Raising funds anytime soon? Take these tips from a venture capital insider into consideration. Photo via Getty Images

I have had the incredible opportunity to work with New Stack Ventures as a venture fellow, and after sourcing investment opportunities, shadowing calls with founders, and even leading a couple calls of my own, I have learned a few lessons that might resonate with startup founders who are raising capital.

Responsive founders make a difference

The first and likely most important lesson I have learned during my tenure as a fellow is this: responsive founders truly make a difference in whether or not they raise capital.

I have sent several emails and LinkedIn messages to really intriguing companies, in hopes of connecting for a call and inquiring about their raise. And, I look back and see that many of those outreach messages were left unread. I have also engaged in calls with really intriguing companies where the founder never follows up, and the idea of moving forward with next steps dissipates.

On the flipside of the forgetful founder, I have also witnessed extremely attentive founders: founders who send follow-up messages when they don't receive an immediate response, respond to their emails within the hour, and go above and beyond by sending pitch decks and executive summaries (even when unasked). This type of founder persona excites me with their enthusiasm and eagerness to make a deal. Their responsiveness with the investment process sheds light to how they likely run their businesses.

At the end of the day, many founders can say that they are hustlers and go-getters, but I believe the founders that show me through their actions in the investment process.

Great founders are great storytellers

When I do connect with founders in introductory calls (after the back-and-forth, hopefully responsive email exchange), the thing I look forward to most is hearing their stories. I want to know your story. I want to know what you were doing before your startup (and how that helped prepare you), how you thought of your idea, how you validated your assumptions, how you grew your business, and… everything in between (but all in less than five minutes of time).

Great founders are great storytellers. The great storytellers I have come across invite me into their companies' journeys, and leave me actually caring about their success.

On the opposite side of the spectrum, the founder who gives short responses and shows no real connection to their work (giving off the vibe that this is just another startup for them) leaves me unattached to them and their business.

Venture capitalists are more accessible than you might think

Perhaps, I gave this point away when I said that I was sending several emails and LinkedIn messages to founders (which sounds a little desperate), but VCs are way more accessible than you may think. Before working with New Stack Ventures, I had this perception that VCs were extremely hard to reach, exceptionally busy, and a little bit scary. And while one of the two latter characteristics still remains true, I can say with certainty that VCs are not hard to reach.

I can't speak for everyone in venture capital, but I do know that the VCs I work with will respond to founders who message them. Putting yourself out there, as a founder, can lead to advice (which bodes well for your business), a new connection in the industry (which bodes well for your network), and even an investment (which bodes well for the future of your startup). In the end, VCs are spending hundreds of hours, searching for a tractable startup that will change the game, and your startup could be the very gem they are looking for.

So, be bold, be responsive, and tell your story to any and every VC who will listen. I'm all ears.

Note: I was inspired to write this piece by by The Full Ratchet's tips for fundraising entrepreneurs, I thought I would share.

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Christa Westheimer is a Rice University student and the managing director at Rice Ventures. She is a current venture fellow at Chicago-based New Stack Ventures.

Here's why ClassPass tapped Houston as a prime place to expand. Photo via Getty Images

Why my global tech startup picked Houston for its next location

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Most people know that fitness and wellness leader ClassPass started in New York City. It's less well known that ClassPass has a large office in Missoula, Montana that houses several members of our leadership team, including CEO Fritz Lanman.

In 2017, the ClassPass team spent nine months conducting an intensive nationwide search for a city that matched our mission and values. As a brand focused on supporting an active lifestyle, we wanted a city that offered a connection to the outdoors. One of the most important driving factors in our search was finding a city where we could attract incredible talent to our team. Though we settled on Missoula, Houston was high on the list.

I'm thrilled that four years later, we are finally adding Houston as the fourth US ClassPass office. I have personally relocated to this city and now call myself a Houstonian. Here's five reasons why ClassPass chose Houston for our new US office:

Houston has a welcoming and collaborative culture

Since moving to Houston, every person I have met has been so welcoming. Locally founded tech companies are looking for ways to partner, and accelerators such as Houston Exponential have gone out of their way to make our transition smooth and facilitate introductions within the tech ecosystem. This is a friendly city, and one that encourages the growth of tech companies.

Great sports teams and miles of biking trails

Play is such an important part of the ClassPass culture (one of our values is "play to win"), and Houston is a dynamic place to do just that. With great sports teams, amazing museums, and tons of green space with miles of running and biking trails, there is something for everyone. And particularly in the winter when our colleagues are dealing with huge snow storms in NYC and Montana, it is such a treat to be able to spend time outside.

Self care is an important part of the culture

Locally, ClassPass partners with more than 900 Houston businesses including fitness centers, gyms, spas and beauty salons. In the Houston area, we have seen tremendous usage for both our fitness and wellness offerings, with members booking classes such as a full body strength class at Tropa Z Fitness or a Pilates session at 713 Pilates. Our beauty and wellness offerings are also popular, with people making the time for a sports recovery massage at Serenite Massage, a compression session at Restore Cryotherapy, or a bikini wax at Wink Lash Bar. It's important to us to know we are based in a city where the community embraces self-care, and where we can help local businesses to grow.

The legendary food

You need food to fuel your workouts! The food scene in Houston is incredible, and I am personally delighted to keep exploring and trying takeout from more places (I am currently on a quest for the best breakfast tacos!). Whether it's ordering lunch together once we are all able to be in-person, or going out for a meal after a new milestone is reached, I look forward to sampling the food scene with our new Houston team members.

The large talent pool

Houston is home to universities including Rice University and The University of Houston, and Texas A&M and UT Austin are nearby. With so much feeder talent coming out of local schools, and a reputation as one of the most diverse cities in the US, we are confident that Houston will be a place to recruit for teams across our organization.

Want to join our team? Check out open roles here.

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Rachel Moncton is the vice president of Global Marketing at ClassPass, the leading fitness and wellness membership and a global provider of corporate wellness benefits. She is based in Houston.

Virtual reality is a buzzword, but used correctly it can also be a pivotal business tool for external and internal uses. Photo via Getty Images

Houston expert: Is virtual reality just trendy tech or a viable business solution?

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Due to the pandemic, various technologies have accelerated into the spotlight – one of which being virtual reality. As many begin to decipher the unique ways to connect with audiences, the question becomes: is virtual reality just a shiny toy to have, or is it a practical business opportunity?

The VR experience

Virtual Reality (VR), which most confuse with augmented reality (AR), is a digital, immersive environment a user can place themselves into as opposed to a digital reality that is based on a real-world environment. VR requires a wearable headset to immerse the user in a 3-D environment.

True VR is built digitally and to room scale. The environments people are placed in are constructed entirely in 3-D and are then brought into a program application. Once everything is entered into the system, the technology begins "talking to" the headset and sensors. These devices track where users are in relation to the environment – and allow them to interact with their digital surroundings. This VR programming "tells" the headset what it needs to show in order to trick the eyes and brain into believing a user is "there".

The role VR plays

Often times, my company, VISION Production Group, receives requests and interest from businesses inquiring about a VR project. These conversations involve a deeper dive into understanding the purpose behind the want for the technology, the target audience and the intended deployment strategy. People commonly mistake VR for other technologies or simply are interested in it for its curb appeal.

Yes, virtual reality is a buzzword, but used correctly it can also be a pivotal business tool for external and internal uses.

External facing VR not only allows companies to take advantage of VR's charm, but also creates a one of kind experience for customers. VISION was tasked by an offshore oil and gas company to create a VR experience that lives at the bottom of the sea floor. This would allow the oil and gas company's customer to see a part of the process that would otherwise be extremely difficult to facilitate. The experience took users into a guided submarine tour where they were accompanied by others using the headsets. The environment not only showcased a faraway destination but also incorporated important details such as textures of the submarine that allows it to feel like they are truly there.

In addition to the promising use of VR externally, VR can also be used as training tools internally. Many scenario-based onboarding tasks can be difficult to facilitate such as: active shooter trainings, offshore emergency drills, and other safety simulations. Many corporate companies are turning to VR to allow for safe, cost effective and transportable safety trainings. This is an excellent application that allows companies to create situations that would otherwise be difficult to arrange.

Understanding VR's value proposition

VR is different than most technologies. It's not something that can be shared on the web or can be downloaded on an app – it requires deployment and gear. That said, VR is a commonly misunderstood tactic that without the proper strategic thinking can be a limited investment. However, those who are able to take advantage of the distinctive characteristics of VR and apply them correctly are in an ideal position to succeed. Not only can VR create a special experience it can also be a fiscally savvy option for those not looking to take submarine trips every day to the bottom of the sea or facilitate a dangerous training scenario.

The future of VR

As mentioned, most technology has accelerated due to the pandemic, but VR has actually been limited due to the idea of sharing a headset and gathering people together for an experience. Although, the pandemic has suppressed VR's uses, the technology advancements continue to grow rapidly.

Those who can comprehend VR for what it is and see it as more than just a buzzword will have the opportunity to be on the cutting edge of a new reality.

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Dan Pratt is the creative director at Houston-based Vision Production Group.

Trends in the TMT industry were largely driven by the disruptions related to COVID-19, but disruption also brings innovation and opportunity. Photo via Getty Images

Expert: What’s in store this year for the technology, media, and telecom industries in Houston

Guest column

As the new year begins, the impact of the pandemic and what it means for the future remains top-of-mind. COVID-19 has been a catalyst that has fostered change in many industries, including technology, media, and telecommunications (TMT). It's accelerated several trends such as the adoption of cloud technology, telehealth, and remote healthcare, and the intelligent edge.

In Deloitte's 2021 TMT predictions report, we highlight how worldwide trends could affect stakeholders and consumers across the globe. Here in Houston, we see the below trends as especially relevant for the year ahead.

Cloud technology and AI’s significant role

The evolution of instrumentation, automation and connectivity have led us to the "intelligent edge" – a new stage where the combination of advanced wireless connectivity, compact processing power and artificial intelligence have converged. Cloud computing, data analytics and AI are physically closer in the intelligent edge so that data can be rapidly analyzed and acted upon.

In 2021, Deloitte predicts the global market for the intelligent edge will expand to 12 billion, continuing a compound annual growth rate of around 35 percent. With this in mind, this type of technology can play a significant role across the industrial sector in terms of efficiencies and emissions reductions; many Houston companies are already leading in this space.

Additionally, Deloitte predicts that revenue growth will remain at or above 2019 levels (greater than 30 percent) for 2021 through 2025, largely driven by companies that are moving to the cloud in an effort to save money, become more agile and drive innovation. The maturation of the cloud industry during the pandemic has demonstrated resilience and we expect companies to continue to rely more heavily on the cloud in 2021.

Athletes by the numbers

Houstonians are some of the country's biggest sports fans, and in this era of the hyper-quantified athlete, data collection in sports is more prominent than ever.

The digital transformation of sports is in full swing and with it comes the explosion of data. Data collection – through video analytics, wearables, and smart fabrics – and how it is used raises new questions about data privacy for athletes. Deloitte predicts that by the end of 2021, multiple professional sports leagues will establish new formal policies around the collection, use and commercialization of player data.

Additionally, as seen in recent years, the use of high tech will also force teams to be more competitive, which may push boundaries and challenge our ideas about traditional sports.

Our new virtual reality

Last year, the pandemic halted in-person teaching and learning for many local educators and students. In addition, some Houston-based companies had to rethink their approach to onboarding new employees and skills training.

Some companies relied on virtual reality, augmented reality, and mixed reality solutions. These digital reality experiences helped simulate an in-person environment, which created a 50 percent spending increase on AR and VR headsets, software, and services. In 2021, sales for enterprise and educational use of wearable headsets for VR, AR, and MR could grow by 100 percent over 2019 levels.

COVID-19 also brought many industries online, including medicine. Deloitte projects the percentage of total virtual doctors' visits will rise to 5 percent globally in 2021. This means more potential business for the companies providing technologies to support virtual visits. We can also expect that the market for pure-play telehealth virtual visit solutions will reach $8 billion this year. And, we predict that more than $3 billion of medical-grade home health care technology will be sold in 2021, which represents an increase of almost 20 percent over 2019. Houston is already home to the world's largest medical center (Texas Medical Center) and we will likely see its footprint soar in 2021.

These trends in the TMT industry were largely driven by the disruptions related to COVID-19, but disruption also brings innovation and opportunity. As the world continues to wrestle in the grip of a global pandemic, there will likely be further implications that may affect TMT businesses and consumers worldwide and here in our hometown, Houston. To keep apprised of the latest trends, follow us on Twitter @DeloitteTMT.

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Nate Clark is the U.S. Oil, Gas & Chemicals Digital Practice Leader at Deloitte Consulting LLP. This publication contains general information only and Deloitte is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services.

Could tapping into 401k investment be a gamechanger for Houston startup funding? Photo via Getty Images

Expert: New 401k investment options would spur Houston venture capital and innovation

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With fossil fuels facing an uncertain future, Houston is wisely pushing to further develop its innovation economy with initiatives like Houston Exponential and Rice Management Company's Ion, as well as the No. 1 ranked entrepreneurship programs at the University of Houston (undergraduate) and Rice (graduate).

Venture capital is both the critical fuel and limiting factor to expanding Houston's innovation ecosystem, but the vast majority of venture capital in this country is focused outside of Houston in places like Silicon Valley and Austin. How can we increase the local pool of venture capital focused on Houston?

A recent federal guidance provides the answer with a new option for adding dramatically to Houston's venture capital resources. On June 3rd 2020, the Department of Labor issued an information letter allowing 401k funds to invest in private equity, including venture capital. Houston has hundreds of thousands of employees contributing to 401k retirement plans, including those working at our 41 Fortune 1000 companies as well as other major employers like the Texas Medical Center hospitals. If even a small fraction of their savings could be channeled into Houston-focused venture capital funds (or funds of funds like the HX Venture Fund), it could add hundreds of millions of dollars to Houston's startup ecosystem.

How would this work? While federal guidance does not allow direct private equity investments in 401k plans, it does allow private equity to be part of the mix in target date, target risk, or balanced funds offered. Imagine the creation of a "Houston Balanced Fund" focused on a portfolio of equities and bonds from Houston companies, local government bonds, and a 15 percent allocation to Houston-focused venture capital (the maximum allowed for illiquid assets). The fund would be a bet on a prosperous long-term future for Houston — something I think many Houstonians would enthusiastically add to their retirement portfolios. Once created, it could be added to the investment options in 401k employer plans all over the city.

As an example of the power of this model: if 100,000 employees — only 3 percent of 3 million jobs in the Houston metro — invested just $10,000 of their 401k portfolios into a Houston Balanced Fund with 15 percent allocated to venture capital, it would inject an additional $150 million dollars into the local venture capital pool to spur new innovations and companies that can be the future of Houston's economy — a 20 percent increase to the $715 million of venture capital invested in Houston in 2020. This new venture capital could be leveraged even more by focusing it on early-stage Houston startups that might have trouble attracting the attention of national VC firms. As they mature to Series B rounds and beyond, they should have no trouble bringing in capital from outside the region.

This is an opportunity for Houston to do something no other city has done — to be innovative with not just new ventures and technologies, but with how they're financed. We can be proactive pioneers fueling Houston's 21st-century innovation ecosystem.

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Tory Gattis writes the Houston Strategies blog and is a Founding Senior Fellow with the Urban Reform Institute – A Center for Opportunity Urbanism.
Need an in with a venture capital firm? Here's an idea. Photo via Pexels

Looking for VC funding? This Houstonian says to connect with venture fellows

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Every venture capitalist is searching for the next greatest startup that can change the world — as well as provide a sizable return on their investment. Everyone knows this. And because everyone knows this, most entrepreneurs are sending their pitch decks and executive summaries to venture associates and deal leads. But, I'd like to propose that every entrepreneur who's interested in raising capital begin to pitch their startups to venture fellows, college-aged students who work with investment firms.

I am a venture fellow at New Stack Ventures where my main objective is to source investment opportunities. During my tenure as a venture fellow, I have been sifting through online resources — from Crunchbase and AngelList to LinkedIn — with the hopes of finding a really neat startup that would earn an investment from New Stack Ventures.

A few weeks ago, Crunchbase had run dry of Houston startups that I hadn't reviewed. Because of this deal drought, I posted in the Houston Startups Facebook Group, asking if anyone had any startups that might fit our pre-filter criteria, and I was introduced to 15 startup founders in a matter of minutes. I posted again in the Austin and Dallas/Fort Worth Startups Facebook Groups with similar results.

These experiences showed me that there are several hidden startups that need funding. And there are several venture fellows that need to meet deal quotas and strongly desire to source a startup that earns an investment from their firm. So, perhaps, we could marry these two groups and help them both succeed.

Here are three tips for connecting with venture fellows.

1. Find your firm fit.

VC-RANK.com allows you to compile a list of best-fit venture capital firms for your startup. You can begin with your curated list. You likely won't find venture fellows on the firm's "Team" or "About Us" pages, so you might have to do some digging by looking at the firm's LinkedIn page and their employees.

If your curated list of VC firms doesn't happen to have venture fellows, you can always try reaching out to venture fellows from these firms: Open Scout, Ripple Ventures, .406 Ventures, Crescent Ventures, Alley Corp, and Fin Venture Capital.

2. Share your startup with several venture fellows.

Through a quick LinkedIn message, you can share your startup by including your company website, your contact email address, and your basic raise information (i.e. How much have you previously raised? How much are you raising right now?).

3. Await further communication.

I can't speak for all venture fellows, but most of us are just college kids who have been given the opportunity to learn a whole lot at VC firms. Contacting venture fellows can be a great (and low-risk) way to get your company's name immediately on the list of potential investment opportunities for your ideal firm. And, you would be helping any venture fellow out by making the effort.

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Christa Westheimer is a Rice University student and the managing director at Rice Ventures. She is a current venture fellow at Chicago-based New Stack Ventures.

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Photos: Here's a sneak peek at The Ion Houston's construction progress

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The Ion Houston is expected to open its doors this year, and the building's exterior is close to completion. Now, the construction team is focusing on interiors and then tenant build outs.

The 270,000-square-foot coworking and innovation hub owned and managed by Rice Management Co. is slated to be a convening building for startups, corporations, academic partners, investors, and more. The building is organized as follows:

  • The underground Lower Level will act as academic flex space with a few classrooms and open-concept desks for The Ion's accelerators, including: The Ion Smart and Resilient Cities Accelerator, DivInc, the Rice Alliance's Clean Energy Accelerator, and the Aerospace Innovation Hub and Accelerator. There will also be an event space and The Ion's own programming.
  • On the first, street-level floor, The Ion's restaurant tenants will reside with access from both the greenspace as well as into the building. The Ion's first three restaurant tenants include: Late August, Common Bond, and STUFF'd Wings.
  • Additionally, the first floor will be home to a venture studio and the prototyping lab. There is additional space available for other tenants.
  • On the second floor, there will be 58,000 square feet of coworking space managed by Common Desk. Note: For floors 2 and up of the Ion, tenants will have access cards that allow them entrance. The first and lower floors will not require access cards.
  • The third floor of the building will house eight to 10 tenants each with 5,000 to 10,000 square feet of space. Chevron was announced as the first tenant and will reside on this floor.
  • On the fourth and fifth floors, The Ion will house one to two larger tenants on each level. These levels of the building were added on to the existing structure. The fourth floor features two balconies that tenants will have access to. Microsoft is signed on to have its space on half of the fifth floor.
The Ion is still planning on an open date in late spring or summer. For leasing information, click here. Scroll through the slideshow of construction images and renderings to see the progress of the building.

Exterior nears completion

Photo by Natalie Harms

The building's exterior is almost complete and kept much of the original building's facade. The new materials brought in match the existing color scheme.

Texas winery taps Houston tech company for innovative AR experience

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The Lone Star State is home to a vibrant and innovative wine scene, but, just like most hospitality businesses, winemakers missed the opportunity to engage with their patrons amid the pandemic. With a new idea of how to engage its customers, Messina Hof, an award-winning Texas winery, rolled out a new tech-optimized, at-home experience.

The winery partnered with VISION, a Houston-based production group, to create an augmented reality app. Combining the efforts of Messina Hof's in-house label design team and the animation capabilities of VISION, the app took four months to design.

"It was a labor of love for both parties to be able to experiment with this; it was uncharted territory," says Karen Bonarrigo, owner and chief administrative officer of Messina Hof.

The three wines released — Emblaze (Sweet Red), Vitality (Dry White), and Abounding (Dry Red) — each tells a story through the AR experience.

"We wanted to try not only and push the technology as far as we can push it, but also try to really incorporate some heavy storytelling," says Dan Pratt, VISION Creative Director.

The idea to incorporate technology felt like a natural one to Bonariggo.

"The earth, water, and sunshine all go into developing what the profile is for each wine," explains Bonarrigo.

Each of the three wines have scannable labels that bring up a VR experience for app users. Photo courtesy of Messina Hof

VISION, who worked alongside Messina Hof to develop the project, blended the winery's rich family ties with the Old World history of winemaking.

When customers download the app and hold their camera over the label, a trailing vine emerges onto the screen and wraps around the bottle. As vines grow around each bottle, the three each visually signify a different natural element of winemaking — earth, water and the sun. As a rustic sign emerges, it prompts users to then click for recipe pairing recommendations.

Rather than a single-use experience, Messina Hof and VISION wanted to create an app that users could both engage with and learn from. The AR app allows users to view recipes and browse wines in one place.

"We knew we wanted the app to be functional for people to be able to interact with both when they're doing the AR experience, but then also to be able to continue to come back to it later," shares Bonarrigo. While AR wine labels have emerged in some California vineyards, she says, "it's definitely uncharted territory for the Texas industry."

Overseeing the food and wine pairing at Messina Hof is one of Bonarrigo's passions, so it was a natural choice to include recipes in the app. Messina Hof offers a concept called Vineyard Cuisine, coined from the Bonarrigo family cookbook, and incorporates wine in every meal at the vineyard.

"The idea of tying [the wine] to a recipe gave us the opportunity to be able to share new ways [our customers] could use wines in their everyday cooking," she explains.

She hopes the app's recipe feature will help families connect together.

"So often we get used to sitting down at the table, eating really quickly, and then moving on to the next thing, but there's so much connection that can happen with each other when we can slow down a little bit and have a conversation," she continues.

To Pratt, AR was the perfect way to emphasize and expand on the shared experience of wine.

"We wanted this to be an extension of that experience for people. You know, based on the love of wine and laughter with friends," he says.

For those who can't currently gather in a room together, Bonarrigo has hopes that Messina Hof can bring people together from afar.

"I think now more than ever the ability for our regular customers, even within Texas, to then share those wines with family members or friends that are outside the state seems more intuitive," she explains.

"We are so used to being creatures of habit in sharing our wine face-to-face with people that when we had the unexpected opportunity to not do that, we realized that we still have ways to be able to connect with customers through technology," says Bonarrigo.

She finds the "ease of access of being able to connect with them through the online web store" has kept Messina Hof in touch with customers throughout the pandemic, as well as digital happy hours and tasting events.

Messina Hof Harvest Green Winery & Kitchen, the newest location, opened in February, becoming the Greater Houston-area's largest winery. The space features an expansive tasting room and 83-foot wine bar, full-service restaurant, covered patio, two private tasting rooms, a wine production, barrel room, and wine warehouse.

"We knew that when we launched that location that we wanted to be able to have a series of wines at that location that was special, but also out of the box," says Bonarrigo.

Bonarrigo and her husband Paul have ushered in the expansion of Messina Hof over the last nine years. The family business began in 1977 when Paul's parents, Paul Vincent and Merrill, started an experimental vineyard. Messina Hof has locations in Bryan, Grapevine, Fredericksburg, and Richmond.

"This is our largest winery expansion endeavor that we've done," she says. "We wanted the wines to be extra special."

Similar to Messina Hof, companies across industries are seeking to explore interactive technologies to reach their customer base. "A number of our clients, and also new clients that we may not have been able to reach before, have certainly reached out to us to figure out new ways to reach an audience," shares Pratt.

Winemaking may be an Old World skill, but Messina Hof is excited to bring Texas wine into the future.

"So much of winemaking is science, and so much of it is art. There's always this push and pull as to which is more of a majority in the end product," explains Bonarrigo, who notes that Messina Hof has been using technology to innovate and optimize the growing process. The new AR app is a push toward bringing the experience her family loves into the homes of customers.

"This definitely gives a new talking point to wine," she says.