May 3, 2022 BACK
Presenting This Month:
RealKey, Christopher Hussain
Featured in this issue:
Discotech with Ian Chen
This month we have four presenters. Below is a brief summary of the companies presenting on Wednesday. Then you'll find a profile of a company (Discotech) and a member of the Pasadena Angels, Gary Awad.
Startups Presenting Wednesday, May 4th
Presenter: Jason Vego
Bevz is transforming the snack and drink industry with the first-ever SaaS platform for convenience stores. By bringing together the 150k+ stores across the nation with the technology, data, and support they need, we'll create a network that is more powerful than any big-box chain.
Presenter: Anna Gudmundson
Traction & Impact. A mission to solve a ubiquitous problem by tapping into the body's intelligence with innovative technology. - 363% YoY Growth in 2021 - $2.7M in revenues last year - 10M minutes of Sensate sessions - Backed by elite VC/investors such as: TenOneTen, Unlock, Martin Tobias - Years of R&D is completed -> granted patent in the EU, pending in the USA - 90.5% found Sensate equally or more effective than other relaxation solutions.
COMPANY: Genius Juice
Presenter: Alex Bayer
Genius offers 100 % organic, high quality whole coconut smoothies to retail stores such as Whole Foods, Albertson's/Vons/Pavilions, Target, Smart & Final, Natural Grocers, and local chains such as Bristol Farms, Lazy Acres, and Mother's Market. We are currently in over 2,500 doors and are on track to achieve 4x revenue growth Year over Year from 2019 to 2020.
Presenter: Christopher Hussain
Automated mortgage processing SaaS platform to centralize and simplify documentation collection and review to reduce touches with underwriting by getting the right information and data the first time, direct from the source through API integrations and OCR text recognition, while automating review of data through algorithms and text recognition, creating a clean loan submission that reduces time, effort, and frustration for all parties involved.
Company Profile - Discotech and Ian Chen
A lot of startups begin with someone saying: “This shouldn’t be THIS hard!” In 2013, Ian Chen said a version of that, maybe slightly more along the lines of “It should be easier to party!” So, he started his own company: Discotech.
Not surprisingly, he wasn’t the only Southern California twenty-something who thought to make an app that would help rockstars book tables at nightclubs. What’s unique about Ian and Discotech is that nine years and one pandemic later, they are still partying. Lots of competitors couldn’t stay up past 2017. Some of those with a bit more stamina still couldn’t keep rocking when COVID hit. Others were taken down by Delta and or Omicron.
And, that’s why Discotech just had their third best month ever, because after The Great Culling of Nightlife Apps, those who persevered have been rewarded. This is the story of that perseverance.
Originally, Discotech launched in 2014 with a focus on tables at nightclubs because those were big ticket items that paid a good commission. So did everyone else. After adding an Android version in 2015, Ian and Discotech expanded vertically to the lower-priced nightlife options: buying tickets and signing up for free guest lists.
That addition in 2017 significantly increased their addressable market. Guest lists and tickets are lower-commission transactions, but there are a lot more of them. A lot of competitors were like the monkey with his hand in the jar wrapped around the big fat table reservation commission that they just couldn’t let go of.
Discotech realized that increasing their market was critical to their success. In 2017, they realized that there were customers who preferred to use a website, so they built the web app, giving them three platforms for customers to access the service. Then, they expanded horizontally to pool parties, lounges, bars, concert venues and music festivals. All of these changes multiplied their addressable market. At the same time, many competitors fought to the death over the limited high-end table-booking market segment. In the end, that segment would go to the eventual winner, which Discotech had plans to become.
First, however, they would have to survive COVID. There may not be a worse industry to be in than bars and nightclubs when a pandemic like COVID hits. Revenue went to zero for about a year. At first, Ian thought, “How long can this last?” Uh… Yeah, we all thought that.
Discotech has some great investors who were farsighted and confident in the company, so several stepped up and provided some bridge funding. Government programs like the CARES Act and its sequel helped, as did tax credit programs and local grants. The company implemented a number of austerity measures. There were layoffs. And, then there were pay cuts. One investor offered to borrow some Sales and Marketing staff for a while. Ian found a contact who borrowed some other staff for a period of months. The company offshored some support functions to the Philippines. Ian pulled every lever he could find to stay afloat.
Cruelly, things started to get better, and then Delta clobbered the nightlife business again. And, then Delta passed and business came back stronger than ever. Until Omicron clobbered the nightlife business yet again. Ian has given up on trying to predict the future of COVID. Discotech plans to adapt and overcome whatever comes next.
But, right now, business is booming, and Discotech is raising money. Their current round is a SAFE with a $15M valuation. They have about $1.5M raised and commitments of another half million that will wrap up the round. The funds will be used to improve the platform and especially to scale marketing for end-users, since they are the fuel for the two-sided marketplace. For now, Discotech is focused on reaching its potential in the United States, despite how attractive overseas markets appear. Ian recognizes that attention and effort are limited resources, and getting spread too thin is a common pitfall.
If you’ve ever watched an automobile race, you’ve seen a yellow flag come out, and all the cars slow down and bunch up. When the caution ends and the green flag comes out, where you want to be is at the front in the inside lane. That’s how Ian describes Discotech: we’re in the pole position at the restart. With the pandemic hopefully in the rearview mirror, they are raring to go!
Gary Awad on Fueling the Future
Gary Awad had a lot of experience negotiating international petroleum contracts before he and representatives of nine other oil companies prepared to finalize a major deal the consortium had been negotiating with a newly independent country. After five years, they needed a single signoff to cement the deal. Ten representatives lined up at the conference room table. Representing the government was their single counterpart, who reached down into his lap and pulled out a pistol. Putting it on the table between them, he declared that they were going to do this deal with an additional $100 Million signing bonus wired into a special bank account, or they weren't going to do it at all.
After the meeting, the consortium went to the U.S. State Department, where Gary had worked during the Carter Administration. Then they explained to the foreign government that if they wanted to build a relationship with the west, they couldn’t ask for bribes. Western companies are governed by anti-corruption laws. The consortium would only make remittances to the government. Fortunately, the foreign government recognized they needed western companies in the project to offset the leverage a single country’s involvement would have on the young nation. The consortium successfully developed the fields, which today exports significant quantities of petroleum to world markets and provides the majority of revenues for that nation.
That experience was one of many interesting moments in Gary’s first career in the international petroleum business.. Those years took him to some far corners of the earth, but he never lost his connection to home. Gary and his wife Georgette have been married for 43 years. With their daughter Sarah and son Garrett, they lived for three years in a storybook neighborhood outside of London and for four years in Houston, but they’ve always returned to the Pasadena area.
When Gary negotiated with Soviet counterparts during the final years of the Soviet Union, his company often entertained the heads of petroleum ministries in Los Angeles. The Soviets didn’t have the technology to develop deeper water oil production at the time, so Gary gave one Minister a tour of his company’s oil production platforms in the Santa Barbara Channel using the company plane. Afterwards they proceeded to the company president’s house for a private dinner. At the end of the evening, Gary drove their guest to his hotel. Along the way, the visitor wanted to stop and buy some cigarettes, so Gary stopped at a supermarket. The Minister marveled that they didn’t need a party card to enter. He walked every aisle of the supermarket eyeing through tears the food on display.
The petroleum collaboration would end up in the Minister’s report, but the supermarket would never be forgotten. On another occasion, a Soviet scientist told Gary the single most effective tool leading to the breakup of the Soviet Union was the VCR and videos which provided a sharp contrast between the western lifestyle and the experiences of the average citizen.
Gary retired after thirty years with one of the petroleum majors, then became involved with a startup oil and gas venture based in Calgary, helping to grow and list the oil company on public exchanges in Canada and London. It became the best performing junior international oil company on the Toronto stock exchange in 2004. He was lead Director on its Board until they sold the company in 2008, the same year he had a cancer diagnosis. He didn’t know it at the time, but beating cancer opened a door to a whole new set of experiences. He saw his daughter become a successful gallery artist and tenured professor and his son help grow a successful social enterprise shoe company (TOMS), start another company with a professional football player, then become involved with an early stage foodtech company. He got to welcome two grandchildren to the world. And, he got a chance to have a positive impact on people’s lives in whole new ways.
After Gary sold his Canadian petroleum venture, he turned his focus to charities and investing. Gary has used his knowledge and experience to mentor startups and nonprofits through his roles at the LA Cleantech Incubator (LACI), Homeboy Industries, the Beacon Housing Foundation and the Pasadena Angels.
In 1988, Father Greg Boyle founded Homeboy Industries to help rehabilitate former gang members. It's not an exaggeration to say that it has inspired millions of people. Homeboy Industries expanded into a bakery, and then a café, and then a silk screening business. And then it inspired four hundred versions of itself to be established across the globe. Then, it got a new CEO, Tom Vozzo, and it really started to get innovative.
Homeboy acquired Isidore, a LACI portfolio company Gary was mentoring, to enter the electronics recycling business. Gary knew Tom as a former Pasadena Angel from a decade ago. Gary and Tom worked together to form the Homeboy Ventures and Job Fund, which promptly garnered $11M toward a goal of $15 M, while Homeboy has added a further $22M from MacKenzie Scott and Dan Jewett and another $15M from the State of California. Gary chairs the Advisory Board for the Fund, where the goal is to invest in businesses that do social good and provide employment opportunities for the Homeboy family.
Gary’s traveled all over the world and lived in a lot of places, but today you can find him at the intersection of Social Improvement and Innovation and enjoying time with his family and friends on his pickleball court or on the golf course.
April '22: Sashee Chandran, Seatrec and Susan Marki
March '22: Yezin Taha, Spine Align and Jamie Bennett
February: Phoenix Gonzalez, Repurpose and Marcus Filipovich
January: Ksenia Yudina, BeTheBeast and Larry Uhl
November '21: Roy LaManna, TotSquad and John Keatley
October: Dr. Chorom Pak of LynxBio and former president Al Schneider
September: Luk Network, Brandon Cavalier and Nancy Dandridge
July: Electrum, Jose Gomez and Julie Pantiskas
June: Ready, Set, Food, Dr. Mirianas Chachisvilis and Joseph Pitruzzelli
May: MagicLinks, Christopher Hussain and Janice Orlando
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We hope you enjoyed this edition of the Pasadena Angels Monthly Newsletter. Any suggestions for future pieces, questions or comments? Please email me at firstname.lastname@example.org
Dave de Csepel
Chairman, Pasadena Angels