Best Detroit Tech Startups Of 2011
At times it seems there's enough startup buzz in this town to power 12 of Dan Gilbert's M@dison buildings, but how does one sift through the business plans of IT wannabes to find the one that could be the next Apple?
We've compiled a list of the Top 11 Detroit tech startups of 2011 to get you acquainted with the energetic, rapidly expanding tech scene in the formerly-Motor City.
The so-called Webward push is looking to take Detroit 2.0 (or was it 3.0?) and make it a rival for Silicon Valley. The city's tech incubators, business accelerators and venture capital firms deserve a story of their own, and there's little doubt that Detroit Venture Partners, Bizdom U and Tech Town are playing a key role in getting Detroit tech startups started up. But others are doing it on their own, often looking to help city residents and nonprofit organizations help themselves.
Land use and real estate are a big theme, as are mobile apps. And don't forget social networking or crowd-sourcing. Whatever the tech pulse, Detroit's startups have at least one finger on it. And we have a feeling they won't be using cardboard boxes as desks for very much longer. So here they are: The Top 11 Detroit Tech Startups Of 2011.
Hajj Fleming thinks that his new software platform holds the key to putting his company, <a href=" http://www.gokit.me/blog/" target="_hplink">gokit.me</a>, in the driver's seat in Detroit's new tech startup race. "Detroit was the Silicon Valley of its day with the automotive industry and Motown" Detroit-based digital entrepreneur Hajj Fleming told <em>Black Enterprise</em> last month, adding that he planned to be part of the city's comeback. The company's website describes gokit as "an online identity platform that allows you to create visually compelling personal homepages that tell your story and share your social network connections in a central location." Hajj told the <em>Network Journal</em> that gokit's goal is to <a href="http://www.tnj.com/technology/tech-start-gokit-centralizes-social-platforms " target="_hplink">centralize a user's online presence</a> in a way that's more formal than Facebook and more friendly than LinkedIn. "We wanted to create something that wasn't a resume format but was a professional, business-like destination," he said. "We're going to give people the ability to share what we call 'multiple personas' for the different dimensions of who they are in the business realm." Hajj formed gokit in March after attending South by Southwest Interactive, a tech gathering in Austin, Texas. He had just finished a photo shoot at the conference and needed to assemble a press package when the idea struck him to create a system that brings multiple information sources together in a unified platform. The business accelerator <a href="http://www.newmeaccelerator.com/about/ " target="_hplink">NewMe</a>, which <a href="http://www.huffingtonpost.com/2011/08/01/hank-williams-clickradio-kloudco_n_915091.html" target="_hplink">assists</a> "under-repesented minorities in the technology industry," chose gokit as one of 10 businesses to participate in its mentorship and training program this past summer. <em>-- David Sands</em>
<a href="http://coremerchant.com/" target="_hplink">CORE Merchant</a> technically got off the ground in August of 2010, but the startup is doing well in 2011, very well. It plans to handle <a href="http://www.modeldmedia.com/startupnews/coremerchantdetroit120611.aspx" target="_hplink">$250 million in transactions next year and hopes to hire 25-30 new employees</a>, according to ModelD. The company works to eliminate hidden fees and unnecessary middlemen from credit card processing -- whether the point of exchange is online, through a mobile device or face-to-face. Its goal is to save clients cash and give them a better idea where the money they are spending is going. According to <a href="http://www.bizdom.com/businesses/page2" target="_hplink">their mission statement</a>, CORE Merchant is "on a mission to change the payment processing industry by simplifying the supply chain" and "has developed a new business model that removes extra layers of pricing manipulation, reduces margins, and improves transparency." <a href="http://www.bizdom.com/" target="_hplink">Bizdom U</a> graduates Alex Linebrink, Munaf Assaf and Brandon Darling created the business, which is based in Tech Town. In the past 15 months, CORE Merchant has <a href="http://www.modeldmedia.com/devnews/coremerchantdetroit083110.aspx" target="_hplink">scored clients</a> including Quicken Loans and the Cleveland Cavaliers, along with several smaller firms, ModelD reports. <em>-- David Sands</em>
Real estate-savvy doesn't even begin to describe <a href="http://www.picketreport.com/" target="_hplink">Picket Report</a>, a web tool for those looking for every possible piece of data on a given neighborhood anywhere in the country. Picket Report aggregates data on schools, crime, credit ratings and demographics to create "lifestyle" profiles of neighborhoods. The aim is to help users figure out the best place to live to fit their needs. The site's founders, Bryan Kunka and Brian Bandemer, met at Bizdom U, which they credit for a strong startup experience. "Not only did they provide us with mentorship, leadership and helping us create our idea, they gave us the funding as well, and got us into coming down to Detroit and helping the city grow," Kunka said. Kunka explained the idea "started out as 'Carfax report for the house' -- everything related to the house and the area all in one pdf report." But they found that was going to be too much data for one pdf, so they tried to trim it down to key pieces of user-friendly information. The target user is anyone who's moving and wants to know how he or she will fit in with the neighbors. "We aggregate over 100 million pieces of data -- the details are so in-depth," Kunka explained. "It's stuff like people watch HGTV because they like doing their own home improvements, they like idea of driving a Ford car but most likely drive a used Ford. We really dig deep on that." Is there any risk that Picket Report's data-driven neighborhood profiles could lead to homogenized communities? Kunka says their clients -- many of whom are real estate agents -- can use Picket Report's data to make objective, rather than subjective recommendations to their own clients. The site has partnered with Quicken Loans and won't stop there. In 2012, Picket Report will see a site redesign and potentially a doubled workforce, as well as iPhone and Android mobile apps. <em>-- Simone Landon</em>
While the <a href="http://myubi.tv/" target="_hplink">Ubi Video</a> website launched just two months ago, James Norman, a University of Michigan graduate who founded the video curation startup, has been working hard for much longer to get all the pieces in place. Ubi capitalizes on the growing trend of internet TV watching and gives users a space to watch and save online video from across the web, all in one place. Whether it's an episode of your favorite show streaming on Hulu, or a viral video from YouTube that you can't stop watching again and again, you can find or add anything to create your own "personal channel guide." "It was too hard to find your shows when you wanted to," Norman told <a href="http://www.modeldmedia.com/startupnews/ubivideodetroit092711.aspx" target="_hplink">Model D</a>. "I wanted one place where I could watch all my shows online." For two years, Norman's team of 10 has been working from its Riverfront office to collect 40,000 videos for the Ubi site. The website is in beta and currently only available in Michigan, with 300 users as of September. Norman plans to launch nationally next year, at which point he hopes to have more than a million users. Currently users must request a log-in before being allowed access to the site. But once in, you can expect to start losing time -- and sleep -- as you find yourself watching show after show from Ubi's growing collection. Ubi Video is part of the <a href="http://www.motowninitiative.com/" target="_hplink">Motown Initiative</a>, a group of entrepreneurs that works with startups. "Detroit has a lot of small scale chatter going on," Norman said in an interview with Southeast Michigan Startup. But he thinks the <a href="http://semichiganstartup.com/founders/jamesnormanubivideo.aspx" target="_hplink">city's startups should actively work together</a> to call attention to themselves and their work. "For Michigan to become the hot bed for tech innovation, we need more startups reaching national scale." <em>-- Kate Abbey-Lambertz</em>
If you consider life to be but a game, <a href="http://playgumshoe.com/" target="_hplink">Gumshoe</a> is just the mobile phone app for you. Gumshoe is a mobile phone-based game that lets users solve mysteries and share adventures based on their Facebook posts and <a href="http://ipod.about.com/od/ipodtouchapps/a/foursquare-app-definition.htm" target="_hplink">Foursquare</a> location updates. The game is the brainchild of Tenth Story Labs, based in the Madison building, home to several other new Detroit-based startups. Here's how Dwayne Raupp, one of the company's cofounders, describes the new application: <blockquote>Someone may have stolen the coveted beer tab from your local Pub and its on you to find out who and get it back. Each clue you find and solve further advances your story and continues to customize the game to your interests and social behaviors. You can compete against your friends and others in your community to gain badges, social cred and sometimes even a real life reward!</blockquote> Brandon Chestnutt, who hosts Detroit's annual <a href="http://detroit.startupweekend.org/" target="_hplink">Startup Weekend</a> convention, described the game as "Clue" meets "Where in the World is Carmen Sandiego" meets social media. Gumshoe beat more than 20 startups from around the world at the Inaugural <a href="http://techcocktail.com/funded-by-night-competition-detroit-startup-scene-2011-03#.TuofPCPLyRk" target="_hplink">Funded by Night</a> event in April, winning a $100,000 investment from two local venture capital firms, Detroit Venture Partners and Ludlow Ventures. <em>-- David Sands</em>
Are You A Human
Does trying to solve the visual riddles of online captchas (those squiggly type authentication questions) make you feel like an unintelligent robot? This startup understands, and they're here to make sure that not only are you a human, but that you feel like one. <a href="http://areyouahuman.com/" target="_hplink">Are You A Human</a> posits itself as a "captcha alternative," one that will keep websites secure and keep user information private. It was founded in June by three friends from U-M's Ross School of Business, Reid Tatoris, Ben Blackmer, and Tyler Paxton. The idea, and the catchy name, were Paxton's. "Tyler was working at a job and one of the cofounders was buying tickets to a Hannah Montana concert in '07. He couldn't get tickets and there was article saying they sold out in six minutes because they were bought out by ticket bots," Blackmer explained. "They researched why and found failures in the systems, and Tyler did some noodling and came up with this idea of you could 'game-ify' that space." Computers are getting smarter and "it's easier for bots to complete most captchas than humans," Blackmer explained. "Since captchas are optical character recognition, since it's only that one thing, computers get better and better at reading it," Tatoris added. "Captchas have to get more difficult." So, Are You A Human asks users to play a game instead of squint at garbled text. The software then judges based on how the game is played whether a user is exhibiting "human-like behavior." The technology is free for websites. Tatoris explained the company is planning to make money by creating branded games -- users might have to drag a pepperoni onto a Dominos pizza, for example. The founders won second place Ross's business plan competition in April, which helped them garner enough interest to secure funding from Detroit Venture Partners. They now have offices in the Madison building and employ seven full-time staffers and two design contractors. Tatoris and Blackmer say choosing to locate their company in Detroit was a good fit. "We're really excited to be here," Tatoris said. "It's fun to see people downtown building companies and it's a really exciting time. Detroit is a really interesting place to be right now, and we'll see what happens, but there's a lot of energy and it's a great place to start a company." <em>-- Simone Landon</em>
Giant Eel, a startup founded by University of Michigan graduates Edmund Zagorin and Jacob Mendel, is bringing video into the third dimension from a production studio in Harbor Town. The 3D video production company, which has four partners and a rotating cast of collaborators, was hatched in the U-M tech incubator, <a href="http://cfe.umich.edu/techarb/" target="_hplink">TechArb</a>, where its founders received entrepreneurial training and learned how to attract early investment, apply for grant money and find out whether there was a need for their services. To make 3D films, the company uses stereography, a process that uses two cameras to create footage from two perspectives. When shown together, the images give the illusion of depth. Giant Eel's producers do all their own stereography, and the company continually adapting as its young -- but growing -- industry changes. Right now, Giant Eeel's is focused on developing media for glasses-free 3D devices. Zagorin encouraged movie-makers and companies to consider 3D for their projects. A common misconception, he said, is that shooting a movie in 3D comes at the expense of 2D, but in fact, shooting in 3D gives you both. Mendel and Zagorin's first collaboration was Mendel's senior thesis, but since starting Giant Eel they've worked on all sorts of projects: <a href="www.alignmentproject.com" target="_hplink">Alignment Project</a>, a science fiction film in London, post-production work for a Japanese television studio, music videos for local bands, and building a footage collection, which they contribute to the first 3D stock footage library. Adventurers take note of that last one: If you've got any exciting projects planned, Giant Eel (pending availability) wants to film them, free of charge. Possibilities on their website include tattooing, taxidermy, demolition and space travel -- all captured in 3D. "We're sort of full spectrum," Zagorin said. "We try to get our hands in anything 3D and try to work with a bunch of projects to see how 3D interacts with their workflow." However, Giant Eel is most interested in using 3D in a subtle way. "We're using 3D to tell stories rather than for pure spectacle and overblown special effects," Zagorin said. "We focus more on narrative and nuance." While Michigan's film incentives spurred the founders' decision to locate Giant Eel in Detroit, <a href="http://www.huffingtonpost.com/2011/11/17/michigan-film-incentive-jobs_n_1098247.html" target="_hplink">the recent cap</a> hasn't disheartened Zagorin and Mendel. With a <a href="http://www.honigman.com/files/Uploads/Documents/MI_Film_Incentive_Package_-_Full_MKT_-_PG_Style.pdf" target="_hplink">minimum limit of $50,000</a> in expenditures required to benefit, their lower-budget productions wouldn't have qualified anyway. Instead, it is the community and labor pool that Zagorin sees as an opportunity. "It has this momentum, and a lot of people were excited. That excitement hasn't gone away," he said. Detroit was also the perfect place for Giant Eel to put down roots because of its great filming locations, lower cost of living and the growing start-up culture in the city. "As filmmakers Detroit is a dream come true," Zagorin said. "There's beautiful architecture and not just the ruins you always hear about. Albert Kahn, Art Deco, it's almost Gotham-esque ... there's just so much variety in the city." "There's a romantic vision for a lot of young people living and working in Detroit, of rebuilding the city, and that's something we see ourselves as part of," Zagorin said. "We love the start-up culture in Detroit." Find more information about Giant Eel on <a href="http://www.gianteelproductions.com/" target="_hplink">their website</a>, and if you want to see what you're missing in the third dimension, see the Giant Eel <a href="http://vimeo.com/27304085" target="_hplink">Vimeo channel</a>. <em>-- Kate Abbey-Lambertz</em>
Non-profits looking to step up their game with social media and other online resources should check out <a href="http://www.ardentcause.com" target="_hplink">ardentCause</a>, an information technology marketing and consulting firm based in Ferndale. The company offers a variety of services to help not-for-profit groups, fund developers and grant-making foundations get their jobs done quickly and easily. The start-up recently attracted the attention and funding from the First Step Fund, a business incubator partnership made up of the Invest Detroit Foundation, TechTown and Ann Arbor Spark. "We are excited to support ardentCause," First Step Fund spokesman Jonathan Palay <a href="http://detroit.cbslocal.com/2011/10/31/innovative-social-enterprise-expands-with-invest-detroit%E2%80%99s-first-step-fund/" target="_hplink">told CBS News</a>. "The company nicely fits our funding criteria with strong, experienced founders, a talented team and a realistic, achievable business plan." The company came together when four partners with IT backgrounds met while crafting a regional charity to assist young women entering the technology field. They found that many existing IT tools were difficult to use, so they decided to design a streamlined service that catered directly to charities and nonprofits. ardentCause offers software that helps visually track a program's efficiency and growth. It allows users to visually chart results and then share those results with potential donors and fundraisers. ardentCause also provides a consulting service and a "virtual CIO" that gives nonprofits access to an experienced chief information officer who can answer questions and give direction on projects. The firm recently added Norm Keane, former CEO for the Jewish Family Service of Metropolitan Detroit, to its advisory board. Keane said he joined the ardentCause team because he was impressed with what the service did for his own nonprofit. "We needed a technology vision and they helped us with that. Based on my 46 years of nonprofit experience, I can safely say that technology should be a major component of any nonprofit's 'roadmap,'" Keane <a href="http://detroit.cbslocal.com/2011/10/31/innovative-social-enterprise-expands-with-invest-detroit%E2%80%99s-first-step-fund/" target="_hplink">told CBS News</a>. "Knowing how to incorporate technology into your plans is essential." <em>-- David Sands</em>
"We Build Apps." That the tagline for <a href="http://detroitlabs.com/" target="_hplink">Detroit Labs</a>, and a simpler explanation of a tech startup is hard to find. The company builds mobile and business apps for small and large clients alike. Detroit Labs has rocketed to success since getting off the ground in February. CEO Paul Glomski said they started paying their first employee in May and now have 16 people on board, as well as several large million-dollar-plus contracts. "It's been an exciting ride," Glomski said. Some of their big-name clients include Stryker Medical, Caesars Entertainment, Quicken Loans, and <a href="http://www.fathead.com/" target="_hplink">Fat Head</a>. Of that last client, Glomski said, "We're building an augmented reality app for them that helps you see what a fat head will look like on your wall before you make a purchase." He said part Detroit Labs' success comes from the initiative of team members, who devote 20 percent of their time to brainstorming and working on independent projects. "We tend to attract people with a bit of mad scientist in them," Glomski said. "We provide company-funded time to work on those ideas and help them with the business aspects of those ideas." Glomski gives also gives credit to the Detroit tech scene. "In literally in less than a year we've created a business that's employing people and has valuation in the millions; I don't think that people would expect that out of Detroit," he said. "When you have such a sort of ground-floor opportunity it's really exciting and it attracts talent." And it helps that Dan Gilbert's around and willing to buy into local tech startups' services. "There are clients here in Detroit that would much rather work with a Detroit tech company than anybody outside of the city and we're finding there's quite a market opportunity based on that," Glomski said. <em>-- Simone Landon</em>
Detroit Big F Deal
<a href="http://www.detroitbigfdeal.com/" target="_hplink">Detroit Big F Deal</a>, started by Tunde Wey, is one of the 17 pilot companies in the <a href="http://www.detroitcreativecorridorcenter.com/our-work/business-accelerato/creative-ventures-in-residence/" target="_hplink">Detroit Creative Corridor Center's Creative Ventures in Residence</a>, a business accelerator program started this year with some support from Wayne State's <a href="http://techtownwsu.org/" target="_hplink">Tech Town</a>. That's a long way of saying that this big deal has some powerful backing to help the company achieve its goals. Detroit Big F Deal is an innovative crowd funding platform (think Kickstarter, but better) designed with Detroit in mind that finances locally-oriented projects. Wey works with a small number of projects at a time to make sure they get his full attention. People -- whether Detroiters or admirers across the country -- can learn about projects on his website and support them with money or by volunteering time or supplies. Contributors get incentives in the form of coupons for local businesses, which is all part of Detroit Big F Deal's community-building plan. "The biggest thing is, it has to be a community based project," Wey <a href="http://www.loftsofmerchantsrow.com/blog/detroit/detroit-giving-its-a-big-f-deal/" target="_hplink">told The Lofts of Merchant Row</a>. "It has to somehow have to have a mission beyond making money or producing a service. There's lots of people doing wonderful things in the city, and usually most of them are community-based -- so we have a lot of projects to pick from, I think." On the site right now, users can donate to projects varying from a community radio station to an independent movie theater, from an urban farm to a home renovation project. It's also a great way to learn about groups to get involved with. And unlike Kickstarter, Detroit Big F Deal has open-ended funding drives and does not require groups to reach set goals to receive funding. It seems like Wey has already accomplished plenty since the site launched in July, but he's got bigger plans. "Our projects aggregate a community of passionate Detroit advocates, converting their energy and enthusiasm into tangible outcomes that can be measured in terms of economic, creative and civic impact on the city, i.e. dollars spent, visitors attracted, individuals volunteered, etc.," he told <a href="http://iamyoungdetroit.com/index.php/2011/07/28-year-old-tunde-wey-is-a-big-f-deal/" target="_hplink">I Am Young Detroit</a>. "We want this passion and the outcomes described to serve as a strong influence in promoting the city to the wider public." <em>-- Kate Abbey-Lambertz</em>
Why Don't We Own This?
While the two-year-old <a href="http://makeloveland.com/" target="_hplink">LOVELAND Technologies</a> is nearing maturity in startup years, founder Jerry Paffendorf and his partners, Mary Carter and Larry Sheradon, keep starting fresh with radically new projects that are changing the way Detroiters can understand, access and engage with their city. In September, Paffendorf launched <a href="http://whydontweownthis.com">Why Don't We Own This?</a>, a site that tracked the availability of properties in the 2011 Wayne County Foreclosure Auction. Whether or not you're looking to buy property, it's easy to lose an hour on the site clicking through the interactive map, available properties, tracked bids and lists of owners. Probably its most important -- yet simple -- feature is the comments, where people shared information about the listed properties. Paffendorf said several people found out about their own homes' foreclosure status through Why Don't We Own This?, and through a side-project, <a href="http://landblank.tumblr.com/" target="_hplink">The Landblank</a>, Paffendorf was able to raise money to buy six properties and give them to community groups. LOVELAND Technologies is taking Why Don't We Own This? to a new level starting in mid-December, when the site will start using the same user-friendly mapping tools to show 47,000 vacant government-owned properties that are for sale inside the city limits. The site will let users send official applications to buy straight to the city, either privately or publicly. The public applications will let others critique and compare ideas, and, Paffendorf hopes, put some positive pressure on the city to review the best ones. "Even private property is public information," Paffendorf said. "And public property should be doubly public." But and his team had a challenging time getting information about the properties from the city, and their list is still incomplete. The initial plan was to put images of all 47,000 properties online, but for now, the sheer number of properties makes that impossible. "The city of Detroit's vacant land crashed the Internet," Paffendorf said. "It's just kind of shocking. I don't know why [the information] isn't readily shared." Paffendorf's efforts to put Detroit online one bit at a time in a variety of forms is something he thinks will be beneficial to residents, and he has proposed working directly with the city. Currently, Why Don't We Own This? is entirely not commercial. "Which is kind of funny," Paffendorf said, "because in some ways it might be the most valuable thing that we do." "It is clearly too important; someone has to do it," he added. Paffendorf said that while many in Detroit are working on similar problems, there needs to be more on the tech side. "We don't have enough people using information technology as the lever to sort some of these problems out," he said. "I would love to put out a challenge to more software and start-up people: If you have any interest in urban design or creating cities of the future or making technology human, come to Detroit." LOVELAND is exploring ways that Why Don't We Own This? could be adapted to other cities and ideas, and Paffendorf has been approached about making similar tools for businesses. "We all have kind of an abiding faith that if we do things that are important and meaningful to people who will find the way to survive and grow." To find out more about the myriad LOVELAND projects, <a href="http://makeloveland.com/" target="_hplink">check out their website</a>. And check often, because the team -- whose members must never sleep -- shows no sign of slowing down. <em>-- Kate Abbey-Lambertz</em>