Headed to ATX

2 Houston companies named pitch finalists for SXSW 2019

Two Houston companies will be pitching at SXSW in March hoping to win their categories and take home "Best of Show." Marie Ketring/via sxsw.org

In two months, a couple Houston companies will be packing their bags and headed for Austin, where they will pitch their startups at the 11th annual SXSW Pitch event. SXSW announced the 50 finalists on Wednesday.

A total of six Texas companies — two from Houston and four from Austin — will be presenting to a live audience and panel of judges at the March 9 to 10 competition. There are 10 categories, each with one winner, as well as an overall "Best of Show" winner.

Houston-based Fluidity Technologies will be presenting as its drone controller, FT Aviator, has been named a finalist in the Hyper-Connected Communities category. Fluidity is lead by CEO Scott Parazynski, a former NASA astronaut, pilot, and physician. The FT Aviator has the potential to revolutionize drone technology. The joystick-like controller is based off movement in space, Parazynski says, and is less prone to user error by someone not as well trained in drone operation.

"I've flown aircraft and spacecraft," Parazynski says in an InnovationMap article about the company. "But none allowed for the precision of motion I was looking for. None prevented unintended motion."

The other Houston company selected as a finalist is Zibrio SmartScale, which is in the Health and Wearable category. The company is all about balance. Its product, a smart scale that tracks balance, aims to reduce dangers that come with poor balance — injuries, deaths, and costs from falls. Katharine Forth leads the company as CEO and founder. The company was a member of TMCx's 2015 medical devices cohort.

SXSW's competition this year has expanded to include new categories and has seen an increase in startups.

"We have seen a 42 percent rise in applicants coming out of last year's event, and we couldn't be more thrilled to see such an impressive increase in the value of SXSW Pitch among the tech industry's most innovative startups," says SXSW Pitch Event Producer Chris Valentine in the release. "In addition to the creation of the new AI and blockchain categories, we've also expanded our advisory board to highlight geographic, gender, and racial inclusion – accelerating our desire to represent the world's most innovative and successful leaders in all areas of technology."

It's not just in the finalists that Houston is represented — two advisers are from the Bayou City. Mariam Jacob, of Allergy and Asthma Clinics of Houston, will be a pre-event coach, and Gabriella Rowe, CEO of Station Houston, will be an on-site coach.

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Building Houston

 
 

Cloudbreak Enterprises is getting in on the ground level with software startups — quickly helping them take an idea to market. Photo via Getty Images

Lauren Bahorich is in the business of supporting businesses. In February 2020, she launched Cloudbreak Enterprises — B-to-B SaaS-focused, early-stage venture studio — with plans to onboard, invest in, and support around three new scalable companies a year. And, despite launching right ahead of a global pandemic, that's exactly what she did.

Bahorich, who previously worked at Golden Section Ventures, wanted to branch off on her own to create a venture studio to get in on the ground level of startups — to be a co-founder to entrepreneurs and provide a slew of in-house resources and support from development and sales to marketing and administration.

"We start at zero with just an idea, and we partner with out co-founders to build the idea they have and the domain expertise and the industry connections to take that idea and built a product and a company," Bahorich says.

Bahorich adds that there aren't a lot of venture studios in the United States — especially in Houston. While people might be more familiar with the incubator or accelerator-style of support for startups, the venture studio set up is much more intimate.

"We truly see ourselves as co-founders, so our deals are structured with co-founder equity," Bahorich says, explaining that Cloudbreak is closer to a zero-stage venture capital fund than to any incubator. "We are equally as incentivized as our co-founders to de-risk this riskiest stage of startups because we are so heavily invested and involved with our companies."

Cloudbreak now has three portfolio companies, and is looking to onboard another three more throughout the rest of the year. Bahorich runs a team of 15 professionals, all focused on supporting the portfolio. While creating the studio amid the chaos of 2020 wasn't the plan, there were some silver linings including being able to start with part-time developers and transition them to full-time employees as the companies grew.

"Within the first month, we were in shutdown here in Houston," Bahorich says. "But it's been a great opportunity for us. Where a lot of companies were pivoting and reassessing, we were actually able to grow because we were just starting at zero ourselves."

Cloudbreak's inaugural companies are in various stages and industries, but the first company to be onboarded a year ago — Relay Construction Solutions, a bid leveling software for the construction industry — joined the venture studio as just an idea and is already close to first revenue and potentially new investors. Cloudgate is also creating a commercial real estate data management software and an offshore logistics platform. All three fall into a SaaS sweet spot that Bahorich hopes to continue to grow.

"We are looking to replace legacy workflows that are still performed in Excel or by email or phone," Bahorich says. "It's amazing how many opportunities there are that fit into that bucket — these high-dollar, error-prone workflows that are still done like it's 1985."

Given the hands-on support, Bahorich assumed she'd attract mostly first-time entrepreneurs who don't have experience with all the steps needed to launch the business. However, she says she's gotten interest from serial entrepreneurs who recognized how valuable the in-house support can be for expediting the early-stage startup process.

"What I'm realizing is a selling point is our in-house expertise. These founders are looking for technical co-founders," Bahorich says. "We can both provide that role and be capital partners."

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