Overheard: Experts discuss why Houston is the next hub for tech investing

eavesdropping in Houston

HX Venture Fund recently hosted a virtual panel on how the tide has turned in Houston when it comes to tech investment. Getty Images

When Joe Alapat, co-founder and CEO of Liongard, was first getting started on his company, he says a few people recommended he go to Austin or one of the coasts to give his software company a better chance.

"For me, the thought process never really entered my mind that Houston was a place where I would be challenged in doing what I do well. My network is here," Alapat shared on a virtual panel hosted by the HX Venture Fund.

Turns out, it was a good decision. Liongard recently closed a $17 million series B round led by Updata Partners, a portfolio fund of HXVF. Moderated by Brian Richards of Accenture's Houston innovation hub, the panel asked Alapat, Sandy Guitar of HXVF, and Carter Griffin of Updata why Houston is the next hub for tech investing. Here are some key moments from the discussion.

“We’re cautious when we go into places — like Austin and Boston — where there’s a lot of activity both on the company side and the investor side. We’d rather find the opportunities where things aren’t as competitive and frothy, and you’re really dealing with people trying to build a real business, serve customers, and build value in the right way, and not just catch lightning in a bottle and build the next unicorn.”

—says Griffin about Updata's strategy of looking at cities like Houston in the middle of the country.

“A lot has changed in the past couple of years — the thought process, the awareness, as well as the willingness for folks to think about Houston as a place where you can build a startup.”

— says Alapat about how Houston's startup ecosystem has evolved since he started Liongard in 2015. He later notes that Houston's innovation leaders have done well to not copy other metros, but listen and learn from the successes and mistakes of other innovation cities.

“There was this feeling that we needed to be uniquely Houston — we couldn’t replicate Silicon Valley or Austin, we needed to be us. But we were going to have to do things differently. We couldn’t keep doing the same things and expecting this [change.]”

— Richard says, noting the corporate mindset, among other aspects of the ecosystem, shifted to be more focused on startups.

“The VCs are very interested in engaging in this model. So, we’re spoiled for choices is one way of saying it.”

— Guitar says on interest from venture funds in HXVF, noting that the VCs see an opportunity for their portfolio startups to connect with HXVF's corporate partners.
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Houston company premieres new platform for gig economy workforce

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As the independent workforce continues to grow, a Houston-based company is aiming to connect these workers with companies that match their specific needs with a new digital platform.

FlexTek, a 14-year old recruiting and staffing company, launched a first gig site tailored to the needs of the individual worker. The platform, Workz360, is built to be able to manage projects, maintain quality control, and manage billing and year-end financial reporting.The company is also working to expanding the platform to provide infrastructure to assist independent workers with education, access to savings programs, tax compliance through vetted third-party CPA firms, and hopes in the future to assist with access to liability and medical insurance.

With a younger workforce and a shifting economy, the “gig economy,” which is another way to describe how people can earn a living as a 1099 worker, offers an alternative option to the corporate grind in a post-pandemic workscape. Chief Marketing Officer Bill Penczak of Workz360 calls this era “Gig 2.0,” and attributes the success of this type of workforce to how during the COVID-19 pandemic people learned how to work, and thrive in non-traditional work environments. The site also boasts the fact it won’t take a bite out of the worker’s pay, which could be an attractive sell for many since other sites can take up to 65 percent of profit.

“In the past few years, with the advent of gig job platforms, the Independent workers have been squeezed by gig work platforms taking a disproportionate amount of the workers’ income,” said FlexTek CEO and founder Stephen Morel in a news release. “As a result, there has been what we refer to as ‘pay padding,’ a phenomenon in which workers are raising their hourly or project rates to compensate for the bite taken by other platforms.

"Workz360 is designed to promote greater transparency, and we believe the net result will be for workers to thrive and companies to save money by using the platform,” he continues.

As the workforce has continued to change over the years, a third of the current U.S. workforce are independent workers according to FlexTek, workers have gained the ability to have more freedom where and how they work. Workz360 aims to cater to this workforce by believing in a simple mantra of treating your workers well.

“We’ve had a lot of conversations about this, but we like the Southwest Airlines model,” Penczak tells InnovationMap. “Southwest Airlines treats their people very well, and as a result those employees treat the passengers really well. We believe the same thing holds true. If we can provide resources, and transparency, and not take a bite out of what the gig worker is charging, then we will get the best and the brightest people since they feel like they won’t be taken advantage of. We think there is an opportunity to be a little different and put the people first.”

NASA launches new research projects toward astronauts on ISS

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For the 26th time, SpaceX has sent up supplies to the International Space Station, facilitating several new research projects that will bring valuable information to the future of space.

On Saturday at 1:20 pm, the SpaceX Dragon spacecraft launched on the Falcon 9 rocket from NASA’s Kennedy Space Center in Florida — bringing with it more than 7,700 pounds of science experiments, crew supplies, and other cargo. The anticipated docking time is Sunday morning, and the cargo spacecraft will remain aboard the ISS for 45 days, according to a news release from NASA.

Among the supplies delivered to the seven international astronauts residing on the ISS are six research experiments — from health tech to vegetation. Here's a glimpse of the new projects sent up to the scientists in orbit:

Moon Microscope

Image via NASA.gov

Seeing as astronauts are 254 miles away from a hospital on Earth — and astronauts on the moon would be almost 1,000 times further — the need for health technology in space is top of mind for researchers. One new device, the Moon Microscope, has just been sent up to provide in-flight medical diagnosis. The device includes a portable hand-held microscope and a small self-contained blood sample staining tool, which can communicate information to Earth for diagnosis.

"The kit could provide diagnostic capabilities for crew members in space or on the surface of the Moon or Mars," reads a news release. "The hardware also may provide a variety of other capabilities, such as testing water, food, and surfaces for contamination and imaging lunar surface samples."

Fresh produce production

Salads simply aren't on the ISS menu, but fresh technology might be changing that. Researchers have been testing a plant growth unit on station known as Veggie, which has successfully grown a variety of leafy greens, and the latest addition is Veg-05 — focused on growing dwarf tomatoes.

Expanded solar panels

Thanks to SpaceX's 22nd commercial resupply mission in 2021, the ISS installed Roll-Out Solar Arrays. Headed to the ISS is the second of three packages to complete the panels that will increase power for the station by 20 to 30 percent. This technology was first tested in space in 2017 and is a key ingredient in future ISS and lunar development.

Construction innovation

Image via NASA.gov

Due to the difference of gravity — and lack thereof — astronauts have had to rethink constructing structures in space. Through a process called extrusion, liquid resin is used to create shapes and forms that cannot be created on Earth. Photocurable resin, which uses light to harden the material into its final form, is injected into pre-made flexible forms and a camera captures footage of the process, per the news release.

"The capability for using these forms could enable in-space construction of structures such as space stations, solar arrays, and equipment," reads the release. "The experiment is packed inside a Nanoracks Black Box with several other experiments from the Massachusetts Institute of Technology Media Lab and is sponsored by the ISS National Lab."

Transition goggles

It's a bizarre transition to go from one gravity field to another — and one that can affect spatial orientation, head-eye and hand-eye coordination, balance, and locomotion, and cause some crew members to experience space motion sickness, according to the release.

"The Falcon Goggles hardware captures high-speed video of a subject’s eyes, providing precise data on ocular alignment and balance," reads the release.

On-demand nutrients

Image via NASA.gov

NASA is already thinking about long-term space missions, and vitamins, nutrients, and pharmaceuticals have limited shelf-life. The latest installment in the five-year BioNutrients program is BioNutrients-2 , which tests a system for producing key nutrients from yogurt, a fermented milk product known as kefir, and a yeast-based beverage, per the release.

"The researchers also are working to find efficient ways to use local resources to make bulk products such as plastics, construction binders, and feedstock chemicals. Such technologies are designed to reduce launch costs and increase self-sufficiency, extending the horizons of human exploration," reads the release.

3 Houston innovators to know this week

who's who

Editor's note: In this week's roundup of Houston innovators to know, I'm introducing you to three local innovators across industries — from esports to biomaterials — recently making headlines in Houston innovation.

Zimri Hinshaw, CEO of BUCHA BIO

Zimri T. Hinshaw, CEO of BUCHA BIO, joins the Houston Innovators Podcast to discuss how he's planning to scale his biomaterials startup to reduce plastic waste. Photo courtesy of BUCHA BIO

After raising a seed round of funding, BUCHA BIO is gearing up to move into its new facility. The biomaterials company was founded in New York City in 2020, but CEO Zimri T. Hinshaw shares how he started looking for a new headquarters for the company — one that was more affordable, had a solid talent pool, and offered a better quality of life for employees. He narrowed it down from over 20 cities to two — San Diego and Houston — before ultimately deciding on the Bayou City.

Since officially relocating, Hinshaw says he's fully committed to the city's innovation ecosystem. BUCHA BIO has a presence at the University of Houston, Greentown Labs, and the East End Maker Hub — where the startup is building out a new space to fit the growing team.

"By the end of this month, our laboratories will be up and running, we'll have office space adjacent, as well as chemical storage," Hinshaw says on the Houston Innovators Podcast. Listen to the episode and read more.

Kelly Klein, development director of Easter Seals Greater Houston

A nonprofit organization has rolled out an esports platform and event to raise awareness and funding for those with disabilities. Photo via Easter Seals

For many video games is getaway from reality, but for those with disabilities — thanks to a nonprofit organization —gaming can mean a lot more. On Saturday Dec. 3 — International Day of Persons with Disabilities — from 1 to 9 pm, Easter Seals Greater Houston will be joining forces with ES Gaming for the inaugural Game4Access Streamathon.

Gaming helps enhance cognitive skills, motor skills, improve mental well-being, and can help reduce feelings of social isolation due to the interactive nature of playing with others.

“This is really a unique way for (people) to form a community without having to leave their house, and being part of an inclusive environment,” says Kelly Klein, development director of Easter Seals Greater Houston. ”The adaptive equipment and specialized technology just does so many miraculous things for people with disabilities on so many levels — not just gaming. With gaming, it is an entrance into a whole new world.” Read more.

John Mooz, senior managing director at Hines

Levit Green has announced its latest to-be tenant. Photo courtesy

Levit Green, a 53-acre mixed-use life science district next to the Texas Medical Center and expected to deliver this year, has leased approximately 10,000 square feet of commercial lab and office space to Sino Biological Inc. The Bejing-based company is an international reagent supplier and service provider. Houston-based real estate investor, development, and property manager Hines announced the new lease in partnership with 2ML Real Estate Interests and Harrison Street.

“Levit Green was meticulously designed to provide best-in-class life science space that can accommodate a multitude of uses. Welcoming Sino Biological is a testament to the market need for sophisticated, flexible space that allows diversified firms to perform a variety of research,” says John Mooz, senior managing director at Hines, in a press release. “Sino is an excellent addition to the district’s growing life science ecosystem, and we look forward to supporting their continued growth and success.” Read more.Read more.

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