From an organic yerba mate company to an app that connects travelers in developing countries to local tour guides, 16 teams of college students from around the state donned their best suits and pitched their ideas Thursday during the 26th annual John Ruffatto Business Startup Challenge at the University of Montana.
The day started at 8 a.m. sharp when each team delivered a 60-second “elevator pitch” to business leaders acting as judges.
They then gave longer presentations using slideshows, and the teams were slowly whittled down to four finalists: United Methanol Corp., Purus Inc., GeoFli and Doces Brasil.
Purus is a Montana-based company dedicated to engineering sustainable wastewater treatment for the oil and gas industry, including systems that convert brackish waste generated at the wellhead into clean water and high-value byproducts.
United Methanol is a clean-tech company focused on the conversion of low-value woody biomass into high-purity methanol and liquid carbon dioxide using a mobile and modular processing system.
Doces Brasil is an artisan chocolate company in Missoula that produces and sells high-end Brazilian Brigadeiro, a creamy, bite-sized chocolate ball covered with nuts, sprinkles or other unique delicacies. Co-founder Leo Esteves says they have a much different taste and texture than bonbons or truffles.
GeoFli is a system to display unique website content based on a visitor’s exact geographic location, specifically designed for higher education institutions.
Donald Gaumer, director of the competition, said each team had volunteer coaches and every panel of judges was comprised of successful and knowledgeable business people who donated their time.
At the end of each pitch, they grilled students on how they expected to generate revenue and how their business model worked. Each team had to have a solid plan just to make it to the challenge.
“It’s a competitive process to get into the final day,” Gaumer explained. “We have somewhere between 20 and 35 teams, depending on the year, that submit. It’s a statewide competition open to every two- and four-year school in Montana. The biggest metric is prize money. This year, we’ve hit quite a milestone. (At the awards ceremony late Thursday night), we will give out over $50,000 to our students.”
The first-place team will receive $15,000 and the fourth-place team $2,500. The teams get 30 percent in cash and the rest is available for startup costs if they execute the business. (Check Missoulian.com and Saturday's Missoulian for results of the competition.)
“Over the years, out of the competition has come more than 65 businesses that have started up,” Gaumer said. “The latest ones that are real visible to Missoulians are Five on Black and Market on Front. And then, people probably don’t recognize it, but American Expedition Vehicles, which is a company with research and development focus in Missoula and manufacturing in Detroit, but that came out of this. And many, many more.”
Gaumer said he was impressed with the quality of the pitches.
“A lot of the business ideas that come here are not everybody’s cup of tea, they’re unique,” he explained. “We’ve got numerous service organizations that do everything from optimizing presence on the Net to doing videos. It’s a broad spectrum.”
The event is put on by the Montana Academy of Distinguished Entrepreneurs and a long list of sponsors, and is named after a retired Missoula financial consultant.
“The entire execution of this thing is a volunteer effort,” Gaumer said. “These judges come from the local community, and many have alumni attachment to the University of Montana and they come here on their own dime from places like Chicago and Seattle to continue the process of entrepreneurship in Montana and to give back. It brings the real experience into the classroom.”
Marty Grant, a junior studying business information systems, is the co-founder of Jimo, a mobile app that connects tourists with local guides.
“I lived in Japan for a while and I got the benefit of being kind of a local and being surrounded by locals and being able to experience just, the things that only the locals know about,” he explained. “I think a lot of people just don’t get that experience. It’s expensive to get a guide and hard to get in touch with locals.
"And even for the locals there, it’s tough to get in contact with the travelers that are coming to their countries or their areas. So we want to make a way that’s inexpensive that can link these two people so that the guide can make some extra money and the traveler can get an inexpensive local experience.”
Grant said the app will be set up much like the Uber app, and will have a website as well.
“In a lot of countries, it’s mostly mobile instead of desktop,” he said. “The locals will have a profile that shows whether they’re available and if they have a certain interest or expertise, and then the person who is traveling can pull up their app and see who’s in that area and if they find someone they like or they think has good expertise they can connect with them that way.”
Grant’s business pitch didn’t make it out of the first round, but he didn’t let that discourage him.
“The judges had some good questions and some things I really need to think about, especially as we carry this thing forward through the next few years,” he said. “It was really invaluable. Win or lose, I think we got a lot of really great feedback.”
Matt Gangloff, a local consultant who won the competition last year before he graduated, said he has been encouraged by the quality of pitches this year.
“It’s refining the business model and it’s a lot of how your pitch comes across and it’s communicating the value proposition that is going to resonate with your audience and just kind of general encouragement,” he said. “This can be a kind of stressful experience. It’s a long day and it’s in front of hundreds of people. We won this thing last year and the quality of the ideas has gone up exponentially since. I don’t know that we would have even made it out of the first round. I’m really impressed with the caliber of presentations.”