April 6, 2021 BACK
Presenting: Eco-efficiency and 5G
And Success Stories You Should Know
Welcome to the inaugural issue of the Pasadena Angels newsletter. We’re planning a monthly newsletter with updates on a variety of subjects. We’ll open each newsletter with a short preview of the companies that will present at the monthly meeting. Then we’ll include company updates and a couple profiles of founders and members of the Pasadena Angels. In future issues, we may include some “Angel Advice” and updates about what Pasadena Angels are doing in the community. Please enjoy this inaugural issue.
April Startups Presenting Tomorrow
Irrigreen makes Smart Sprinkler System that save ~50% water used in landscape irrigation - Over half of the water used for landscape irrigation is wasted due to inefficient mechanical sprinklers. The Irrigreen system is a patented combination of software, hardware and services with over 300 installations.
This application and tools developer is pioneering the future of 'social audio'; leveraging extreme low latency and rapid global adoption of 5G enabling the development of 5G consumer apps. Experienced Team from Sony, BBC, Disneyland, Sony Pictures with multiple successful exits. This team has garnered traction and in technical testing of their first 5G App ('World Karaoke') with Deutsche Telekom, KDDI, Orange, Telefonica. Initial product release date Q3 2021.
Company Profile - ParentSquare
Started by Anupama Vaid and her husband Sohit Wadhwa, ParentSquare puts all school-family communication into a single platform, vastly simplifying life for parents and school districts. If this sounds overdue, you're not kidding. They started it in 2011. Today they're in 42% of school districts in California.
But Anu says that they hit every stumbling block along the way. Anytime you work with children, data privacy is a major concern. And ParentSquare was starting a whole new field - no one had ever offered educational communication unification software - no one even knew that they needed it. And, school districts are not known for being technological frontrunners. They have an annual budgeting cycle and make decisions by committee, so you can imagine the challenges. Despite all that, ParentSquare had made steady progress developing the product and gaining traction with schools, about doubling every year. Then the pandemic happened.
Before 2020, they spent a lot of energy explaining the value of centralizing and simplifying communications. COVID turned that on its head. Schools closed and then became remote, and communication became both a massive challenge and intense priority for educators. Suddenly schools were seeking out ParentSquare. Business increased 168%, in part thanks to an acquisition, and usage was up 8x over the pre-COVID days (even more when Zoom went down last August).
That crushing demand was a double-edged sword. More customers mean more revenue but also more strain on every aspect of the business. But, ParentSquare was solid as a rock. Anu and Sohit were prepared. They had focused on being scalable, and that enabled them to ride the wave. Right now, ParentSquare is in 44 states and in 42% of districts in California with district-wide implementation.
And, that success has led to funding success. Last fall ParentSquare went to the market to raise $5M and came away oversubscribed, with $7M in new funding. All of it has come from angel investors like Pasadena Angels, and those angels have continued to support ParentSquare on their decade-long journey.
Last year ParentSquare acquired a competitor, Signal Kit, which added product capability and key staff. And this year, Anu and Sohit used that funding to build out the dream team, adding additional key staff and capabilities. Chad Stevens, the new Chief Strategy Officer, came over from AWS where he was the leader of K-12 Education. Amanda Dempsey, the new VP of Inside Sales, came from McGraw-Hill Education where she was the Director of Inside Sales there. Nicole Garcia came over from InStride where she was the Director of Customer Success for clients like Starbucks and Uber.
Going forward, ParentSquare has more new features rolling out. And, they're having fun. And, they're helping connect parents and schools, bringing communities closer together and ultimately improving one of the key links in education. In a way, it's another silver lining to the pandemic. Modernizing school communication was probably going to happen one way or another, but thanks to COVID, it's happening at a rapid pace, and ParentSquare is squarely in the middle of it.
Company Profile - BasePaws
You might think that human DNA and virus DNA are hot, but feline DNA is just as scalding. Two and a half years ago, Anna Skaya's brainchild Basepaws caught the attention of Pasadena Angels, both as a pre-seed and a seed-round investment. The startup was the "23&Meow" of the pet industry. Since Basepaws has expanded from feline ancestry genetics to animal medical genetics, investors everywhere are focused on the startup like a kitten on a laser-pointer
Ancestry genetics are interesting and amusing, but medical genetics are functional. They can change health outcomes, save money and increase lifespan. And, they can generate revenue. Basepaws latest product focuses on feline dental health, which is the primary driver of cat owners' vet spending. 50% of pet owners wait until it's too late and then face serious bills. It can cost $800 (and create some risk) putting a cat under and having teeth pulled. Basepaws' new product lets cat owners test their cat's dental health, understand their microbiome and decide what actions to take and whether it's time to go to the vet.
But, data collection may be the bigger story, both because of what it can teach us about feline health and the value that that information creates. Basepaws has inked several agreements with some of the largest animal healthcare companies in the world. They want access to Basepaws' data and customers for research. They're especially interested in being able to track cohorts of animals with specific diseases or markers, and Basepaws can provide that, especially since the company's relationships with customers are so strong and positive. In addition, Basepaws has great phenotype data on pets; whereas people are hesitant to share their own health information, they can barely be contained when it comes to sharing pictures and information about their pets.
Basepaws started with a feline focus but is now poised to expand to new animals. Investors are interested, and the company is expecting to close a new round of funding in May, raising 8-10M in a Series A round. As fundraising proceeds, the company will continue working with partners to collect more data and publishing ground-breaking research on that data.
Basepaws just published a whitepaper on periodontal disease in cats and how it relates to "downstream" organs such as the digestive tract and the kidneys. It is just a glimpse into the potential insights available from Basepaws' new data infrastructure.
Founder Profile - Lora Ivanova
What sustains founders through adversity? Lora Ivanova has some opinions on it, and she has the “receipts,” as they say, having purchased those opinions at the Hard Knocks Store during the last eight years.
In 2020, Lora’s startup MyLAB Box was down to one month of runway. Google’s 2018 “Medic” update obliterated the company’s organic business almost overnight. For an SEO-revenue-based company, losing 80% of organic search traffic was cataclysmic. Of course, she and her co-founder Ursula Hessenflow-Cruz responded with everything you’d expect: SEO re-optimization, restructurings, layoffs, losing good people, getting more flexible and just getting small, agile and tough. And desperate.
And then COVID happened. MyLAB Box was poised to take advantage of the poor state of testing. They rapidly innovated, pivoted and started offering what the market needed. Revenues responded, tripling the prior year and continuing to grow in 2021. Was it determination that sustained her through that difficult year? Was it fear of failure? Or was it unbounded optimism?
Initially, starting MyLAB Box was an uphill battle. Tucked between healthcare and B2C Ecomm, MyLAB Box didn’t fit any known templates. Healthcare investors didn’t like the lack of intellectual property. Consumer investors didn’t like the regulatory menace. And, if this was such a good idea, why weren’t LabCorp and Quest doing it? And why would two founders with no healthcare or testing experience be the ones to crack this nut?
What they failed to see was that being in the gap was the opportunity. And, not being Quest or LabCorp was the advantage. It meant that Lora and Ursula were tuned into the consumer-experience and not tied to their enormous infrastructure and existing conventions. All they had to do was find some investors for whom it was about more than the money – who could see their vision and help them achieve it. Find some Angels who get it and self-fund the rest. Lora had to rethink her growth strategy. She had to build a plan to succeed with a modest seed round, because MLB was never going to be Theranos or deposit a Theranos-sized money-bomb. Was it pride that motivated her to prove that she could do it?
Not many founders, while their business was being squashed by Google’s Medic Update and while the world was being afflicted by a pandemic, would decide the time was right to have a baby. But, Lora did. The pandemic also made work-from-home a necessity, so she could be close to her baby while working. And, she took her newborn everywhere. She found a way to make it work – to juggle the pandemic, the pivot and the precious bundle. Was it stubbornness that wouldn’t allow her to let Google tell her her business couldn’t succeed and wouldn’t allow her to let a pandemic tell her that she couldn’t have a baby?
Lora had a thriving career before she took a gamble on MyLAB Box. But a serious car accident in 2010 committed her to a long recovery confined to a bed. She realized a few things. If she was going to get out of life what she wanted, she’d better get busy doing it. And, if she stayed in corporate business, she’d always be dependent on other people for her title, her career path and her opportunities. That glass ceiling waited back at the office. She set aside some time to work on projects. She committed to herself that she’d follow her passion when the inspiration struck.
As a child, she always admired entrepreneurs, those who struck out on their own, but she never really imagined that would be her. Nonetheless, the seed was planted for the desire to forge her own future. In 2013, she and Ursula had an epiphany. Inspiration sprang from a conversation about dating, sexual health, testing, and how complicated medical care was but shouldn’t be. It was a market with a stigma and a profound need for change. Inspiration struck, but would it be enough to sustain her through the worst ordeals?
The photo of the eclipse above appears on Lora’s LinkedIn profile. It’s part remembrance of her own eclipse experience and part reminder of the sense of awe she experiences in nature. It is a bit of who she was and who she is inspired to be. She loves to climb the hills of Griffith Park and commune a bit with nature. The views from Griffith let her experience the big picture. It’s a fair amount of work to get to the top, which makes it all the more rewarding. The eclipse photo embodies the moment of awe she experienced. It’s a bit ominous – even scary – but it’s also a reminder that even in the darkest moments, there's always a silver lining.
So, what does sustain founders? Lora had that seed – that desire to build something. And, she’s got that determination to overcome fueled by a passion to change the world. And, she’s indomitable.
Member Profile - Ken Hayes
“Scaling up” is a concept that angel investors and entrepreneurs know well. Ken Hayes has taken it to another level. He’s scaled businesses, and now he’s scaling himself in the way he works with startups.
It started after college when Ken got a job that took him to Europe. There he attended business school in France and started an edtech business in Denmark: IMS Learning.
From being an entrepreneur and helping start a single company, he transitioned into investing in startups. Ken liked working with entrepreneurs, and he liked communicating with them. His experiences working in a startup spurred the interest in helping startups grow. And he discovered that he has some experience and skill identifying entrepreneurs who can benefit from more than “just the money” from investors.
Back in Los Angeles after 14 years in Europe, Ken met Bill Zimmerman, a Pasadena business leader and co-owner of the Huntington Hotel. Bill had a broad ranging career, eventually acquiring dozens of companies and becoming an angel investor. Bill introduced Ken to Pasadena Angels and coached him as Ken became an angel investor himself.
Later Ken co-founded Canyon Creek Capital II, a SoCal VC fund that invested in 40 companies in 2015. But, where a venture fund could support dozens of companies, an accelerator could support hundreds of startups earlier in the process. Ken’s takeaway from the many pitch competitions that he attended was that there were very few “winners,” but there were a lot more entrepreneurs that needed coaching. An accelerator could give them the boost they needed to reach their potential.
Ken’s interests evolved towards startups that could have a positive impact on clean energy and the environment – innovations that could “move the needle” for our quality of life. He joined Cleantech Open in 2017 to lead the organization as the national Executive Director. Cleantech Open is a different kind of accelerator – one with a mission to fund and foster entrepreneurs with ideas to transform energy and the environment. Now starting its 16th year, over 100 companies participate annually, which lets Ken scale up even more.
From one startup to investing in multiple startups as an angel investor to dozens of startups as a venture capitalist to hundreds of startups through the accelerator, Ken wants to have an impact. He’s not “one-at-a-timing” here. He’s operating at scale. And, if you want to talk to him about it (and you can ride a bike), look him up on Strava and invite him out for a ride. He’ll take you up on it! Because, cycling is the new golf.
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Dave de Csepel
Chairman, Pasadena Angels