Dayna Grayson was previously in Boston at North Bridge Venture Partners, but recently joined as a partner at New Enterprise Associates Inc. Her focus at North Bridge was early-stage ventures, but at NEA, her focus has become broader.
During college, Grayson started an eye-gaze technology, which "basically measured pupil changes in the 90s." She explained that the company pivoted to help the physically disabled as it allowed for the disabled to move the computer mouse with their eyes. Grayson deviated to Cap Gemini Earnst and Young, a consulting firm. Grayson explained that she went to business school and met her employer for North Bridge and joined them to invest in early-stage startups.
NEA is the one of the oldest and largest venture capital firms in the United States. Its unique structure stems from its large fund—$2.6 billion. According to Grayson, approximately 30-40 percent goes to medical investments, China and India. The rest goes into later stage and early-stage startups. The biggest philosophy of NEA is that venture is not an asset class. "The returns of the ventures of the asset class is determined by the larger companies," Grayson said. "What we've seen is that over the last five years, money is cycled back." She also suggested that entrepreneurs follow the money. "It's what makes everyday operations," she said.
The investment style that Grayson adopted is to look for great entrepreneurs. "They see things differently," she said. "They see a different angle. If you've got a great innovative edge and a unique angle, you can go after it, but you're limited by how big the problem actually is. We look at how you're going to move the needle in the industry." As of now, Grayson is interested in privacy, customer application, mobile and the ad tech space.
She also gave pitching hints to the entrepreneurs. "To pitch, focus on how you see a problem and you can solve it. Do you have the angle?" she asked. "It's always daunting at first, but you do have to drill down. You need an ability to show milestones that you've set and achieved. You need to have some sort of product ready and of course, consider the market size," she said.
Jason Liang of BringMeThat was first to pitch. "BringMeThat lets you order from any restaurant in the United States," Liang said. "Platforms like Seamless and GrubHub only are available in the Top 15 cities in the US, which is only 10 percent of the market. Instead of going out with large sales teams, we created an algorithm to get menus from restaurants." BringMeThat's experience is very similar to Seamless.com, except that on the backend side of the platform, someone from the BringMeThat team actually calls the restaurant for the user. BringMeThat is currently in 1,500 restaurants in Ohio. According to Liang, the platform generates an estimated $1,000 per week in revenue. "We're not going after the Top 15 cities where Seamless and GrubHub are currently operating in," Liang said. "We're focusing on college towns and hope to partner with consulting firms to build up awareness." At this point, Grayson suggested that Liang and his team look at the economics and think about more human intervention in terms of maintenance and keeping the data fresh due to the rate of restaurants going in and out of business.
Next, Sindy Sagastume of TheOddSlipper pitched her idea of a woman's fashion marketplace aimed at women with petite builds. "The top underserved women in fashion are petite," Sagastume said. "Most industries use 5'5" to 5'7" tall women, which is about 70 percent of the fashion industry. Women's fashion industry is worth $11 billion dollars, but they're missing out on $5 billion because petite women are either not purchasing or purchasing from children's stores to get clothes that fit them." Sagastume revealed that she is dedicated to building the first app aimed at petite women. "It will be a cross between Bonobos, Warby Parker and Lane Bryant," she said. Her goal is to bring petite women together using the internet using collaborative consumption and crowdsourcing. "My target is mid-market petite brands," she said.
Roger Wong of WireLawyer pitched his product next. Wong said he and his team were creating the first B2B network for lawyers to outsource work. "A lot of lawyers are underwater," Wong said. "People are leaving law firms and starting their own practices. About 75 percent of legal space is small to medium-sized firms. It is highly specialized and fragmented," he said. Wong revealed that WireLawyer gets leads from other lawyers and is targeting a $300 billion industry. "It works like a referral," Wong said. "You get a referral to a lawyer from other lawyers." He gave an example of a customer looking for a divorce lawyer, but only knew a real estate lawyer, but through using the product, the real estate lawyer referred a divorce lawyer to the customer. "The way we monetize is through subscription fees," Wong said. "And hopefully volume will help us sustain that model. What we're doing is creating a sticky network and right now, we're providing a free contract search for these small to medium-size firms."
David Navarrete of Peachy Mobile Inc. pitched his platform, PGMobile, a mobile marketing solution aimed at the sports and music industry. "Working with Keith Richards," Navarrete said, "I learned a lot about understanding the fan base and how to cater events to them. There is no real way to unlock passionate fan bases on mobile. Ticketing is done through a lot of secondary ticket sellers and the host doesn't know who is attending, who bought the tickets. The host of the event wants to know real-time, immediately and use mobile to know who is attending. PGMobile is the solution," he said. "It makes sense to leverage acts—hosts of large-scale musicians and sporting events can track attendees in real-time." Navarrete explained that his business model was to be a B2B subscription model and has already gained its first customer—Warner Music.
The last pitch was done by Cory Bishop, founder of Zoot-It. "Do you follow your favorite boutique store?" Bishop asked. "If you do, Zoot-It helps you know when the store is having a sale using push notification if you are in the vicinity." Zoot-It is currently in Alpha and has 30 people trying out the app, with 100 people on a waitlist for the Beta to come out. "We have 10 stores signed up for Zoot-It," Bishop said. Regarding the app, Dayna Grayson said, "local retailers need foot traffic and Zoot-It seems to be trying to answer that, but the biggest challenge is that will it solve that problem?" Bishop answered, "Zoot-It is helping boutique store to market themselves and hopefully in the future, it will be able to scrape Twitter API and other social media. It could eventually suggest stores to increase discoverability." Zoot-It plans to create a tiered model—charge for profile creation, charge to get location-based prompts and charge for analytics—as a