Written on the whiteboard on the first day of my entrepreneurship class at Tufts was a sobering statistic: 80 percent of startups die in their first four years. There exist a variety of factors that can kill a business. Luckily, Boston is full of programs and organizations designed to help entrepreneurs navigate through the startup process. The National Collegiate Inventors and Innovators Alliance’s Sustainable Vision VentureLab, led by James Barlow, is a five-day intensive incubator program for companies doing business in emerging markets (it ran August 26-30). I initially thought that it would be an abbreviated version of a conventional business class curriculum, somewhat similar to what I had experienced in the five-day boot camp organized by MassChallenge: what are the best ways to structure a company, to manufacture, distribute, and market product X in market Y, and how to go about getting VC funding?

On the contrary, it is a back-to-basics introspective program that emphasizes the human element of a business, such as being able to communicate your value proposition in an effective and clear manner. This may sound elementary. The reality is that this is the foundation for any business. James compared it to humming a song in your head. When vocalized you can clearly hear the tune and the words, even though the person across from you may be shooting you a puzzled look. This is a problem many entrepreneurs unknowingly struggle with. Having become so familiar with the intricacies of their businesses, they have lost the ability to break it down into its simplest and most coherent forms. When hearing these entrepreneurs pitch, the listener finds himself unable to understand the core of their idea, akin to listening to a hummed song.

Oftentimes, the founders themselves are confused and are unknowingly in disagreement about what the value proposition of their businesses is. Even if they are aware of the value proposition, they are unable to translate it in a way that speaks to the wants and needs of their market. That is why the VentureLab program focuses so much on deconstructing the human element aspect of your business. This is often a tricky process because it requires you to examine your business in a manner in which you are unaccustomed to and uncomfortable doing. At Roof For Two, we looked at all the factors that could sink our company and discovered the need to connect with different influencers in our product market. It became an exercise in stitching together our business and value proposition in a manner that resonated with each one of these individual actors. For example, our company provides a motorcycle weather accessory for riders in India to shield themselves from the monsoon rains. It saves them time in their commute and increases the efficiency of businesses whose employees lose time when seeking shelter from the downpour. When we started looking beyond our end user and examined other people potentially impacted by our product, we began asking ourselves very different questions from the ones we had originally posed. We had initially asked: What do Indian motorcyclists look for in a product? How will our product affect their lifestyle?

However, during VentureLab we looked beyond the commuter towards businesses, institutions, and society. We asked ourselves very different questions: What businesses stay open during the heavy monsoon season? Would small businesses have incentives to subsidize our product for their commute sensitive employees? How do we best communicate our value proposition to both the commuters and the businesses that depend on them?

Besides the introspective portion, part of the learning process in programs such as VentureLab comes from the interaction between participants who can help one another, despite operating … Next Page »

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Vestaron has raised about $445,000 from the sale of equity, according to SEC documents.

Overall, the startup, based in Kalamazoo, MI, is seeking $8 million, the filing says. So far, Vestaron has raised $9 million from investors including Open Prairie Ventures, the Southwest Michigan Life Science Venture Fund, and the Michigan Strategic Fund. These investors have committed $3 million in Series B funding to Vestaron.

The company is developing platform technology, first created at the University of Connecticut Medical School, that effectively eliminates insects without harming the environment.

Vestaron says its technology is less toxic than pesticides because it is based on peptides that spiders use to kill insects. The company also claims its peptides are more effective at controlling insects. While other insecticide makers only target one metabolic pathway (the way insects process food and create energy), Vestaron says its technology can disrupt three unique metabolic pathways. As a result, insects are less likely to develop resistance to its products than traditional insecticides, the company says.

“It’s interesting science,” says Pat Morand, managing director of the SWMF Life Science Fund, which first funded the company in 2007. “It’s clean technology that can meet the requirements of the Environmental Protection Agency.”

Vestaron says it will focus on four different types of customers-agriculture, animal health, public health, and lawn and gardens—a combined market value of $15.4 billion. The company plans to launch its first EPA-registered product in 2013 and hopes to break even by 2015.

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Hundreds of people packed the Bell Harbor Conference Center on Seattle’s waterfront yesterday for the University of Washington’s annual Business Plan Competition. Now in its 14th year, the competition is a great showcase of energy and ideas from student entrepreneurs and some of their more experienced collaborators.

Last night, the group of 37 teams was whittled down to the “sweet 16″ semifinal round. You can learn more about the particulars of the competition at the Foster Business School website, and check out the list of the 16 semifinalists.

I wasn’t there as a judge, but decided to compile a few capsules of the proto-companies that caught my eye—even though some of them didn’t make the next round, or even have websites yet, we could be hearing more from these folks in the future.

Yoi! Gaming
Massively multiplayer video games are not exactly mainstream, but the people who are into them are really passionate—there are mini-celebrity players who make a living in competitive gaming, John Madden-esque online commentators, and big tournaments with serious prizes.

But Yoi! Gaming CEO C.J. Wong says there’s a gap between those big tournaments, which can be difficult to qualify for, and the smaller, local competitions that rely on having everyone in the same place. “We feel like we’re in 1918 before the NFL started—there’s a bunch of small leagues out there,” Wong says.

The idea behind Yoi! is to set up online matchmaking that can sort people into quick groups for competing against each other, with buy-ins and prizes—something that should sound familiar to anyone who’s seen online poker sites explode in the past decade.

Wong says, however, that online video gaming competitions have avoided the heat that regulators have applied to poker companies because the games are seen as more skill-based, and not related to gambling. Yoi! already has a license from Blizzard Entertainment, the makers of hugely popular game StarCraft—which, I am not making this up, is so popular in South Korea that tournaments are shown live on TV.

ZeroBrane
These guys are developing a small, cheap robot that uses a smartphone as its brain. The little machine, which looks like an iPhone riding a miniature pair of Segway wheels, is intended mostly for entertainment purposes on the consumer side right now—tooling around the house or “chasing your cat,” … Next Page »

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We saw financings, CEO and board hires, and clinical results from New England area biotechs this week.

—Blueprint Medicines, a startup focused on developing personalized cancer treatments, said it nabbed a $40 million Series A financing led by Third Rock Ventures. Mark Levin and Alexis Borisy of Third Rock serve on board of directors at Blueprint, which is using molecular and cancer genome data and a proprietary chemical compound library to develop drugs more tailored to patients’ conditions.

—Weston, MA-based Biogen Idec (NASDAQ: BIIB) said that its oral multiple sclerosis drug candidate, dimethyl fumarate (BG-12), met its main goal in a pivotal study of 1,200 patients, by reducing MS flare-ups over two years compared with a placebo. The treatment also met its secondary goals, like slowing the rate of disability from the neurodegenerative disorder.

—Aveo Pharmaceuticals (NASDAQ: AVEO), a Cambridge, MA-based drug developer working on an advanced treatment for kidney cancer, said that it added Henri Termeer to its board of directors. Termeer will be leaving his role as chairman and CEO of Genzyme (NASDAQ: GENZ) now that Sanofi-Aventis has completed its $20.1 billion buyout of the biotech.

—Enlight Biosciences, a Boston-based firm founded to aid Big Pharma with R&D challenges, added Roche veteran Michelle Browner as CEO. Enlight founding CEO David Steinberg, a partner at Boston-based venture firm PureTech Ventures, will remain on the company’s board.

—Brighton, MA-based surface engineering and nanotechnology provider Nano Terra said it acquired Surface Logix, also of Brighton. Both firms were founded by Harvard University chemist George Whitesides. The acquisition will enable Surface Logix, a drug developer, to apply the Nano Terra technology to healthcare products.

—MIT spinout Taris Biomedical added $18.3 million in a financing led by new investor Third Rock. The money will go to advancing the company’s lead drug, a potential treatment for a number of bladder ailments, into mid-stage clinical trials.

—Monsanto (NYSE: MON) said it was partnering with Cambridge-based Atlas Venture to find life sciences investments complementing Monsanto’s agriculture business. The were no financial terms disclosed for the multi-year collaboration, in which Atlas will help Monsanto scout investments in the areas of genomics, informatics, and biology, and Atlas will gain insight and technology to make its own future investments.

—Merrimack Pharmaceuticals, a Cambridge-based developer of cancer treatments, announced it had raised $77 million in Series G funding from new and existing investors, which include Crocker Ventures, Jennison Associates, TPG-Axon Capital, and WT Investment Advisors Fund.

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This week we’ve seen financings and acquisitions news spanning the life sciences, IT, and cleantech sectors in New England.

—OpenMile, a Boston- and Chicago-based developer of Web and mobile technology for optimizing shipping, said it raised $6 million in a Series B deal led by Globespan Capital Partners, with participation from existing investor Charles River Ventures.

—Waltham, MA-based Bluespec, a maker of software for designing electronics components, grabbed $1 million in equity-based funding from four investors, an SEC filing showed. The company’s previous investors include Atlas Venture and North Bridge Venture Partners.

—DynamicOps, a Burlington, MA-based maker of software for cloud infrastructures and IT virtualization, snapped up an $11.3 million equity-based financing. The company was spun out of Credit Suisse in 2008.

—Marlborough, MA-based CardioFocus brought in $30.6 million to put toward its medical devices, which include a product for treating an irregular heart rhythm known as atrial fibrillation. The money comes from new investors First Alliance & Capital Invest, Fletcher Spaght Ventures, and Manatuck Hill Partners, as well as all of the startup’s previous investors.

—Boston non-profit Diagnostics For All nabbed a $3 million grant from the Bill & Melinda Gates Foundation and the UK’s Department for International Development to fund the creation of three new tests aimed at improving safety and productivity in agriculture. Diagnostics For All first spun out of Harvard to focus on diagnostic products in the human health space, and is led by veteran biotech executive Una Ryan.

—CHiL Semiconductor of Tewksbury, MA, said it is being acquired by Los Angeles-based power management firm International Rectifier (NYSE: IRF) in a $75 million cash deal expected to … Next Page »

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You don’t often hear the words “technology” and “insurance” in the same sentence. But at a press event today, a high-tech weather insurance startup called WeatherBill announced that it has received a big infusion of Series B cash from some serious Silicon Valley investors, including Google Ventures and Khosla Ventures, for its automated system of reimbursing farmers for adverse weather events affecting crops.

Founded five years ago by ex-Googlers David Friedberg and Siraj Khaliq, WeatherBill sells farmers insurance policies that are priced according to the weather risks in each customer’s region and that pay out automatically (with no need for a claim) if there’s an unusual amount of rainfall, drought, heat, cold, or snow. The San Francisco company’s Series B round, totaling $42 million, comes from existing investors Allen & Company, Atomico, Code Advisors, First Round Capital, Index Ventures, and NEA, as well new investors Google and Khosla.

The 30-employee startup has raised $60 million in all. Friedberg says WeatherBill’s focus is on using its probabilistic models to protect farmers against unexpected weather risk year-round, through a product launched last year called Total Weather Insurance. That helps smooth income, which allows corn and soybean farmers to invest more in sustainable agricultural practices, Friedberg says. “By getting a guarantee on what one might make per acre of farming, a farmer can feel more confident in their investments,” he says.

Bad weather accounts for 90 percent of crop losses around the world, according to the USDA. WeatherBill’s investors are betting that as climate change spawns more extreme weather events like the recent drought in Russia and the flooding in Australia, losses will increase, and that more farmers around the world will be attracted to the idea of hassle-free payouts tied to weather measurements. By supplementing government-subsidized crop insurance, WeatherBill can “fundamentally change the risk profile of the global agriculture industry,” Khosla Ventures founder Vinod Khosla said in a statement. “WeatherBill is one of those rare companies that has the leadership and vision to apply new technology to an ancient and daunting problem.”

WeatherBill charges $15 to $75 per acre for its insurance policies, according to Friedberg. In order to accurately price its policies and calculate payouts, WeatherBill has built a cloud-based system that continuously gathers weather data from multiple, independent sources and feeds them into large-scale weather simulations. The company says it plans to use part of the new funds to hire more software engineers, mathematicians, and climatological agronomists to refine this platform. It also plans to expand U.S. and international sales operations.

In a statement, Google Ventures managing partner Bill Maris said that investing in WeatherBill fits with the fund’s mission “to identify and fund big ideas.” Just last week Google Ventures revealed that it had co-led a $20 million investment in Transphorm, which is working on ways to vastly improve the efficiency of power converters used in data centers and other facilities. Maris said it wasn’t surprising to see a pair of ex-Googlers take a “big data” approach to overhauling an old industry like agricultural insurance.

“It’s something completely different” from the Transphorm investment, “but equally transformational,” Maris said at today’s press event. “This is actually not [an insurance company], it’s a technology company that happens to be doing insurance. We couldn’t think of a better DNA fit with Google Ventures.” Maris said Google will likely be able to help WeatherBill with large-scale computing design and engineering as well as product design and marketing.

WeatherBill has built several side businesses on its weather risk assessment platform, including a rain insurance product for travelers called RainCheck and insurance programs for organizers of outdoor events such as golf tournaments. The company can even insure ski resorts against lost revenue from low snowfall—though that certainly isn’t a problem in the western U.S. this year.

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Boston-based nonprofit firm Diagnostics For All announced today that it has nabbed a $3 million grant from the Bill & Melinda Gates Foundation and the UK’s Department for International Development, to put toward developing three diagnostic tests for the agriculture space. The firm will use its diagnostics platform to develop a test for detecting milk spoilage, one for targeting the growth of mold in corn, and a third to determine whether cows are pregnant or ready for breeding to help farmers better manage their herds. Diagnostics For All, a Harvard spinout led by veteran biotech executive Una Ryan, previously focused entirely on tests in the human health field, like a paper-based diagnostic product for measuring liver toxicity in HIV and AIDS patients that the firm plans to begin testing later this year.

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For some people, innovation is not enough. Gururaj “Desh” Deshpande is one of those people. Let’s just say the Boston-area tech entrepreneur and billionaire philanthropist has earned the right to make such a claim.

“For innovation to have impact, it needs relevance,” he says. “Innovation plus relevance equals impact.”

Deshpande is talking about global impact, but his latest project is in his own backyard. Last month, his foundation committed $5 million over the next five years to support a new innovation center housed at the University of Massachusetts Lowell. The Merrimack Valley Sandbox, as it’s called, will work together with local colleges and nonprofits to boost entrepreneurship among students and professionals, and to develop local leadership through mentoring and seed funding programs.

The new initiative has similarities to the Deshpande Center at MIT and a social entrepreneurship center Deshpande set up in northern Karnataka, India—with some big differences. But to understand what Deshpande is really trying to accomplish with the Merrimack project, you need to know more about his story.

Gururaj Deshpande grew up in India and studied electrical engineering at the Indian Institute of Technology in Madras (Chennai). He went on to do his PhD in data communications at Queen’s University in Ontario, Canada. Starting in the late 1980s, he founded a series of successful technology companies—Coral Networks, Cascade Communications (which sold to Ascend Communications for $3.7 billion in 1997), Sycamore Networks (NASDAQ: SCMR), and Tejas Networks. He currently serves as chairman of Sycamore, Tejas, and A123Systems, among other top-level duties.

The success of Cascade and Sycamore made Deshpande a wealthy man, and he and his wife Jaishree set up the Deshpande Foundation in 1995. Its unifying theme has been to foster innovation ecosystems and social entrepreneurship. Its first major initiative was setting up the Deshpande Center for Technological Innovation at MIT in 2002. That organization has been active in providing grants to MIT labs, connecting faculty with the business community, and more generally tying ivory- tower research to market realities.

“In society, thinkers all come together, and they come up with new ideas,” Deshpande says. “But as they keep coming up with new ideas, they have to play the game of impressing each other”—whether that means other professors or government funding agencies. “In the process they lose the ability to have impact,” he says, because of a lack of relevance to real-world problems (and products). “The center at MIT is about bringing that relevance.”

After a few years, Deshpande looked at setting up something similar in his native land. “But somehow doing nanotechnology in India didn’t sound that exciting,” he says. Instead, he thought, … Next Page »

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None of this would have happened 10 years ago. Where to begin?

Last month, I walked into a room of about a dozen robotics experts and technology startup investors. It was one of the sessions at the MassTLC Innovation “unConference” in Boston. The discussion centered around how to build a successful robotics company. But it was some of the newer context around this question that turned the session into a watershed moment I won’t soon forget.

Two main takeaways: First, robotics companies around Boston have come a very long way since 2000, when I was a postdoc in a robotics group at the MIT Artificial Intelligence Lab. That sort of academic research is still going strong, but the bigger story of the past decade has been the business success of robotic vacuum cleaners, bomb-disposal units, and surveillance drones, and how that has helped pave the way for a new generation of companies.

My second takeaway is that the business community thinks there is a new threat to Boston’s competitive position in robotics—and its name is Google. I’m not usually one to fan the flames of Boston vs. Silicon Valley arguments, but in this case the discussion hits close to home, so I wanted to see if there’s much truth to it.

The Boston area, of course, is home to numerous robotics companies—iRobot (NASDAQ: IRBT), Boston Dynamics, Harvest Automation, Heartland Robotics, Kiva Systems, iWalk, and CyPhy Works, just to name a few. Many of those companies were represented in the unConference session, along with investors from CommonAngels, Founder Collective, and General Catalyst. Historically the region has had lots of expertise, both in universities and industry, in key technologies underlying robotics such as sensors, actuators, control algorithms, artificial intelligence, computer vision, and data storage.

Yet 10 years ago, most early-stage investors (angels and VCs) wouldn’t think of touching a robotics startup. The development costs and business risks were too high, and the technology infrastructure—onboard processing power, wireless communication, programmable chips, sensors, algorithms—wasn’t quite ready for prime time. Now things have changed, certainly in investors’ minds, … Next Page »

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[Corrected 10/28/10, 9:45 am. See below.] San Diego-based Cibus Global held an open house last night at the company’s new headquarters, which gave me an opportunity to get an update from CEO Keith Walker on the agricultural biotech’s growth spurt since last year.

The startup, which officially spun out of Pennsylvania-based ValiGen in late 2001, is marking the commercial introduction of its first enhanced crop—an herbicide-resistant strain of canola—in coming weeks. Cibus also plans to expand its workforce, from 52 to 60 employees by the start of 2011, and has moved its headquarters into a refurbished leased facility once occupied by La Jolla Pharmaceuticals. The impressive, platinum LEED-certified space might even mark the beginning of a tech resurgence among the vacancies that pockmark Sorrento Valley’s Nancy Ridge Drive.

Keith Walker

“It’s been a fabulous 15 to 18 months for us,” Walker says. “We’ve done almost $50 million worth of transactions on behalf of the company with corporate partners.”

[Corrected to explain the technique used by Cibus does not insert an entire gene] Cibus, for everyone who neglected to take Latin, is roughly translated as “food for man.” The company uses its proprietary “Rapid Trait Development System” technology to achieve a desired trait, such as resistance to a widely used weed killer, in certain crops it has targeted. Cibus has managed to sidestep harsh protests over genetically modified organisms, or GMOs, because its … Next Page »

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“Social shouldn’t be viewed as soft,” says University of Michigan finance professor Gautam Kaul. “Unfortunately, soft and social tend to go together in people’s perceptions.”

But Social Venture Fund, a new investing vehicle out of the University of Michigan that came out of stealth mode just last week, is taking a hard look at social inequality—and is out to prove that investments targeted at ameliorating it can make money. “We want to use rigor in measuring social impact and making investments that are real,” says Kaul, the managing director of the fund.

A handful of students approached him a year and a half ago with the idea for a social venture fund, as a new business model to help solve real-world problems, he says. He made the team formally pitch the idea to him (much in the same fashion entrepreneurs present to investors), to prove the concept went beyond a philanthropic idea, and had the potential to also generate returns.

Social Venture Fund’s team, which is now expanding and could reach a total of 30 students, has been working over the past year to develop the vision for the project and the types of companies it will invest in, Kaul says. The fund adds to the university’s group of student-run funds—the Frankel Commercialization Fund and Wolverine Venture Fund, which has had four successful exits, including an IPO. Unlike the other student-run funds at the university, Social Venture Fund didn’t start with money, Kaul says. “We felt that this was too important to wait on trying to raise money for something.” The 2010 MBA class at the school has already pledged its gift to the Social Venture Fund, which is also working on a big fundraising push.

Broadly, Kaul’s team envisions its investments falling into a handful of sectors: education, food and nutrition, health, finance, the environment, and urban revitalization. He says the team is particularly interested in looking at companies that fuse the latter two concepts, and work on solving problems that are often left to the government.

“We want to create a new type of organization that does not worry only about money making, but worries about policy and impact on society,” he continues. To do that, Social Venture Fund is looking at companies that … Next Page »

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Last week the Northwest Energy Angels—a group of over 45 private investors who have banded together to invest exclusively in cleantech and energy companies located here in the Pacific Northwest—held its annual Summer Showcase at Tesla Motors’ South Lake Union showroom. Founded by Seattle entrepreneur Martin Tobias and state lawmaker Jeff Morris in 2006, the angels provide early-stage capital to cleantech entrepreneurs and connect promising companies with potential investors.

So far, the group has invested more than $3 million in 17 local companies, a sign that it is active and growing—along with the Pacific Northwest cleantech sector. Back in March the Angels hired on local tech veteran Margo Shiroyama as the new executive director, and the group is recruiting new angels, hoping to bring the membership up to 60 by the end of the year.

On Friday afternoon many of the angels joined representatives from local cleantech companies, and green-minded community members at Tesla to mingle, connect, and hear updates from 11 companies that had presented at a prior NW Energy Angels event. Drinks were served in 100 percent compostable plant polymer Greenware. I would be lying if I said a few in the crowd weren’t eyeing Tesla’s bright red Roadster on display in the front of the room. (After the presentations, many signed up for test drives around the neighborhood, though I was not so lucky.) But the combination of compostable cups and fully electric cars sure did set the scene for an event on cleantech business ideas.

One of the more high profile attendees included U.S. Rep Jay Inslee, the Democrat who represents Washington’s first congressional district. Energy Angel Bill Lemon introduced Inslee as our “tireless advocate in the promotion of clean energies.” In his introductory remarks, Inslee urged the companies to develop new clean technologies and move the country and world forward toward renewable energies.

“The future of the U.S. economy is not determined at the Fed, or the White House, or the Congress. It is determined by people like you,” he said. “It is a system that is broken because it is rife with subsidies that support old technologies that have been around for the past hundred years.”

Inslee then outlined his five pillars for the future of clean energy, which he termed his “vision for America.” The steps included creating demand for new technology, increasing energy standards for machinery (including cars, buildings, and gadgets), changing the tax code to provide clean energy incentives for small businesses, increasing federal energy R&D, and leveling the playing field between clean energy businesses and industry old timers like oil and coal.

“These five pillars, I think, have the capability to get us into the international game. And it needs to happen this year—next year is a year too late,” Inslee said. “This is the most exciting thing technologically since we went to the moon,” adding that Seattle and the Pacific Northwest are poised to be cleantech leaders based on our booming regional tech industry. “When there’s a technological transition, Washington shines!” he said.

The remainder of the event was dedicated to a series of short company updates and networking among cleantechies. The presenting companies included a few more established startup success stories, as well as a handful of brand new companies fresh on the scene. Though all of the companies had been represented at prior NW Energy Angel events, many of them have escaped our radar until now. But whether you’ve heard of these startups before or not, if you’re interested in what’s up-and-coming in the Pacific Northwest cleantech sector, take a look at these highlights:

—EMME (Beaverton, OR)

Standing for Energy Management Made Easy, EMME develops energy management devices. These are monitoring gadgets for everything from heating, ventilation, and air conditioning equipment, to wireless power monitors, and power meter breaker boxes—that helps consumers keep track of their home’s carbon footprint, and save money and energy. “It will tell you how much you’re spending on heating, cooling, your refrigerator is spending, your big screen TV,” said Jon Brodeur, the company’s vice president of sales and marketing. “And it will give you recommendations on what to do to save energy costs,” without having to change out any appliances.

—EnerG2 (Seattle, WA)

You’ve probably heard of EnerG2, a nanomaterials startup focused on energy storage. The company, which develops ultra-high performance synthetic carbon material for use in double layer capacitors, has had such success in the last few years that Lemon kicked himself for passing up an opportunity to invest. “Boy do I really, really regret it!” he said. Since that missed opportunity, EnerG2 has brought in $8.5 million in its Series A venture investment—which chief operating and financial officer Chris Wheaton joked happened during in the fall of 2008, “nearly financial Armageddon.” Later on, EnerG2 secured another $21.3 million in federal stimulus money. “It completely blew the doors off for us,” Wheaton added. “There’s nothing like success to create more success.”

—EnergySavvy (Seattle, WA)

This energy-efficiency focused startup works to help homeowners understand the “miles per gallon” of their homes by helping consumers calculate their energy use and find places they can cut back, make changes, and save both energy and money. Only an eight-person operation, according to Scott Case, the vice president of product management, EnergySavvy has had so much interest from prospective customers they have been struggling to grow fast enough to keep up. The company makes its money … Next Page »

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Harvest Automation has a straightforward vision on how to target a market for its robotics technology, which comes from iRobot veterans.

“Basically, it’s go where the labor is,” says CEO and co-founder Charles Grinnell. And it’s starting with agriculture. The Billerica, MA-based startup is developing fleets of robots designed to speed up the labor-intensive task of harvesting the shrubs you eventually purchase at your local garden shop or Home Depot, a slice of agriculture where “work is being done the same way it was 100 years ago,” says Grinnell.

Harvest Automation had no particular product or application in mind when the founding team got together in 2007, originally under the name Q Robotics. But Grinnell, a former executive at DEKA Research & Development, the invention shop led by engineer Dean Kamen, aspired with his co-founders to the same success iRobot achieved with its Roomba automated vacuum cleaner. The new company’s concept is to start with robots that can handle some of the manual labor that’s always been a part of agriculture industry. Then it plans to pursue other manual labor-based industries, like construction, warehousing, or mining. It changed its name in 2008 to reflect the honed market focus.

The company doesn’t necessarily aim for its robots to replace the human workers in shrub harvesting, but to instead add efficiency and reliability to the process, Grinnell says. The goal is to improve productivity and output for the wholesale shrub farms, in order to increase reliable delivery to the retailers purchasing the plants.

Harvest announced it had secured a $4 million Series A round in January, with backing from the Massachusetts Technology Development Corporation, the state venture capital fund. Harvest is putting the money, which also comes from the MidPoint Food & Ag Fund and Life Sciences Partners, toward expanding its 10-person operation by another five or so employees over the next year, Grinnell says. The funding is also going to testing its units in the field (literally), with a goal of getting the product on the market in 2011, Grinnell says.

Greg profiled the company back when it was still named Q Robotics, but it reappeared on our radar this year with the ribbon cutting of its new 6,000-square-foot facility in Billerica last month. (Prior to that the company was working out of a founder’s home in Groton, MA).

Its units weigh about 50 pounds, and are a few feet in diameter and less than knee height. They’re designed to … Next Page »

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Over the last decade, Mt. Pleasant, MI-based Dendritic Nanotechnologies (DNT) has helped make Michigan into a world center of research on the versatile, tendriled molecules known as dendrimers. But while the molecules have a range of important applications, from killing microbes to reducing the unwanted side effects of drugs and pesticides, the company has ceded most R&D on the life-sciences side of dendrimers to its Australian parent company, Starpharma. DNT is now focused on dendrimers’ potential in more prosaic areas such as agriculture and cosmetics.

“Where DNT primarily plays around in is what we like to call the more industrial settings,” says Joe Heinzelmann, DNT’s product manager. Applications such as coatings and water purification have the advantage of requiring higher volume than the pharmaceutical industry, he says. Recently, for example, DNT signed a research and collaboration agreement with a U.S. agricultural company to enhance the performance of pesticides.

While Heinzelmann couldn’t disclose the company’s name due to confidentiality restrictions, he said the general principle in agriculture is similar to drug-delivery applications, where dendrimers are able to extend the persistence of an active molecule, potentially reducing the amount that needs to be used. The result in pharma could be fewer unintended side-effects; in pesticides, less chance of causing unintended damage to crops.

To back up, a little dendrimer history. It was here in Michigan about 30 years ago that Dow chemist Donald Tomalia first synthesized the molecules in his Midland lab. Dendrimers’ tendrils, or branches, make it possible to custom-engineer one molecule to perform as many tasks as the laws of chemistry and physics allow. Each appendage can have a separate task-one to sense disease-causing agent and another destroy it, for example.

Tomalia founded DNT in 2001 in a joint venture with Starpharma, based in Melbourne, Australia. Starpharma immediately began to investigate dendrimer technology as a potential anti-HIV microbicide. The product it … Next Page »

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Since June we’ve been tracking monthly figures in bigger venture deals for our two other coverage areas, Seattle and Boston, thanks to data provided to us by our New York-based partner CB Insights, a private company intelligence platform. The company also supplies us monthly with a list of smaller deals under $1 million—what we dub as “under the radar”—in Southern California, the Northwest, and New England, which we like to examine for trends in startup investing.

This was the first month that enough San Diego-area companies made the list to merit a story, which could signal that pint-sized deals are picking up for the region’s startups. There were four San Diego deals, ranging from $201,132 to $689,500. Three were equity-based offerings, and a fourth was debt-related. While these four deals were all relatively small, they definitely signal bigger things to come, as three of the four transactions reflected pieces of larger planned offerings.

The startups that nabbed the funding cover the energy, medical devices, pharmaceutical, and agriculture spaces. That’s right, agriculture. Yes, it’s not typically an industry that we’d cover, but I kept the $201,132 in equity, options, and warrants for San Diego-based Cibus Global on the list because of the way the company has been innovating in the area of crop trait development.

Rather than using traditional genetic engineering technologies of introducing foreign traits to crops, Cibus works within plants’ own genomes to introduce genetic traits through the natural process of gene repair. I’m interested to see where they go, particular because their February deal was just a piece of a planned $2.6 million offering, according to the SEC filing.

The biggest deal on the list was $689,500 of a planned $1 million equity offering for Carlsbad, CA-based Catadon Systems. They’re engineering towers that raise wind turbines higher into the air without the need for cranes or concrete, according to the company’s website. The higher a turbine can be placed off the ground, the more wind energy it can capture, making wind investments pay off faster, the website explains.

The sole debt deal went to San Diego-based Aethlon Medical, in a $600,000 transaction that included options and warrants. Aethlon is developing a diagnostic and therapeutic device for infectious diseases. Their Hemopurifier is a cartridge that removes viral pathogens from the blood and can be used with portable pumps or dialysis machines.

If you ask me, these under-the-radar lists can be nicknamed the stealth lists, due to the fact that they almost always include at least one company that’s too stealthy to have a website. La Jolla’s Ampla Pharmaceuticals took on that role for the February list. The only information I could gather on them was from the website of their investor, Integra Ventures of Seattle. Integra’s website describes Ampla as a “stealth mode biotechnology company,” and says that Advent International and Crabtree Ventures also back the company. Ampla pulled in $295,271 of a planned $1.2 million equity-based offering.

I’m interested to see when these companies will complete their offerings, or roar out of stealth mode. In the meantime, check out the consolidated list below of February under-the-radar deals.

*includes some options and warrants

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Bill Gates has posted his 2010 annual letter for the Bill & Melinda Gates Foundation. The letter focuses on innovation and the foundation’s efforts in education, food, and health—tackling ambitious projects in online learning, agriculture, vaccines, malaria, and HIV, to name a few. Gates also has invested in Vinod Khosla’s most recent clean energy fund, which is just one highlight from his extensive interview with CNET. Gates is also an investor in the San Diego biofuel firm Sapphire Energy, and TerraPower, a nuclear energy spinout from Bellevue, WA-based Intellectual Ventures.

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“The easy answer is, ‘Of course it will,’” said panel moderator Jesse Berst, the head of Redmond, WA-based research and consulting firm GlobalSmartEnergy. He was referring to the title of last night’s event in downtown Seattle organized by the MIT Enterprise Forum: “Will Green Return the Green?”

It’s a reasonable question, especially here in Washington state, where things have been fairly quiet on the cleantech and energy front as of late. Despite the presence of such companies as EnerG2, Verdiem, Optimum Energy, Powerit, Bio Architecture Lab, Areva T&D, Avista, and Imperium Renewables, much has been made of the region’s lack of competitiveness with other parts of the country like Silicon Valley and New England—not to mention global competitors like China. (I’m using a broad definition of “green” tech here to include both alternative energy and sustainability.)

To discuss business and policy leaders’ concerns around financing opportunities, regulations, resources, and hot areas in the green sector, the MIT Enterprise Forum (together with a team of volunteers led by Seattle law firm Graham & Dunn) convened a distinguished panel:

—Berst (the moderator), a global authority on smart grid technologies and economics, and an Xconomist.

—Patricia Irving, CEO and founder of Richland, WA-based InnovaTek, which develops technologies for sustainable energy and environmental safety.

—Rogers Weed, director of the Department of Commerce, Washington state (and a former Microsoft vice president).

—Roger Woodworth, vice president for sustainable energy solutions at Avista, the Spokane, WA-based energy and utilities company.

—Bradley Zenger, managing director at Pivotal Investments, an early-stage cleantech venture investing firm in Portland, OR.

(By the way, all of the panelists are involved with the Cleantech Open, which is gearing up for its 2010 business plan competition.)

Berst kicked things off by saying that dozens of smart grid companies around the world have been raising $50-100 million or more, and many will be going public in the next 12 to 18 months. In terms of Washington state, he said, “We’ve got some real challenges here around creating a real cleantech cluster. The one thing you can’t fake is proximity. We have a lot of islands of innovation scattered 150 miles apart.” He also talked about the entrepreneurial culture of the region: “We don’t have a lot of people with the urgent desire to crush” competitors in Silicon Valley, Boston, New York, and so forth, he said.

Irving, whose company makes fuel cells and other technologies for partners like Boeing, summed up the mindset of consumers in the Northwest. “We love to be green, but we’re not willing to take the risk that’s necessary to shift our paradigms,” she said. “Part of the challenge is we haven’t been willing to stand up. Sacrifices need to be made.”

Weed, who has been on the job for 10 months since being appointed by Gov. Christine Gregoire, said cleantech is one of Washington’s top three opportunities for growth. But the state faces two key challenges, he said. One is the budget situation. “The state is struggling to make … Next Page »

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Three New England firms rounded out the first week of the New Year with new financing rounds.

—Konarka Technologies of Lowell, MA, which is famous for its flexible “Power Plastic” photovoltaic material, raised $23.8 million in Series G funding through an offering combining equity and warrants. All of the money came from a single source, according to a regulatory filing published yesterday, but Konarka hasn’t yet identified the investor. The company’s existing investors include 3i, Chevron, Draper Fisher Jurvetson, Good Energies, Mackenize Investments, the Massachusetts Green Energy Fund, the Massachusetts Technology Collaborative, New Enterprise Associates, Partech International, and Vanguard Ventures.

—Dynadec of Providence, RI, has raised $2.1 million toward an intended $2.4 million round of financing, according to a regulatory filing yesterday. As I explained in a profile last summer, Dynadec, formally known as Dynamic Decisions Technology, is commercializing software developed by Brown University computer scientist Pascal Van Hentenryck that can help companies solve complex optimization problems, such as the most efficient way for a utility to deploy power-line repair personnel after an ice storm. The four investors contributing to the round weren’t named in the filing, but Dynadec’s board includes representatives of Liberty Capital Partners, Velocity Equity Partners, and the Slater Technology Fund.

—In yet another regulatory disclosure filed yesterday, Groton, MA-based Harvest Automation said it has collected $3 million out of an intended $5.75 million funding round. Harvest told Mass High Tech that the investment came from Amsterdam-based Life Sciences Partners and Indiana-based Midpoint Food & AG Fund, as well as Dina Routhier, a principal at the Massachusetts Technology Development Corporation. The startup, which was founded by iRobot alumni and was originally known as Q Robotics, is building agile mobile robots for large-scale agricultural operations. As Greg explained in a July 2008 profile, the robots are designed to adjust the spacing between potted plants as the plants grow.

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Joule Biotechnologies has been busy since we last spoke to the company’s leadership around the time it first started talking publicly in July. The Cambridge, MA-based company, which develops fuels and chemicals in a process that mimics photosynthesis, has been advancing toward commercialization. I got the update from Bill Sims, the firm’s CEO.

For starters, Joule has selected a site for its pilot ethanol production operation where there’s a lot of sun in the American southwest, Sims said. But he declined to specify the location of the pilot site because at least as of December 14 the company had not garnered a local government board’s approval for the operation. Barring unforeseen opposition to the facility, the company plans to announce the location in January. The pilot facility is important because it will help the firm gather more data to back up some of its lofty claims: That its process is capable of making ethanol at $50 per barrel and its annual yields could reach 25,000 gallons acre. The process has previously been demonstrated in small-scale lab experiments.

The pilot facility is expected to test how different photosynthetic organisms perform in the desert climate of the southwest as well as the impacts of different sources of water and carbon dioxide, Sims said. The photosynthetic organisms are used in the firm’s devices called SolarConverters, which will also contain CO2, brackish water, and nutrients. (Joule still won’t tell me what these genetically engineered photosynthetic organisms are exactly.) The converters are designed to capture sunlight, which is a key ingredient for converting the mixture into ethanol. The company’s technology—which it calls “Helioculture”—is noteworthy because it doesn’t require the use of drinking water, food crops such as corn or soybeans, or fermentation, like other methods for producing ethanol.

Joule still plans to link its industrial-scale production plants to facilities that produce lots of waste CO2 such as cement plants, but the firm’s pilot facility will not be connected to a major CO2 emitter because it doesn’t need to be in order to produce ethanol at the scale planned, according to Sims.

What does Joule mean by the “nutrients” and/or the “micro nutrients” it uses in its systems? (The company declined to reveal what these nutrients are back in July, and at least one reader pointed out that these nutrients could be expensive and drive up the firm’s costs of production.) Yet last week the firm told me that those nutrients are phosphorus, nitrogen, and various trace metals—all of which the firm says are quite cheap and abundant. Indeed, phosphorous and nitrogen are ingredients in most fertilizers and play important roles in plant growth, so it makes sense for them to land in Joule’s process that mimics photosynthesis.

However, the firm hasn’t been clear about how it’s going to finance all this work. Joule is only saying that it has backing from a top-tier venture firm in … Next Page »

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San Diego’s little Cibus Global is preparing to one day take on Monsanto, the Fortune 500 agri-industry colossus and leading producer of genetically engineered seed. The bioscience company last month formed a joint partnership with an agricultural products company based in Tel Aviv to spur development of new strains of crops. High on Cibus’ to-do list is the development of crops resistant to weed killers sold by its new Israeli partner, Makhteshim-Agan. This is the model pioneered by Monsanto, which developed a line of “Roundup Ready” crops that are genetically altered to resist its herbicide, Roundup.

Cibus, a private venture-backed company with just 34 employees, seems more than a bit outmatched by its would-be rival. Monsanto is a multibillion-dollar company whose Roundup Ready strains account for much of the corn, cotton and soy grown in the U.S. But as Bruce noted in his report, Cibus believes that its technology for producing new crop strains is less likely to raise the ire of activists who oppose the dissemination of genetically modified organisms, or GMOs. Cibus believes its technology—a sort of controlled evolution—will offer a marketing advantage in Europe, where concerns about GMOs have limited the acceptance of modified crops.

Cibus says its technology, dubbed Rapid Trait Development System, or RTDS, uses the natural DNA repair system in plant cells to trigger a genetic change linked to the desired trait. Cibus CEO Keith Walker tells me the company’s technology changes just one letter in a plant’s genetic code. These little mistakes randomly occur all the time in nature, Walker says; yet Cibus says its technology can control the process.

“The traits we introduce in a plant could … Next Page »

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