Professor Stan Mandel says PTP Next Competition Gives Students Real-World Research Experience
Seed money helps startup companies
Reposted from Winston-Salem Journal | By Richard Craver
A Triad entrepreneurial group that makes wireless patient-monitoring systems that prevent bedsores is ready to shift into a higher financial and production gear, partly thanks to a Piedmont Triad Partnership program that provides advice and seed money to help startup companies.
The hope is that those companies’ successes will lead to more jobs for the Triad area, officials said.
Sensors on Seniors LLC of Oak Ridge has had a monitoring system in trial use with six residents at a South Boston, Va., nursing home since October.
The device has a sensor to alert medical staff to move bedridden people on a set time period, thus avoiding unnecessary bedsores and ulcers.
“The sensor is the size of a Listerine strip package, which is worn on the chest beneath the gown,” said Tanya Brewbaker, chief financial officer of Sensors. “The actual software where the alerts are displayed is on a computer at the nurses’ station.”
The company, with four technology veterans from RF Micro Devices Inc., has in the past three years established a business and financial model, landed production partnerships and a potential supply pipeline with at least one nursing home chain. It has expectations of serving at least 100 nursing homes by year’s end.
What Sensors lacks is the money to expand its research and analysis to determine which markets to target first and a competitive price for the product. Its employees have been financing the company out of pocket by serving as contract workers.
“We have a great product at a great value,” said Jon Jorgenson, founder of Sensors. “The challenge is helping others find out about it and us.”
Helping to resolve their funding need is PTP Next LLC, a subsidiary of Piedmont Triad Partnership, an economic-development group. PTP Next receives money from the partnership and investors to help take startups from seed funding to drawing the attention of venture capitalists.
Sensors was named last week as one of two winners out of 70 applicants in PTP Next’s first grant competition. The competition was coordinated with NC IDEA, a statewide nonprofit that conducts a similar, larger grant cycle.
The other winner was Innovative Applied Solutions LLC of Jamestown, which is attempting to commercialize new technologies that help developers and engineers comply with increasingly expensive environmental regulations.
Sensors received $25,000, while Innovative received $20,000.
“The key factors for the winners were scalable growth, innovative products, services, processes and technologies, and the impact of the grant on the company’s success,” said Libby Brown, a research manager for the partnership.
Up to an additional $55,000 in grant money will be available to winners selected in the spring grant cycle. Although the spring grant cycle is limited to the remaining initial 68 applicants, PTP Next is holding a workshop in Greensboro on Wednesday that is open to startups aiming for the fall 2012 cycle.
Coleman Team, 2012 chairman of PTP Next, said the competition is similar to economic-incentive packages in that companies are held accountable for their progress, including receiving part of the grant based on performance.
“Each company will have to follow a very specific plan, including how they are going to spend the money,” Team said. “Applicants have to commit to being based in the Triad or plan to be based in the Triad.”
Team said PTP Next officials limited the spring grant cycle to the initial applicants “because we wanted to give them a chance to tweak their plans, attend workshops and work with mentors. The other three finalists from the first round were so close.”
Other Winston-Salem officials helping with PTP Next include: Michael Batalia, director of the Office of Technology Asset Management at Wake Forest University’s medical school; Andy Dreyfuss, fund executive of Piedmont Angel Network; and Robert Egleston, president and chief executive of DataMax Corp.
Most of the Sensors employees said they got involved in the startup in part because of seeing family members suffer from chronic health issues, some of which were avoidable.
Brewbaker said the team recognized an opportunity for the devices as more baby boomers reach retirement age. Medicaid typically doesn’t reimburse medical care related to bedsores because they are considered avoidable with proper monitoring.
Bedsores, if left untreated, can lead to severe ulcers and tens of thousands of dollars of hospital bills that are the responsibility of the nursing home, Brewbaker said.
Donald Liegey, administrator of South Boston Manor LLC, said he’s sold on the devices. All of the trial residents have been able to avoid new bedsores.
“The sensor provides a verifiable level of reassurance to family members,” Liegey said. “The software also helps us determine if we are having problems with monitoring patients during a shift.”
Westcott, of Innovative, said she believes investors liked her water-quality skimmer products because its design “addresses many of the complaints expressed by contractors and design professionals of what they view as design flaws in the offering of our only broadly commercially available competitor.”
“PTP Next, like us, believes we can claim a significant share of that market in a short period of time,” she said.
After securing a patent, Westcott wants to open a manufacturing plant in Rockingham County, Caswell County or one of the Urban Progress Zones in the Triad’s metropolitan areas.
“Creating new jobs in the parts of our Triad community that need them the most is core to our business philosophy,” Westcott said.
Stan Mandel, director of the Center for Entrepreneurship at Wake Forest, got involved with PTP Next in part because it gives students in his entrepreneurial essentials class a real-world research experience.
“We welcomed the opportunity to help analyze the finalists in the PTP Next competition,” Mandel said. “The due-diligence reports were at a very high level and showed research, as well as entrepreneurial insights, into the ventures.
“The businesses benefited by having another independent set of eyes on their venture to help see where it is heading and potential areas that need more attention. Several times we discovered fatal flaws or near fatal flaws in their venture outline.”
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