On September 12 at the Hotel Irvine, the Orange County Business Journal held the inaugural Emerging Innovator Forum in partnership with UCI Applied Innovation. The forum featured an expert panel consisting of angel investors, venture capitalists, and investors representing family offices. Additionally, three Orange County-based startups pitched for a grand prize of $7,500. The larger goal of the event was to help innovators gain visibility in the business community and learn from their peers.
Before the panel, Richard S. Reisman, publisher, and CEO of the Orange County Business Journal introduced Richard Sudek, executive director and chief Innovation officer for Applied Innovation. Following the introduction, Sudek provided an overview of the Southern California innovation and entrepreneur ecosystem. “We want to be Silicon Valley’s best partner,” said Sudek, clarifying that a great opportunity is in collaboration, rather than competition with the Northern California startup and tech hub. Sudek described Orange County as an area with a highly educated and talented workforce and mentioned that a concerted effort such as the Alliance for Southern California Innovation exemplifies people rallying together to nurture and accelerate the growth of a technology epicenter in the region. The Alliance consists of notable industry leaders Qualcomm, Latham Watkins, LLP, CAA, Paramount Pictures, and university leaders Caltech, UCSD, UCI, USC, UCLA, USD, UCSB, UCR, Sanford Consortium for Regenerative Medicine, and Harvey Mudd College. The Alliance is expected to improve job prospects locally for university graduates and help attract additional sources of funding and investment in the region.
After the overview, Sudek started the panel with introductions, which included Jim Armstrong, managing director for March Capital Partners; Amir Banifatemi, managing director of K5 Ventures; Paul M. Cate, CEO of Mark IV Capital Inc.; John Harbison, chairman emeritus, Board of Governors, Tech Coast Angels (TCA); and Grant Van Cleve, President of Tech Coast Angels (TCA) and CEO of Buy It Installed, Inc. Following introductions, Sudek posed the first question of the panel, discussing trends in equity financing. Harbison mentioned that in recent years, he has seen more early-stage companies prepared with validated proof of concept, resulting in TCA investing larger sums in each company than ever before. Armstrong added that a “hollowing out of the middle” happens for startups that face challenges with follow-on funding as more VCs are looking to invest in companies in the late-stage, after significant growth and continued market validation. From an angel investor perspective, Van Cleve mentioned that angels are doing more follow-on funding, citing examples of companies that have grown toward exit or IPO without ever engaging VC money.
The next question posed to the panel discussed the most common industries where investor groups tend to invest most. Cate shared that recent investments included Gengirl Media, a graduate of the Cove incubator program, Cove tenant, and UCI-alumni led startup, in addition to companies in IoT, medical devices, diagnostics and more. Banifatemi mentioned that his fund was diverse in their portfolio, relying on fellow members who may have the expertise to qualify the companies and investment opportunities. Additionally, he prefaced that investors should be mindful whether the startup’s industry has a steady pipeline of investment capital. Without this, it may be difficult to raise additional funds to progress in the long term.
Following a Q&A from the audience, the forum concluded with a pitch competition where three Orange County startups, Meridiun, FunBand, Inc., and Evasyst presented. Meridiun, a mixed reality platform company for the enterprise, discussed how they are building intelligent interactive experiences to solve real business issues for some of the world’s biggest brands. Next, FunBand, a startup in the Wayfinder incubator program, presented their data intelligence platform for amusement venues to enhance the guest experience. Finally, Evasyst, a unique software application that enables real-time visibility, communication, and management of teammates through audio, visual, and social solutions for gamers, presented their solution. After the panel of judges conferred, Evasyst was chosen as the winner of the competition, taking home the $7,500 grand prize. Reisman ended the day by thanking attendees and mentioning that the forum was the first of many to come.