The Most Interesting Y Combinator Winter 2012 Startups

The signs that Y Combinator‘s winter 2012 demo day yesterday was going to be packed began with the traffic jam on the Highway 101 offramp in Mountain View. Simply turning left to cross the Shoreline Avenue overpass to the Computer History Museum in Mountain View took me about 25 minutes. By the time I arrived (late) at the museum, the parking lots were full, and the nearest on-street spot I could find was a couple of blocks down the street. Inside the museum, staff had to cart out extra chairs to accommodate the standing-room-only crowd of angel investors and venture partners. It was a good thing I had brought my own power strip, because there were enough MacBook Airs in the room to heat a small city.

By now it’s a cliché for Silicon Valley tech reporters to write that “this Y Combinator Demo Day was the biggest and craziest ever,” but it was true once again yesterday. The famed startup accelerator program has more than doubled in size over the last couple of years, both in terms of the number of entrepreneurs admitted and the number of investors who want to jostle with each other for the right to back the companies it hatches. YC bowed to reality this time by holding its semiannual beauty pageant outside of its cramped Mountain View facility, but founder Paul Graham and his crew might want to seek an even larger venue next time around. (I’m thinking Hangar One at nearby NASA Ames Research Center.)

In past reports on YC Demo Day I’ve given a rundown of all presenting companies—but there were just too many this time, and you can check out blogs such as TechCrunch if you want summaries of all the public presentations. (The pitches came from 39 on-the-record companies and another 26 companies with plans to de-stealth at a future date.) Instead, I want to talk about the companies that seemed most interesting and impressive, whether in terms of the cleverness and originality of their business concepts, the scale of the market opportunity open to them, or the importance of the problems they’re taking on.

Graham wrote recently that he’d like to see more startups pursuing frighteningly ambitious ideas—challenges such as building a better search engine, replacing e-mail, or fixing universities. It seemed to me yesterday that Y Combinator has begun to put more of its money where Graham’s mouth is, by selecting teams working on some pretty big problems. Previous batches have seemed too full of hackers building tools that only help other hackers—and there were still a few companies like that in this batch. But the group also included many companies whose technologies promise to make a lot of average peoples’ lives easier or more fun. Below are my picks for the YC W12 “most interesting” list. (Note: I would have included several of the off-the-record companies if they’d been willing to talk publicly.)

Patrick Riley, Yiming Liu, founders

Google and Facebook are at war. That’s too bad for consumers, because it means Facebook will never open up its profiles to Google searches, and Google will never show Facebook profiles in its results. Ark says it’s building a search engine “completely reimagined for people.” The company indexes profiles across social networks like Facebook, Google+, LinkedIn, Foursquare, MySpace, Orkut, Meetup, and even China’s RenRen and Russia’s Kontakte, and lets users search the index using filters such as name, location, gender, language, hometown, employer, college, relationship status, and interests. In the company’s example at Demo Day, a woman from Kathmandu, Nepal, used Ark to find the profiles of people in her adopted city of Boston who speak Nepali.

Navneet Dalal, Mehul Nariayawala, founders

Flutter is building gesture-recognition software that turns every webcam into the equivalent of a Kinect motion sensor. Microsoft has sold 18 million of these devices to go with its Xbox 360 game consoles—but according to Flutter, there are 5 billion devices with embedded video cameras, every one of which could be equipped for gesture control instead of old-fashioned mousing and clicking. In its alpha version, Flutter is Mac-only, and can only be used to control iTunes and Spotify. But software like this could obviously help boost all computer users into the long-promised era of gesture control, without forcing anyone to buy special 3D scanners like the Kinect.

Jason Freedman, James R. Bracy, Jonathan Bracy, David Woodworth, Ben Ehmke, founders

42Floors isn’t going to change the world, but it may help a lot of companies. The founders say they want to do for commercial real estate what Trulia did for homes and rental properties—that is, make it easier to find listings online. “It’s as if an entire industry was never introduced to the Internet—all the websites look like they came from 1995, which they did,” the founders say of the commercial real estate business. Their own site gathers office-space listings from brokerages, landlords, Craigslist, and other sources, and displays them using maps and high-quality photos. The company, which keeps a 20 percent commission on deals completed through the site, is also creating a marketplace for office furniture and the other products and services companies need when they’re moving. It’s all such a no-brainer idea that the company seems sure to succeed—or to get bought by Trulia.

Adam Forsythe, Anthony Martin, founders

In a world with hundreds of millions of mobile devices with glass touchscreens, what are we going to need? Lots of Windex and chamois cloth, yes, but also someone to repair our cracked screens after we accidentally drop or sit on them. iCracked says that with “iTechs” in 130 locations around the country who can travel to customer’s home or office and repair a cracked screen in under 30 minutes, it’s already the nation’s largest repair service for iPhones, iPods, and iPads and is set to earn $180,000 in the second quarter of this year. The company also offers a mail-in repair service and do-it-yourself kits. Given that 20 percent of all iDevices will suffer a broken screen or water damage at some point in their lifetimes, the company is entering a market that’s unlikely to dry up. And it’s developing a very clever side business: buying back broken devices, exporting them as junk to countries with high tariffs on U.S. electronics, then repairing and selling them.

Matt Bell, David Gausebeck, Michael Beebe, founders

These days, architects remodeling buildings often start by building a high-resolution 3D computer model—but making these models requires expensive laser-scanning equipment. MatterPort is developing a system that anyone can use to create a 3D model of an interior space just by walking around with an inexpensive, handheld scanner (it looks a lot like a Kinect, actually—watch their video here.) The company says its system is “20 times faster and 18 times cheaper than any other tool” for building 3D models of interiors, and aims to sell it first to users in the construction, entertainment, and real estate industries. Look for this company to either disrupt or be acquired by giants like Autodesk.

Nikki Durkin, Peter Delahunty, Dan Walker, founders

Not to be confused with 99Designs (I guess you can’t trademark a number), 99Dresses pledges to given women access to an “infinite closet” by making it easier for them to buy and sell their used clothing. Users upload photos of their unwanted dresses to the 99Designs site, where other users can buy them using a virtual currency called Buttons. They can then spend their buttons for other clothes. 20-year-old founder Nikki Durkin, who piloted the business in her native Australia, says she’s sure the service will appeal to “every college girl on a tight budget, every high school girl who wants to dress cool, every working woman in need of an ever-changing wardrobe.”

Spenser Skates, Curtis Liu, founders

Siri, the voice-activated assistant in Apple’s iPhone 4S, only works when you hold down the home button or put the phone up to your ear. But what if Siri were listening to you all the time, ready to respond to whatever you said? That’s the direction Sonalight is exploring. The startup makes an Android app called Text By Voice that can be left running in the background all the time. Whenever you say “text by voice,” the program wakes up and uses speech recognition algorithms to let you dictate a text message. It also lets you reply by voice to incoming text messages. Sonalight pitches Text By Voice as a way to avoid texting manually while driving, but to me it looks like the vanguard in a new era of what might be called ambient software, ready to spring into action upon any verbal cue.

Wade Roush is the producer and host of the podcast Soonish and a contributing editor at Xconomy. Follow @soonishpodcast

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