Stanford has several student-run startup accelerators, which have helped companies like Boosted, Athelas and Skybox Imaging flourish. Some widely-attended annual events include the 100k Startup Challenge, hosted by the largely undergraduate-run Business Association of Stanford Entrepreneurial Students (BASES), and VC3, hosted by ASES, a Stanford-based global entrepreneurship group.
But certain demographics, particularly graduate students, crowd the startup scene, maintaining a distinct presence at events hosted by majority-undergraduate student organizations. Cardinal Ventures, an on-campus, student-run startup accelerator, actually considers school year in determining which groups are accepted into its program. One-third of teams are undergraduates, one-third come from the Graduate School of Business and one-third originate from other graduate-level programs.
While other startup programs are beginning to work in specific competitions and categories for undergraduate teams, many of the top prizes continue to be dominated by teams of graduate students.
BASES and non-dilutive funding
BASES Challenge, hosted every spring, welcomes all Stanford affiliates to pitch an idea to a group of local venture capitalists (VCs) and potentially earn non-dilutive funding for the startup, meaning founders do not have to give up any ownership shares or equity in their company. Participants can enter their pitches into one of four categories: consumer, enterprise, medical or social impact.
The event consists of several rounds, including a kickoff mixer, where students can meet VCs and find potential teammates; an online pre-screening round; a qualifying round, where the top 10 teams from each category are chosen and a final round, where a winning team is chosen from the four categories.
This year, three of the four top teams were majority graduate students, which BASES Challenge Vice President Renee Li ’21 described as a trend for the event. In response, this year’s event featured a new $10,000 undergraduate reward for the best all or majority undergraduate team to incentivize their participation.
“We’ve seen that [Challenge] attracts a lot of graduate students,” Li said. “I think it may be that graduate students … have work experience and are more comfortable and confident presenting their ideas and going the entrepreneurship path. I think that it’s definitely true that a lot of the winning teams have been graduate majority.”
When asked to share statistics about this year’s Challenge participants, BASES declined to make the data public, stating that it wants “all Stanford affiliates to feel welcomed to participate and compete in the BASES $100K Challenge, and we don’t want the statistics to sway anyone’s decision to participate or not.”
In April, BASES Challenge awarded its top prize of $45,000 to SwellStop, a medical device used to reduce ankle swelling, so a patient with a broken or fractured ankle can get surgery right away.
The SwellStop team — like last year’s BASES Challenge winner Synapse Technology — was composed mostly of graduate students. The winning team consisted of five members, including two Ph.D. students in bioengineering, one mechanical engineering student pursuing a master’s degree, one M.B.A. student and a retired orthopedic surgeon who formerly served as head of surgery for Kaiser Orthopedic Surgery and had just completed the Distinguished Careers Institute (DCI) program.
“[We had] two main reasons [for] wanting to participate,” said James Kintzing, Ph.D. ’19. “One, obviously, the non-dilutive funding is really helpful for early stage startups. And then secondly, just additional exposure and publicity, generating a buzz.”
SwellStop’s history began in January 2018, when the team met and participated in a two-quarter, graduate level Biodesign Innovation course, which Kintzing said prompted the team to “spend a lot of time researching, interviewing physicians and validating a need before inventing something … and developing a solution.” The device actually won “Best Solution” at Stanford Byers Center for Biodesign’s second annual Health Technology Showcase.
Last year, SwellStop also participated in the Cardinal Ventures accelerator, a ten-week speaker session and workshop series that is currently part of the StartX Student-In-Residence (SIR) program. The startup has a working prototype, cold business plan, provisional patent and is working on a 3rd-generation prototype for its first round of clinical trials, which Kintzing anticipates will happen in the beginning of 2020.
“The 45K will be really helpful in continuing to develop and build out these hundred units that we need for our preliminary clinical trial,” Kintzing said. “We’re in the process of converting to a full patent through Stanford Office of Technology Licensing (OTL), so it will also help cover some of those fees.”
In addition to non-dilutive funding, BASES Challenge provides participants with exposure to potential future investors and according to Li, validation from “knowing enough VCs believed in you to send you to final round.”
VC3 and making connections
VC3, an annual entrepreneurship event put on by ASES, focuses on fostering communication between student ideas and experienced venture capitalists. The daylong event brings together 15 VC firms from Silicon Valley and 15 Stanford affiliated startups for “one-on-one rotating pitch sessions,” where each startup pitches to each VC and receives feedback and potential contact info to follow-up.
“Because there are so many entrepreneurial students on campus working on projects, they don’t really have direct access to VCs,” said VC3 Co-Director Isabelle Zhou ’21. “The main point of VC3 is to give students exposure and access to these 15 VC firms all across Silicon Valley and feedback on their pitches, so they know how to iterate it for future purposes.”
Similar to the BASES Challenge, this year’s VC3 event mainly included graduate-majority startups, but Zhou said the mix “fluctuates year by year.” This year, out of the 36 teams that applied, 14 were majority-undergraduate, 14 were majority-graduate and 8 were unspecified. Of the graduate teams that applied, only one was rejected, four were waitlisted and nine were accepted. Conversely, eight of the undergraduate teams were rejected, two were waitlisted and four were accepted.
Tempo, an undergraduate startup founded by three seniors, was one of the four undergraduate teams accepted to VC3. Amid all the graduate student teams, Tempo has recently managed to both make an entrance in and stand out in Stanford’s startup scene. It won first place and $1000 in the 2019 Start-Up Nation Pitch Competition, was featured on the Stanford podcast Founders Couch and joined this year’s StartX Student-in-Residence (SIR) summer cohort, which provides non-dilutive, grant funding and office space for the summer.
Tempo, previously called Tampro, was created in Fall 2018 as a project for ENGR 145: Technology Entrepreneurship. The company is working on a patent-pending technology, redesigning the structure and material of tampons to prevent leakage.
“When you feel your tampon leaking, you pull it out, and it’s not fully saturated,” said Tempo Chief Executive Officer (CEO) Greta Meyer ’19. “We found the issue was, mechanically what we like to call, leakage channels that were funneling material away from the absorbing core. Essentially, we’ve taken those channels and made them into a spiral, which extends the time it takes for the fluid to reach the bottom and increases surface area and expansion potential.”
In less than a year, Tempo has raised $30,000 in non-dilutive funding and is waiting to hear back from another organization, from which the company could raise the total to $50,000. The startup is currently settling contracts with manufacturers and has plans to launch its product in the United Kingdom this summer.
“It’s not a medical device [in the UK], but there is still a lot of regulation, as there should be,” Meyer said. “But, it’s less time consuming and costly to comply with [those regulations]. I think launching in the UK will be great in terms of generating data about what’s sticking and what’s not.”
While Tempo has had success making a name in Stanford’s startup scene, Meyer noted the challenge of finding time amidst school work and how navigating the space has been “more and less connected than one would think.”
“If you have specific asks, you can ask the community for that,” Meyer said. “But in your day to day, it’s like you’re kind of floating, at it alone.”
FriendChip — another undergraduate startup developed in ENGR 145 — allows users to invite friends for casual, spontaneous activities by placing a “chip” on a map. FriendChip’s founders described Stanford’s startup scene like “Fight Club.”
“The startup scene is often surrounded by a ‘don’t talk about it’ attitude … students seem tired of hearing students pitching their startup,” said co-founder Christopher Lin Xin Lu ’20. “As such, it becomes harder to build a community since you don’t know whether someone outside your social circle is actively involved in a startup.”
Lu and co-founder Jack Gartland ’20 conceptualized FriendChip at the end of 2017, after “freshman year friends became scattered across campus, and it became hard to just hang out.”
Despite FriendChip’s success — its daily active users have grown about 150 percent in the past month and the startup hopes to launch an Android-friendly app this summer — Lu said there was a “lot of rejection and uphill battle” before getting to this point. For example, the startup was rejected from the StartX SIR program, VC3 and its first attempt at Cardinal Ventures before being accepted to the Fall 2018 cohort.
“A lot of graduate students probably have had more internships, so they know more about about kind of what’s happening out there in the world,” Lu said. “But as undergrads, we’re a lot more excited about the opportunity … and what I realized is that our potential and the learning that we’re able to achieve is much larger than what graduate students get out of the program that Stanford offers.”