CAMBRIDGE, Mass., May 25, 2004 — Barnas Monteith enjoyed a young entrepreneur’s dream day last week: a sunny May afternoon on the MIT campus, no deadlines to meet, and a cocktail party packed with investors looking for the next big thing.
The schmoozing ran full throttle. There was Greg Schmergel, chief executive officer of Nantero Corp., waiting in line at the bar. The crew in charge of Analog Devices’ MEMS division wandered by. A crowd gathered in a semicircle around legendary venture capitalist Vinod Khosla, like students flocking to Plato.
And in the middle was Monteith, co-founder of Advanced Diamond Solutions Co. His company was a finalist in MIT’s famed $50K Entrepreneurship Competition. In two hours the school would announce the winner.
“Hanging out in the tent having four or five wines,” he said with a chuckle, “yeah, that was nice.”
Advanced Diamond was one of three small tech business plans to squeak into the $50K finals this year, with its technology to make a diamond-copper composite that acts as a coolant for microchip components. The others were Active Spectrum, a startup using MEMS to build a transceiver for wireless devices that can handle multiple frequencies; and LumArray, with a nanoscale lithography technique that eliminates the need for costly design masks.
What’s at stake in the $50K? Cash, certainly. The winner receives $30,000 and two runners-up get $10,000 each. The contest also brings priceless prestige; investors take notice, doors open, business plans incorporate.
Planning starts in the depths of winter, when hundreds of teams enter the school’s preliminary $1K Contest to win seed money and encouragement to press forth. As the weather warms up, student teams convene at any of MIT’s several campus bars (the Thirsty Ear is popular) to proofread plans and review PowerPoint presentations. The denouement arrives on the second Wednesday in May, when the winner is selected.
“It’s really an amazing experience,” says Othman Lareki, co-founder of Active Spectrum. “It gives a very good pacing. It makes the team coalesce around a target.”
Nanotech strode onto the $50K stage two years ago, when a company named SuperBright reached the finals with a plan to use nanoscale manipulation of photonic crystals to improve the brightness of flat-panel displays. The startup lost, and never incorporated.
Last year proved far better for the small sciences. Four 2003 finalists had plans that touched on MEMS or nanotech; one of them, SmartCells, won the prize for its idea of using insulin-laced nanoparticles to fight diabetes. Today the company has hired a chemist and head of operations, and is “continuing to pound the pavement for more investors every day,” founder Todd Zion said. He hopes to close a round of funding and move into new digs later this summer.
This year, the $50K’s small-tech trio faced stiff competition from four other finalists, among them a medical-equipment startup with a brace to help paralytics regain motion in their elbow; a software company that lets children compose music using colorful visual software; and an engine that uses liquid rather than metal pistons for greater fuel efficiency.
At 7 p.m. more than 300 people crowded into the MIT auditorium. Khosla delivered an upbeat talk on the state of innovation. He touted two portfolio companies, ZettaCore and Silecs, that dabble in molecular electronics and semiconductor materials.
“Some people call it nanotechnology. I just call it new materials science,” he said. The words are music to the ears of Lareki and Monteith.
After Khosla, the seven finalists gave brief presentations to the audience. Judges actually decided on the winners several days earlier, and organizers (students from the MIT Sloan School of Business) invited alumni to the podium to announce the victors.
Third place went to the startup developing liquid pistons, second place to the musical software business. That left LumArray, Active Spectrum and Advanced Diamond jockeying for the top prize, along with Active Joint Brace, the company making braces for paralytics.
Monteith leaned forward in his seat. His eyes fixed straight ahead. His hands were clasped together in his lap, a taut smile on his face. The chairman of MIT announced the winner.
The gleam faded from Monteith’s eye and the smile assumed the faintest hint of a grimace. Then, like everyone else in the room, he applauded.
Despite the nanotech shutout this year, all three small-tech teams have remained upbeat. Active Spectrum is building a prototype transceiver, and potential buyers in the defense and semiconductor industries plan to inspect it next month.
Advanced Diamond has actual customers — in fact, Monteith’s team had only two days to whip up its 40-page business plan, after a quick trip to Silicon Valley. (“We pulled two all-nighters to do it,” he said. “That wasn’t the best idea.”) And thus, three more nanotech businesses enter the world.