Only time will tell how Houston did for startup fundraising in 2019, but in the meantime, here's what stories of venture capital tended on InnovationMap. Getty Images

Editor's note: As 2019 comes to a close, InnovationMap is looking back at the year's top stories in Houston innovation. When it came to the money raised in Houston, five stories of new funds and closed rounds trended among readers.

These 7 Houston startups closed millions in funding in September

Seven Houston startups are beginning October with fresh funding. Photo by Tim Leviston/Getty Images

September was a busy month for several Houston startups. Seven companies closed rounds throughout the month and are now beginning the fourth quarter of 2019 with fresh funds.

InnovationMap has rounded up these seven deals based on previous stories as well as new information. Scroll through to see which Houston startups are catching the eyes — and cashing the checks — of investors. To continue reading this top story, click here.

3 TMCx companies have raised funds while completing the Houston accelerator

Three companies in TMCx's current cohort are leaving the program with new funds. Courtesy of TMCx

The Texas Medical Center's accelerator program is wrapping up its Digital Health cohort this week with the culmination of its TMCx Demo Day, and, while all of the companies have something to celebrate, three have announced that they are leaving the program with fresh funds.

Meru, Roundtrip, and Sani Nudge have raised over $10 million between the three companies. All three will be presenting at the TMCx Digital Health Demo Day on June 6 with the 16 other companies in the cohort. To continue reading this top story, click here.

5 Houston startups beginning 2019 with new capital

These five companies are starting 2019 out with some cash, and here's what they plan on doing with it. Getty Images

Finding growing Houston startups is as easy as following the money, and a few local companies are starting 2019 strong with a recent round of funding closed. InnovationMap has rounded up a few recent raises to highlight heading into the new year. To continue reading this top story, click here.

Exclusive: Houston-based stadium ordering app closes near $1.3 million Seed round with plans to scale

Houston-based sEATz has closed a funding round and plans to reach more fans than ever this football season. Courtesy of sEATz

Fans across the country are headed to football stadiums this weekend to cheer on their teams, but only a few will have the luxury of ordering food, beer, and even merchandise from the comfort of their seats.

Houston-based sEATz has created a platform where fans can order just about anything their stadium has from an app. Much like any other ordering app, once the order is placed, a runner will pick up the food and deliver it to the customer for a small fee and a tip.

The startup is now preparing to scale up from seven venues to 10 before the year is over as well as launching a new version of the app thanks to an oversubscribed near $1.3 million Seed round led by Houston-based Valedor Partners. Houston-based Starboard Star Venture Capital also contributed to the round. SEATz has plans to launch its Series A round before the new year. To continue reading this top story, click here.

Female-led venture capital firm launches in Houston to move the needle on investment in women-owned companies

A new venture capital firm launched in Houston to focus on female-led startups. Courtesy of The Artemis Fund

Three powerhouse investment minds have teamed up to launch a female-focused seed and series A venture capital firm in Houston.

In its first $20 million fund, The Artemis Fund will invest in around 30 women-led companies, and will award a $100,000 investment prize at the Rice Business Plan Competition, which takes place April 4 through 6. According to the company's press release, The Artemis Fund is the first of its kind — being female-led and female-focused — in Houston.

"There is a wealth of female leadership in the Houston innovation ecosystem, and we would like to see the same representation in the investor the investor community to help female founders thrive," says Stephanie Campbell, co-founder and principal of The Artemis Fund. To continue reading this top story, click here.


Texas venture capital deals had a slow quarter, according to Crunchbase data. Getty Images

Houston sees underwhelming venture capital funds in Q3 2019, following larger Texas trend

funding fumble

The entire state of Texas saw an unimpressive third quarter of venture deals — especially compared to the second quarter's reports — and Houston was not immune.

The state reported $372.4 million fundraised by tech startups in Q3 of 2019, according to Crunchbase data, which is less than half of what was reported in Q3 of 2018 ($776.8 million) and what the state raked in the second quarter of this year ($830.6 million).

Houston brought in a measly $38.4 million last quarter, per Crunchbase, and compared to the $251 million raised by Houston companies in Q2, that drop stings. It's the lowest quarterly venture amount Houston's seen in over a year, and lower than Houston's $44.7 million reported for Q1. Zooming out a little, the city's venture reports remain a rollercoaster of sorts with strong quarters bookended by lousy ones.

Chart via InnovationMap using Crunchbase data.

Austin maintained its top spot on the Texas venture leader board with $236.4 million of Texas' total $372.4 million raised in Q3 2019, according to Crunchbase, but that's about $200 million less than the city raised in Q2. Meanwhile, Dallas — a city Houston usually competes with for the No. 2 spot — raised $70.3 million compared to its $126.7 million raised in Q2. The only region up in raises is categorized as "other Texas metros," which went from $7.3 million to $27.4 million between Q2 and Q3.

According to Crunchbase, the city's $38.4 million was raised in six deals between June and September 2019. The top deal of those six companies was raised by Axiom Space, which closed a $16 million in a seed round.

Crunchbase's Texas reporter, Mary Ann Azevedo, reminds readers that their proprietary data is subject to reporting delays.

"Actual deal counts and dollar volume totals are higher than what Crunchbase currently has on record, and the numbers we're reporting today are likely to change as more data gets added to Crunchbase over time," she writes.

Just like Crunchbase, InnovationMap doesn't get to report on every single venture deal. However, here are some of the raises we covered in the third quarter of this year.

  • Spruce, a service provider for apartment residents, raised a $3 million round in July. The company moved its headquarters to Austin around the same time. Read more.
  • Grab, a mobile software company that's designed an airport mobile ordering app, closed a multimillion-dollar series A this summer. Read more.
  • Fannin Partners LLC, an early-stage life science commercialization company, closed a $5.25 million round this summer. Read more.
  • Voyager, a bulk shipping software company, raised $1.5 million in seed funding in August. Read more.
  • Cemvita Factory, which created a way to mimic photosynthesis, raised an undisclosed amount from corporate partners in August and September. Read more.
  • Galen Data, which uses its cloud-based software to connect medical devices, closed a $1 million seed round in September. Read more.
  • Syzygy Plasmonics, a hydrogen fuel cell creator, closed a $5.8 million Series A round in September. Read more.
  • sEATz, an app that allows in-seat ordering, closed a $1.3 million seed round in September. Read more.
  • Sourcewater Inc., which specializes in oilfield water intelligence, closed its series A round at $7.2 million in September. Read more.
  • Topl, a blockchain developer, raised over $700,000 in its seed round in September. Read more.
Seven Houston startups are beginning October with fresh funding. Photo by Tim Leviston/Getty Images

These 7 Houston startups closed millions in funding last month

Venture adventures

September was a busy month for several Houston startups. Seven companies closed rounds throughout the month and are now beginning the fourth quarter of 2019 with fresh funds.

InnovationMap has rounded up these seven deals based on previous stories as well as new information. Scroll through to see which Houston startups are catching the eyes — and cashing the checks — of investors.


Galen Data

Houston-based Galen Data is growing its clientbase and just formed two new partnerships with medical device companies. Photo via galendata.com

Texas Halo Fund led a Houston startup's seed round last month. Galen Data, which uses its cloud-based software to connect medical devices, closed a $1 million seed round thanks to the fund's $250,000 investment. Kevin King, one of Texas Halo Fund's managing director, has also been named to the startup's board of directors.

According to the release, the Texas Halo Fund based its decision for the investment "on the large and growing addressable market of connected medical devices, the company's impressive management team, and post revenue status."

Galen Data's emergence comes as the market for internet-connected mobile health apps keeps growing. One forecast envisions the global space for mobile health exceeding $94 billion by 2023.

"We want to be at the forefront of that technology curve," DuPont tells InnovationMap in a previous interview. "We might be six months early, we might be a year early, but it's starting to happen."

Earlier this year, Galen Data formed strategic partnerships with medical device companies. Click here to read more about those.

SurfEllent

Photo via surfellent.com

SurfEllent, an anti-icing coating technology startup founded out of the University of Houston has raised $470,000 in funding. The company won the second place award and a total of $45,000 at the Texas A&M New Ventures competition before receiving an anonymous investment of $350,000 in seed funding. SurfEllent also received two grants: a $50,000 Small Business Innovation Research grant and a $24,999 Small Business Technology Transfer grant.

"Ice is a problem that will exist as long as we live on the earth. It impacts a wide range of things, including aircraft wings and engines, automobiles, buildings and bridges, ships and vessels, and power transmission systems," says SurfEllent Co-Founder Hadi Ghasemi, a Bill D. Cook Associate professor of mechanical engineering at the UH Cullen College of Engineering, says in a news release.

SurfEllent's product can be used in the de-icing of cars and airplane engines.

"The end goal is to improve the quality of human life," Ghasemi says in the release. "This recognition is another proof of the critical need for advanced anti-icing coating technologies and opens opportunities for collaboration with various industries and business partners."

Cemvita Factory

Cemvita Factory

In August, Occidental Petroleum's Oxy Low Carbon Ventures LLC invested in Houston-based Cemvita Factory, and in September, BHP followed suit. While Cemvita Factory isn't able to disclose how much money its raised through these partnerships, the company confirms it has closed its round of funding.

Cemvita Factory is run by a brother-sister team. Moji and Tara Karimi built the company off of Tara's research into mimicking photosynthesis. The process is able to help reduce energy company's carbon emissions.

"We have an ambitious goal to take one gigaton of CO2 out of the carbon cycle in the next decade and are very excited about being a part of Occidental's journey to become a carbon-neutral company," says Tara, co-founder and chief scientist, in a news release.

The investments will help Cemvita Factory continue to develop its biomimicry technology for oil and gas applications to reduce the volume of greenhouse gas emissions.

Read more about Cemvita's technology by clicking here.

Sourcewater

oil and gas It might not be surprising to discover that the energy capital of the world is a hub for energy startups. Getty Images

Houston-based Sourcewater Inc., which specializes in oilfield water intelligence, closed its series A round at $7.2 million. Bison Technologies, Marubeni Corp., and major energy family offices in Houston, Midland, Dallas, and Oklahoma City contributed to the round. The funds will go toward further developing the company's technology.

"For every barrel of oil produced in the Permian Basin there are more than ten barrels of associated water that are sourced, recycled, transported, and disposed of," says Joshua Adler, founding chief executive of Sourcewater, in a news release. "When America became the world's leading energy producer last year, it also became the world's leading water producer, times ten. Water management is now the majority of upstream energy production cost, and water sourcing, recycling and disposal capacity is the primary constraint on America's energy future."

Read more about the raise here.

SEATz

sEATz

Houston startup sEATz has created a platform where fans can order just about anything their stadium has from an app. Much like any other ordering app, once the order is placed, a runner will pick up the food and deliver it to the customer for a small fee and a tip.

The startup is now preparing to scale up from seven venues to 10 before the year is over as well as launching a new version of the app thanks to an oversubscribed near $1.3 million seed round led by Houston-based Valedor Partners. Houston-based Starboard Star Venture Capital also contributed to the round. SEATz has plans to launch its Series A round before the new year.

"We're building enterprise-level, scalable in-seat ordering, delivery, and pick-up software. We'll have all the data and validation we need this fall to really start to push that out," says CEO and co-founder Aaron Knape.

Read more about sEATz's raise by clicking here.

Syzygy

Earlier this year, Trevor Best, CEO of Syzygy Plasmonics, walked away from EarthX $100,000 richer. Now, he has an even bigger check to cash. Photo via LinkedIn

Using research that came out of Rice University, Syzygy Plasmonics has developed a hydrogen fuel cell technology that produces a cheaper source of energy that releases fewer carbon emissions.

The company just closed a $5.8 million Series A round led by MIT's The Engine and Houston-based The GOOSE Society of Texas. Evok Innovations, a previous investor in the company, and angel investors from the Creative Destruction Lab also contributed to the round.

"We're starting to solidify relationships and get customers ready," CEO Trevor Best tells InnovationMap.

Read more about Syzygy's technology by clicking here.

Topl

blockchain

Houston-based Topl can track almost anything using its blockchain technology. Getty Images

Houston-based Topl, a blockchain network with applications across industries, closed a 20 percent oversubscribed $700,000 seed round.

"Every investor that is invested now has focused on both the purpose and the profit, and I'm big on that," Kim Raath, president and co-founder of Topl, says.

The team has built six blockchain platforms that operate on the Topl network — two are live now, and four will go live later this year. The platforms are focused on four different areas: agriculture (tracking food products from the farm to the shelves), mining (diamonds, for instance), sustainability and impact (tracking a program to see how it succeeds), and carbon credits and renewables within the energy industry.

Click here to read more about the raise and what it means to Topl's technology.

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Statewide accelerator hires new Houston staffer and embraces 'virtual first' approach amid COVID-19

new hire

For years, Capital Factory has existed to promote innovation and grow startups across Texas and has expanded from its headquarters in Austin to Dallas, Houston, and beyond. In light of COVID-19, the organization has pivoted to make sure it can work with startups remotely and online.

"I think Capital Factory has successfully embraced virtual first," says Bryan Chambers, vice president of the accelerator and fund at Capital Factory. "I think it's gone well and it feels like we're just hitting our stride."

Chambers admits that the onset of the coronavirus had a great effect on Capital Factory — SXSW being canceled did its damage on the organization, which has a huge presence every year. However, cross-state startup collaboration is the driving force behind Capital Factory's Texas Manifesto.

"We're one big state, and we're one big startup ecosystem," Chambers says. "The resources across Dallas, Houston, Austin, North Texas, and San Antonio are available for everybody. Candidly, COVID aligns with that. There's no better time — COVID is erasing the boundaries in a virtual world."

In addition to navigating the transition to virtual operations, Capital Factory has also introduced its newest Houston staff member, as Adrianne Stone has started this week as venture associate for the organization. Stone received her Ph.D in Translational Biology and Molecular Medicine from Baylor College of Medicine before heading out to the West Coast and working at 23andme. She brings both her experience with health tech and Silicon Valley to her position.

"The mindset in Silicon Valley is different from how it is here in Texas — in good ways and bad ways. It was interesting to be exposed to a very potent startup vibe," Stone tells InnovationMap. "I'm looking forward to being able to meet all the cool companies, founders, and investors we have here in the Houston area."

Stone replaces Brittany Barreto, who helped in coordinating her replacement and is staying on part-time for the rest of August to help with training and immersion into the ecosystem. Barreto, who is one of the founders of the recently launched startup masterclass Founder's Compass, has also introduced a new brand called Femtech Focus, that includes a podcast where she talks to innovators in the women's health and wellness space.

"I'm ready to get back into the founder's saddle," Barreto says, adding that there's more to come for Femtech Focus.

Throughout her tenure, Barreto has overseen Capital Factory's Houston portfolio companies — both identifying potential investment opportunities and connecting startups to resources and mentors. She passes the torch to her former BCM classmate, and says she's excited to do so to a fellow Ph.D.

"The last year and a half, I've working really hard on laying this foundation. I don't want all that hard work to go away, so I cared a lot about who was going to take my position," she says. "I wanted to make sure that all my founders had someone who cared about them as much as I do."

Impact Hub Houston has new HQ, HCC creates AI program, and more innovation news

Short stories

Houston's innovation ecosystem has been booming with news, and not all make the news. For this roundup of short stories within Houston innovation, a Houston startup incubator has a new home, a local school creates AI-focused program, Astros manager taps into sports tech, and more.

Impact Hub Houston makes downtown partnership

Impact Hub Houston has a new headquarters in downtown. Photo courtesy of Central Houston

Impact Hub Houston, a nonprofit organization that promotes and accelerates sustainability-focused startups, is resident partner at Downtown Launchpad, according to Central Houston and the Downtown Redevelopment Authority.

The organization now has a 10-year lease and a new headquarters for its team and events. Impact Hub joins two accelerator programs — MassChallenge Texas and gener8tor — which both have a global presence and launched in Houston in the past two years.

"We celebrate Central Houston's vision in launching this 'vertical village' and appreciate their ongoing support in including Impact Hub Houston as a part of it," says Grace Rodriguez, CEO and executive director of Impact Hub Houston, in a news release. "It takes a village to raise an entrepreneur, and now we have that village with the infrastructure and community to raise generations of diverse innovators. It's another exciting step towards our goal to build an authentically inclusive and equitable entrepreneurial ecosystem that looks like Houston and works for all in our region."

HCC introduces artificial intelligence program

Data science startup based in Houston focus on neuroscience software nabs $3.78M grant

A local college system is training the future AI workforce. Getty Images

Houston Community College is the first community college in the state to introduce a new program focused on artificial intelligence. The new Associate of Applied Science degree program has been approved by Southern Association of Colleges and Schools Commission on Colleges, according to a press release from HCC, and is available for the fall 2020 semester at HCC Southwest, HCC Northeast and HCC Southeast.

"It is the latest of HCC's ongoing efforts to embrace new technologies and keep a pulse on the ever-changing needs of the industry," HCC Chancellor Cesar Maldonado says in the release. "Offering an innovative program like AI will allow our students to take advantage of all the accelerated job openings in Houston, in Texas and beyond."

The new program exists to fill the rising need for AI professionals. Last year, the job site indeed.com identified machine learning engineers at the top of its annual list of the 25 best jobs, citing a 344 percent increase in job postings from 2015 to 2018 with an annual base salary of $146,000.

"Because of a dire shortage of AI specialists, many companies are offering big salaries," says G. Brown, Ph.D., program coordinator of Networking and Telecommunications at HCC Southwest, in the release. "AI specialists are in high demand by companies like Microsoft, Apple and Amazon, as well as NASA and SpaceX."

Rice project re-envisions dorm layouts

The dorm design created socially-distant spaces that can be used in times of a pandemic. Photo via rice.edu

Two Rice University students received top marks in the 2020 American Institute of Architects Houston (AIAH) Gulf Coast Green Student Competition for their pandemic-proof dorm design. Carrie Li and Mai Okimoto, both 2022 Rice master's of architecture students, won first place in the competition that challenged students to design a dorm for the University of Houston-Downtown that would adhere to the Centers for Disease Control's social distancing guidelines.

"Carrie and Mai's timely and innovative proposal is beautifully conceived, highly resolved and elegantly presented," says interim dean, John J. Casbarian, in a news release. "I am particularly struck by how seamlessly it addresses the pressing issues of flooding, natural ventilation and social distancing, and how well sited it is in relation to UHD while mitigating the adversity of the freeway expansion.The competition consisted of eight teams from Texas and Louisiana which presented to judges from Kirksey, PDR Corporation, Gensler, Walter P Moore and UH-D. Li and Okimoto's project features 432 units across three villages and even factored in the area's flooding challenges.

"[Our design] aims to: allow social interaction to happen on different scales, from the one-on-one connection to larger scale gatherings; provide the users with safe but varied circulation paths, through which natural ventilation also occurs; treat dining as a key socializing program; and address the site's flooding risks and impacts of the I-45 corridor expansion," Li says in the release.

City of Houston passes small business-focused economic relief initiative

A new program from the city of Houston is helping to provide funds for businesses affected by COVID-19. Getty Images

Last week, Mayor Sylvester Turner and the Houston City Council passed the city's Small Business Economic Relief Program, funded with $15 million of the City's allocated CARES Act 2020 funds. Small businesses can apply for up to $50,000 and the grant can be used for payroll, accounts payable, rent, mortgage, PPE for employees, marketing strategies, including creating an online presence and other sales alternatives.

"We know small businesses throughout Houston have suffered greatly due to the global pandemic, and it could take months or years before the business climate returns to normal," says Mayor Sylvester Turner in a news release. "I thank Vice Mayor Pro-Tem Martha Castex Tatum and other council members for bringing this program forward. We are working on other relief packages that will keep us Houston Strong as we navigate the public health crisis."

The program will be administered by Houston's Office of Business Opportunity and the Houston Business Development Inc.

To qualify for the SBERP, businesses must be located in Houston, have been in business for at least one year, provide evidence for revenue decrease due to COVID-19-caused closures, have less than $2 million in gross annual revenue pre-COVID-19, be in good standing with the city, and commit to complete technical assistance.

"The SBERP will help all sizes of small businesses move one step closer toward financial recovery. This program is intended to maximize the long-term, positive impact of these small businesses on our local economy through their contribution to job retention and the continued availability of their services," says Marsha Murray, director for the Office of Business Opportunity, in the release. "If our local small businesses did not qualify for other federal or local programs, or did not receive enough funds to mitigate the impact of the crisis, we encourage them to apply for this program."

Astros manager joins venture capital firm

Not only is Dusty Baker at the helm of the 2017 World Series-winning Astros, but he's also a founding partner of a sports-focused venture capital firm. Getty Images

The Houston Astros manager, Dusty Baker, is a founding partner of a new venture capital firm focused on sports tech and innovation. New York-based Turn2 Equity Partners is a new fund is beginning with a focus on amateur and professional baseball markets.

"For decades, baseball players, managers and executives have lended their credibility to brands as endorsers," Baker says in a press release. "With the establishment of Turn2 Equity, for the first time, faces of the game have the opportunity to own and influence people at all levels."

Co-founded by sports venture capitalists Jarett Sims and Peter Stein, the firm's team also includes Jim Duquette, New York Mets general manager; Bobby Evans, who was formerly with the San Francisco Giants as general manager; and John Haegele, the former CEO of Van Wagner Sports & Entertainment.

GotSpot Inc. wins veterans competition

A Houston startup that's using technology to optimize short-term real estate space took home a prize in a virtual pitch competition. Image via LinkedIn

Houston-based GotSpot Inc. has claimed another pitching competition prize for veteran-owned businesses. Reda Hicks, founder of the Houston startup, received third place and $10,000 at the Ford Fund Virtual Pitch Competition last month. Memphis-based Pure Light Clean Air Services took first place and $15,000 and Raleigh, North Carolina-based Blue Recruit won second place and $10,000.

"The experiences, teamwork and skills learned in service of our country can serve as a solid foundation for these men and women as they build sustainable businesses," says Yisel Cabrera, manager of the Ford Motor Company Fund, in a news release. "We're proud to work with Bunker Labs to assist these inspiring entrepreneurs as they pursue new roads to success."

Calling all energy startups

Upstream startups can submit to a new virtual pitch competition. Photo via atce.org

The Society of Petroleum Engineers is calling for applications from energy startups to compete in a virtual pitch competition. Applications for the ATCE Startup Village, which is a collaboration between SPE and the Rice Alliance for Technology and Entrepreneurship, are live online and due by August 14. The competition will take place Tuesday, October 13.

The competition is free to compete and to apply, and open to early stage upstream technology companies. Each company selected to present will have 5 to 8 minutes to provide a "quick pitch" about their company to a group of venture capitalists, angel investors, and industry leaders. Judging will be based on innovative technology, commercial strategy and business plan, market potential, and management team and advisers.

Rice University research: Collaboration with the community can be key to success

houston voices

In Pittsburgh, a coalition of 100 community groups brokered a deal with developers of the Pittsburgh Penguins ice hockey team for $8.3 million in neighborhood improvements. In Oakland, California, developers of an $800 million high-tech complex promised local residents 50 percent of its construction jobs. And in Chicago, the Obama Presidential Center is working with residents to shield them from skyrocketing rents.

Community Benefits Agreements, or CBAS, as these agreements are called, are increasingly common between businesses and the places where they want to set up shop. But are they worth the money? To find out, Rice Business professor Kate Odziemkowska joined Sinziana Dorobantu of New York University to analyze market reactions to 148 CBA announcements between indigenous communities and mining firms in Canada. The financial value of these agreements, the researchers found, was real.

While it's easy to imagine that CBAs are just costly giveaways, they're more than goodwill gestures. Instead, they are legally enforceable contracts to distribute benefits from a new project and to govern the response to any potential social and environmental disruptions. For businesses, the researchers found, they are also good strategy, because they prevent costly, drawn-out conflict.

To conduct their research, Odziemkowska and Dorobantu analyzed a sample of 148 legally binding CBAs signed in Canada between mining firms and indigenous communities between 1999 and 2013. In Canada, mining companies and indigenous communities often hammer out agreements about extraction and use of local resources. Studying only the mining sector let the researches control for the economic variations that characterize different industries.

Since CBA negotiations cannot be disclosed, the announcement of such agreements represents new market information. To conduct their study, the researchers tracked the market reaction to these announcements, using a technique that measured short-term returns.

Creating CBAs from the start, they found, can head off catastrophic costs later. That's because even when a company has disproportionate economic strength, the public relations, legal and economic costs of community conflict can be draining. Consider the 1,900-kilometer Dakota Access oil pipeline, whose developers faced six months of round-the-clock protests that included nearly 15,000 volunteers from around the world. The drumbeat of litigation and negative news coverage still continues today.

In general, the researchers found, the more experience a community has with protests or blockades, the more firms gained from signing a CBA. Property rights protections also provide strong incentive for making a deal. Mining companies, for example, need access to land to do business. Communities with robust property rights to the resource or location sought by the firm have strong standing to stop that firm if they don't make a deal.

Because access to valuable resources like land or intellectual property can mean the difference between financial success or failure, Odziemkowska and Dorobantu said, the lesson from their findings extends far beyond Canadian mines. It's a lesson Disney learned the hard way when it failed to acknowledge the culture of Norway's Sami people in "Frozen." Assailed for cultural appropriation by using, but not crediting, traditional Sami music, Disney quickly made amends. After negotiating with the Sami people, Disney pledged to consult with them and portray them thoughtfully in the film's sequel.

The deal may have cost Disney on the front end, but it was nothing compared to the advantage of freezing out years of bad press.

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This story originally ran on Rice Business Wisdom. It's based on research by Kate Odziemkowska, an assistant professor of Strategic Management at Rice University's Jones Graduate School of Business.