Houston 'RedBox of dry cleaning' startup wins the Rockets' Launchpad Contest and pockets a $10,000 prize

Winner, winner

Houston-based Hamper, which makes dry cleaning convenient, won the Rockets and BBVA Compass' LaunchPad competition. Courtesy of Hamper

Safir Ali and his brother, Mubeen, thought they had a better way to improve and modernize the dry cleaning user experience, and, lucky for them, the judges behind the 2019 LaunchPad Contest agreed.

The contest, sponsored by the Houston Rockets and BBVA Compass, will reward Hamper with a $10,000 prize, along with a consultation with Rockets and BBVA Compass executives and a host of other prizes. But winning the startup competition, which seeks to recognize Houston-area entrepreneurs using technology to advance their businesses, has been icing on the cake for Hamper's successes.

The brothers grew up in their parents' dry cleaning store. After school and over summer vacations, the boys would work in the shop, which their father founded shortly after emigrating to the U.S. in 1989.

"I had this 'aha' moment in 2016," Safir says. "I had graduated from Texas A&M in 2014 and was working a corporate job and the last thing on my mind was joining the family business. But I started to see all the pain points for people in dry cleaning."

The biggest, he observed, was the inconvenience of it all. He'd notice people rushing to collect their shirts and suits in the after-work hours between 5 and 7 p.m., harried looks on their faces in the sprint to get there in time, relief that they'd made it before the doors closed at 7.

"'I'm so glad you're still open!' they'd tell us," he says. "And I thought, there really has to be a better way."

That better way, he and Mubeen are betting, is Hamper. Safir describes it as "the Red Box of dry cleaning." Customers can deposit their dry cleaning in a kiosk in their office building, and it will be delivered straight to their suite. Originally, Safir thought the kiosks could be stand-alones, but it proved to be easier to partner with high-traffic office spaces, like those in the busy Galleria or over in Williams Tower.

Hamper's concept is two-pronged, but simple. Before the company even built a drop-off kiosk, they created an app that would allow people to schedule when a driver could come and collect their dry cleaning. Using technology similar to the kinds of location software Uber uses, Hamper users could create an account, tick off what items they needed laundered or dry cleaned, then select both a pick up and a drop off time. A Hamper driver would come and collect the items, and then return with them fully pressed and cleaned.

The app launched in 2017, but it was never the end game.

"The kiosk prototype took us a year and a half to build out," says Safir, who enlisted the help of some friends who'd studied mechanical and electrical engineering to do it. Last summer, Hamper started a pilot program for the kiosks, setting them up in three Class-A office buildings.

"The idea is that the buildings and offices can offer dry cleaning as another amenity," says Safir.

For customers, using a Hamper kiosk is easy. The first time they visit the kiosk, they input their mobile phone number, then create an account with their name and office suite. They then scan the special Hamper bag they've picked up either from a promotional visit by Hamper or from the kiosk itself. Each bag has a unique QR code that becomes attached to the customer record. Once the bag is scanned, customers receive a text message to connect with Hamper and complete their order, listing the items they've put into the bag and inputting payment information. They then seal the bag and drop it into the kiosk. Hamper drivers collect all of the bags, and bring them to the Ali family's dry cleaning shop, where they are laundered. Once they're ready, the items are brought back to the offices. Customers keep the dry cleaning bags for their next order.

"We strive for excellence, both in terms of price and quality of service," says Safir, who's a member at Station Houston. "When the garments come in and when they go out, we have a seven-point inspection system. If a seam's come loose or a button has been broken somewhere along the way, we fix that."

Being able to combine the quality of a family business with 21st century technology has been exciting for Safir. The kiosk software was built in Angular, and is now hosted on React JS. Hamper's revamped website is about to make the transition to React JS, having formerly existed on Angular.

"The cool thing for us is that we're gearing up to build software for our dry cleaning facility – we call it the plant," says Safir. "We want to revamp the traditional experience where each garment is given an individual ticket and someone staples that onto the garment and pushes it through the system."

He envisions a system where a permanent barcode will be imprinted on a particular garment's care tag, so that whenever that garment comes back to Hamper, all the information about its cleaning will be there: does the customer like light starch, does it need some sort of additional care.

"If we can automate that intake process, we can be more efficient," says Safir. "At some point, I'd love to look at using AI to do things like spot stains or other damages before we wash the garments."

Safir knows he's disrupting the family business, and he readily admits that his father looked at him and his brother like they were crazy when they first broached the idea. But he came to appreciate the brothers' worth ethic, which Safir says they inherited from their mom and dad,and the idea that his sons were making a dream of his come true.

"For as long as I can remember, my dad talked about wanting a warehouse space in addition to a retail store," says Safir. "And thanks to the business we've brought in, we're working to make that a reality. We'll probably move in in September."

Once they do, Safir knows, two generations of dry cleaners will co-exist, using the tools of their centuries to continue their business.

In addition to the prize money from the Rockets Launchpad Contest, Hamper will also be recognized in a joint press release announcing the company's win, as well as getting some love at halftime at an upcoming Rockets game and having the win posted on social media.

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Houston startup adviser on navigating SAFE, convertible notes in funding rounds

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As both a founder and occasional early-stage investor in the Houston ecosystem, I've seen firsthand the opportunities and challenges surrounding seed funding for local startups. This critical first fundraising round sets the trajectory, but navigating the landscape can be tricky, especially for first time founders who may not be familiar with the lingo.

One key dynamic is choosing the right deal structure — SAFEs (Simple Agreement for Future Equity) vs. convertible notes are the most common vehicles early stage startups use to raise capital and are far more founder-friendly than a priced round.

Let's start first with what the have in common:

Both allow you to defer setting a valuation for your company until a later (likely priced) round, which is useful in early stages or pre-revenue companies
Both are cheaper and faster to execute than a priced round, which cash-strapped early stage founders like
Both can have terms like valuation cap, discount, conversion event, and pro rata rights.
Both are less attractive to investors seeking immediate equity (especially important if starting the QSBS clock is part of your investors strategy or if the investor is newer to startup investing)
Both can create messy cap tables and the potential for a lot of dilution for the founders (and investors) if they are used for multiple raises (especially with different terms)

While as you can see they have similarities, they have some important differences. Let's dig in on these next:

SAFEs:

Created by Y Combinator in 2013, the intent was to create a simplified, founder friendly agreement as an alternative to the convertible note
Is an agreement for future equity for the investor at a conversion event (priced round or liquidation event) which converts automatically.
It's not a debt instrument and does not accrue interest or have a maturity date.
Generally have much lower upfront legal costs and faster to execute

Convertible Notes:

A debt agreement that converts to equity at a later date (or conversion event like a priced round)
Accrues interest (usually 2 to 8 percent) and has a maturity date by which the note must either be repaid or convert to equity. If you reach your maturity date before raising a qualifying round, you can often renegotiate to extend the maturity date or convert the note, though be prepared to agree to higher interest rates, additional warrants, or more favorable conversion terms.
More complex and take longer to finalize due to non-standard terms resulting in higher legal and administrative costs

It's worth reiterating that in both cases, raising multiple rounds can lead to headaches in the form of complex cap tables, lots of dilution, and higher legal expenses to determine conversion terms. If your rounds have different terms on discounts and valuation caps (likely) it can cause confusion around equity and cap table structure, and leave you (the founder) not sure how much equity you will have until the conversion occurs.

In my last startup, our legal counsel — one of the big dogs in this space for what it's worth — strongly advised us to only do one SAFE round to prevent this.

Why do some investors tend to prefer convertible notes?

There are a few reasons why some investors, particularly angel investors from developing startup ecosystems (like Houston), prefer convertible notes to SAFEs.

Because they are structured as debt, note holders have a higher priority than equity investors in recovering their investment if the company fails or is liquidated. This means they would get paid after other creditors (like loans or credit cards) but before equity investors, increasing the likelihood of getting some of their money back.
The interest terms protect investors if the founder takes a long time to raise a priced funding round. As time passes, interest accumulates, increasing the investor's potential return. This usually results in the investor receiving a larger equity stake when the note converts. However, if the investor chooses to call in the note instead, the accrued interest would increase the amount of money owed, similar to a traditional loan
More defined conversion triggers (including a maturity date) gives investors more control and transparency on when and how their investment will convert.
Can negotiate more favorable terms than the standard SAFE agreement, including having both a valuation cap and a discount (uncommon on a SAFE, which usually only has one or the other), interest rates, and amendment clauses to protect them from term revisions on earlier investors by future investors (called a cram-down), etc.

We'll go over what the various terms in these agreements are and what to look out for in a future article

How to choose:

Consider your startup's stage and valuation certainty — really uncertain or super early? Either of these instruments are preferable to a priced round as you can defer the valuation discussion
Assess investor preferences in your network — often the deciding factor if you don't have a lot of leverage; most local angels prefer c-notes because they see them as less risky though SAFEs are becoming more common with investors in tech hubs like Silicon Valley
Evaluate your timeline and budget for legal costs — as I mentioned, SAFEs are way less expensive to execute (though still be prepared to spend some cash).
Align the vehicle with your specific goals and growth trajectory

There's no one-size-fits-all solution, so it's crucial to weigh these factors carefully.

The meanings of these round terms like "seed" are flexible, and the average seed funding amount has increased significantly over the past decade, reaching $3.5 million as of January 2024. This trend underscores the importance of choosing the right funding vehicle and approach.

Looking ahead, I'm bullish on Houston's growing startup ecosystem flourishing further. Expect more capital formation from recycled wins, especially once recently minted unicorns like High Radius, Cart.com, Solugen, and Axiom Space exit and infuse the ecosystem with fresh and hungry angels, new platforms beyond traditional venture models, and evolving founder demographics bringing fresh perspectives.

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Adrianne Stone is the principal product manager at Big Cartel and the founder of Bayou City Startups, a monthly happy hour organizer. This article original ran on LinkedIn.

Innovative Houston nonprofit partners with county organization to provide maternal health services

TEAM WORK

PUSH Birth Partners, a Houston-based maternal health nonprofit, is teaming up with the Harris County Public Health Department to provide doula services for over 200 pregnant people free of cost.

Jacqueline McLeeland, CEO and founder of PUSH, says the program will begin in August and aims to improve maternal health and birth outcomes for vulnerable populations. McLeeland says the organization has built up a strong doula training program through their collective in partnership with March of Dimes and several local doula organizations.

McLeeland says PUSH aims to address poor maternal health outcomes for women of color in part by training more doulas of color who can help reduce racial disparities in care. A 2021 study by Harris County Public Health found Precinct 1, which is predominantly composed of people of color, had the highest maternal mortality rate of the county.

Through their collective, PUSH has trained two cohorts of doulas through an integrated care model, focused on providing collaborative care with medical providers in the healthcare system.

“Our programs are designed to advance health equity, we see the numbers, we see that women of color, specifically Black women in that group are disproportionately impacted,” McLeeland tells InnovationMap.

After receiving a $100,000 grant from the Episcopal Health Foundation in 2023, PUSH began their doula expansion program in Houston and they have since received an additional grant from EHF for the next fiscal year. McLeeland shares PUSH has also launched a pilot program called Blossoming Beyond Birth, sponsored by the Rockwell Fund, targeted towards improving maternal mental health through weekly support groups in Houston.

“It’s very exciting to know that we have come this far from where we started and to see how everything is coming together,” McLeeland shares.

Jacqueline McLeeland serves as chief executive and founder of non-profit PUSH Birth Partners who has trained and collaborated with a network of doulas for the partnership. Photo courtesy of Jacqueline McLeeland

For McLeeland, improving maternal health outcomes and providing support to people experiencing high-risk pregnancies are deeply personal goals. McLeeland has sickle cell anemia, a condition that can cause serious complications during pregnancy. During her first pregnancy in 2015, McLeeland was placed on bed rest two months before her due date at which point she had been working in clinical research within the pharmaceutical industry for over 12 years.

“People don’t realize the magnitude of what women go through, during pregnancy and after,” McLeeland says. “There’s a lot of emotional, psychological, and physical tolls depending on how the pregnancy and delivery went.”

After giving birth to her first child, McLeeland took maternity leave, during which she began to research maternal morbidity and mortality trends, information which she says was not widely discussed at the time.

McLeeland says entering the maternal healthcare field felt like a necessity following her second pregnancy. Several months after giving birth to her second child, McLeeland says she received a bill for a surgical procedure that was performed during her cesarean section without her or her husband’s consent. McLeeland says that was the first time she was made aware of the surgery.

“The procedure that was claimed to have been performed could have put my life in jeopardy by hemorrhaging based off of additional research I did once, I came across that information,” McLeeland explains. “These are some of the things that happen in the healthcare system that make people skeptical of trusting in the healthcare system, trusting in doctors.”

McLeeland says the key to improving maternal and birth outcomes for vulnerable populations is to encourage the partnership between doulas, community healthcare workers, and physicians and hopes to further this collaboration through future programming.

Houston-based clean energy site developer raises $300M to decarbonize big tech projects

fresh funding

Houston energy executives have started a new company dedicated to developing clean-powered infrastructure for the large electric loads.

Cloverleaf Infrastructure, dually headquartered in Houston and Seattle, Washington, announced its launch and $300 million raised from NGP and Sandbrook Capital, two private equity firms. The company's management team also invested in the company.

As emerging technology continues to grow electricity load demand, Cloverleaf has identified an opportunity to develop large-scale digital infrastructure sites powered by low-carbon electricity.

"The rapid growth in demand for electricity to power cloud computing and artificial intelligence poses a major climate risk if fueled by high-emission fossil fuels," David Berry, Cloverleaf's CEO, says in a news release. "However, it's also a major opportunity to catalyze the modernization of the US grid and the transition to a smarter and more sustainable electricity system through a novel approach to development.

"Cloverleaf is committed to making this vision a reality with the support of leading climate investors like Sandbrook and NGP."

Berry, who's based in Houston, previously co-founded and served as CFO at ConnectGen and Clean Line Energy Partners, clean energy and transmission developers. Last year, he co-founded Cloverleaf with Seattle-based Brian Janous and CTO Jonathan Abebe, who most recently held a senior role at the United States Department of Energy. Nur Bernhardt, director of Energy Strategy at Microsoft who's also based in Seattle, rounds out the executive team as vice president.

"The large tech companies have become dominant players in the electricity sector, and they are genuinely determined to power their growth with the lowest possible emissions," Janous, who serves as chief commercial officer, says in the release. "Achieving this objective doesn't depend on disruptive new technologies as much as it does on dedicated teams working hand in hand with utility partners to maximize the use of the clean generation, storage, and other technologies we already have."

Cloverleaf will work with regional U.S. utilities and data center operators to provide clean electricity at scale through strategic investments in transmission, grid interconnection, land, onsite power generation, and electricity storage, per the release.

"The sustainable development of digital infrastructure at scale is fundamentally a technical power problem," Alfredo Marti, partner at Sandbrook, adds. "We have witnessed members of the Cloverleaf team effectively address this challenge for many years through a blend of creativity, specialized engineering, a partnership mindset, and astute capital deployment."