when I went to the grocery store,” Smith said. “Everything at the grocery store had a lot of sugar in it—ingredients I couldn’t pronounce, highly processed flours—so I started Simple Mills.”
RoomVa was created to solve a problem faced by young couples in Latin America who have difficulty finding hotel rooms when they want privacy overnight. RoomVa CEO Diego Santa Maria, a first-year student and a native of Peru, told the judges that many young adults live with their parents. When they want an evening or weekend away with a partner, they book rooms in small hotels known as telos.
“Last time I went to my usual telo with my boyfriend, it was fully booked,” RoomVa team member Belen Romero said in the presentation. “So, we had to drive around for an hour to find another telo, and when we finally found it, it was too expensive.”
RoomVa’s web-based model, helps not just couples, but benefits the telos by bringing them more business, Santa Maria said. His team included Booth students Maira Boamorte, Hendrik Verploegh Chasse, Matias Chomali, Hugh Gibbons, Son Nguyen, and Javier Sierra.
Santa Maria said working with NVC helped hone leadership skills vital to building a successful business.
“It’s not just developing the idea that is a challenge, but how do you motivate people, how do you make people do their best?” he said. “Many of those things I learned here at Chicago Booth.”
Simple Mills and RoomVa each will receive a $30,000 cash prize, as well as a number of in-kind services to continue to enhance their companies and develop strategic planning.
The judges—seasoned professionals from top venture capital firms, private equity firms, start-ups, and investment banks—agreed that both teams demonstrated well-developed business plans with high growth potential. Simple Mills, which has the top-selling muffin mix on Amazon.com, sells mixes in Whole Foods stores and is in the process of growing its distribution four-fold. RoomVa has signed 43 participating hotels, with increasing usage rates.
“They were viable businesses with great ideas and teams that I thought could execute,” said judge Bryan Johnson, ’07 (XP-76), founder of Braintree, a winning company in the 2007 NVC.
NVC judge John Oxaal, ’81, general partner of Sevin Rosen Funds, said this year’s finalists gave strong presentations that exemplified their refined strategies.
“They both had very evolved business plans. In the case of Simple Mills, they had a business model, which had a very good contribution margin, and they looked like they had a very good expansion strategy. In the case of RoomVa they had already signed up 42 or so hotels and the usage rate in those hotels was going up substantially.”
- AutoBike placed second and received $20,000 in prize money. AutoBike makes an automatic transmission system for bicycles.
- CreditServe placed third and received $10,000. CreditServe gives service members access to credit through a network of active-duty military borrowers and institutional and individual investors.
- HighStride placed fourth and received a $5,000 prize. HighStride is a web and mobile app that provides personalized training to runners.
This year’s other finalists include Ameus; Inscites Research, Inc.; Janus Choice; and SmartLine. Each finalist received $2,500.
Winners of the 2014 the John Edwardson, ’72, Social New Venture Challenge, which launches businesses with a social impact mission and a plan for financial sustainability:
- Hello Tractor won first place, receiving a cash prize of $30,000. Hello Tractor rents two-wheel tractors to small farmers in Nigeria to increase crop yields and combat against income and food insecurity.
- Moxie Leadership Academy placed second and received $20,000 in funding. Moxie provides STEM and confidence-building programming to middle-school girls in low-income communities during the summer.
This year’s finalists include FarmStacker, HeroTechForge, InterChange, and YogaCare.