An on-line tutoring service and custom-fit earphones offer high-tech solutions for students and sore ears making them this year’s Olin Cup winners. Virtual Nerd and Verto emerged from the pack to win a $70,000 investment award and a $5,000 cash prize respectively.
Now in its 11th year, the Olin Cup competition is presented by the Olin School of Business and the Skandalaris Center at Washington University. Ken Harrington, managing director of the school’s Skandalaris Center, says there was an increase in both the diversity of ideas and number of entrepreneurs this year.
Harrington explains that the Olin Cup provides budding entrepreneurs with valuable exposure. “The competition and the judges play an important role in helping entrepreneurs turn their ideas into viable businesses,” he says. “Contestants receive feedback from judges and get in front of potential funders.”
Olin Cup participants face a rigorous year-long competition and are eliminated through a series of business planning challenges by a team of
27 judges comprised of Washington University faculty, venture capitalists, entrepreneurs and members of the business community.
Since 2001, more than 100 new businesses have been formed by students and alumni as a result of the competition and are still in operation today Harrington adds.
One of those successful start-ups is this year’s winner—Virtual Nerd. The idea for an interactive, multi-media tutorial website to help students in math and science came to Washington University M.D./Ph.D. student Leo Shmuylovich, co-founder of Virtual Nerd, while he was tutoring students one-on-one.
Shmuylovich wanted to be able to offer more students the advantage of tutoring and make it affordable. With his business partner Josh Salcman, the two have created an interactive site that tracks students’ questions and progress which can be shared with parents and teachers to improve the learning process.
“Winning the Olin Cup was a huge boost for us,” says Salcman. “Beyond the availability of the investment capital, the win was confidence-building and opened a number of doors for us. The win was exciting, but the process itself yielded as much long-term value.” Salcman adds, “The competition was a tremendously valuable networking opportunity, and we had a number of judges approach us afterward to offer both direct and indirect assistance.”
The fact that Virtual Nerd tested its concept at Chaminade Preparatory School in
St. Louis with great success helped make them a winner Harrington says. Ninth-grade students had access to a beta version of the site for three weeks leading up to a final exam in physics. Students used the site often and a post-pilot survey found that 90 percent of the students said they would recommend Virtual Nerd to a friend and over 70 percent of the students indicated they thought Virtual Nerd would be just as effective and more convenient than working with a private tutor.
Salcman and Shmuylovich, both from the East Coast, agree that their experience with Washington University and the St. Louis
business community has been “overwhelmingly positive.”
“We’ve benefited from an incredibly supportive and generous network of mentors. St. Louis offers remarkable resources for a city of its size, both in accessibility and low cost of living, especially in comparison with other regions,” Salcman says.
VERTO MEDICAL SOLUTIONS
If necessity is the mother of invention, then avid triathlete Seth Burgett’s idea was born out of his need to keep his own earphones in place during exercise. Burgett, president and CEO of Verto Medical Solutions, came up with his award-winning idea for custom-fit earbuds while participating in an iron man competition.
Burgett found extended-use of his iPod earphones was uncomfortable and prone to falling out of his ears. With a background in minimally invasive surgical devices for neurology, cardiology and ophthalmology, Burgett invented a unique imaging technology to digitally scan an individual’s ears and produce a malleable custom-fit ear-tip that attaches to iPod and mobile phone earbuds.
Verto’s “eartips” make earbuds comfortable and allow them to stay in during exercise and extended use. Burgett said the earbuds were developed with leading audiologists and can also help to reduce the potential for hearing loss. Verto plans to test market the device this summer at triathlon and marathon races
Burgett, currently a student in the Executive MBA program at Olin Business School, says that being part of the Olin Cup competition was a great experience.
“The Olin Cup Competition provided an accelerant to our venture by illustrating the gaps that would hold back private investors,” he says. “Since closing these gaps, we have steadily raised capital in some of the most challenging financial times and have achieved initial product sales through this use of funds.
Burgett continues, “The recognition by others that our venture has gone through the filtering process of the Olin Cup helps to reinsure private investors that the venture is sound. We expect to achieve the
$1 million milestone in private investment by the fall 2009,” Burgett states.
Harrington says Verto was a winner because their idea has a large market with a lot of demand, and they have a good management team behind the product.
Since winning the Olin Cup competition, Verto has scored a test market with Best Buy in up to 50 stores this October.
Although St. Louis is not in the initial 50 Best Buy test stores, Verto’s earbuds will be available here by going to the website, vertomedical.com, beginning in October.
St. Louisians can also go to one of the local scanning events to have their ears scanned and fitted with the custom earbud adapters for iPods and mobile phones. The earbuds sell for $20.
Following the initial Best Buy test, Burgett sees the potential for a nationwide launch in the spring, plus adding Apple and AT&T Wireless to its sales channels.
Ideas Into Action
The Olin School also sponsors two other programs for up and coming entrepreneurs: IdeaBounce and Social Entrepreneur Innovation Contest.
Those with hopes of turning an idea into action can float their idea on the website and get initial feedback. IdeaBounce.com offers people from across the region a place to collaborate in the development of new ideas. The website attracts people who are looking for mentors, advisors, investors, and other partners for their venture.
Idea Bounce holds public forums for 10 to 15 budding entrepreneurs to pitch their ideas in a two-minute presentation to a panel of judges selected from venture capital firms, incubators and other entrepreneurs. The next Idea Bounce event is scheduled for September 24th and is open to the public. The five best ideas are chosen and winners receive a private mentoring session.
“Programs like IdeaBounce and Social Entrepreneur Innovation Contest for non-profits are additional programs that help the region’s idea-stage entrepreneurs, including our students. We appreciate the support from our sponsors and the community in helping to grow the entrepreneurial environment in the region,” Harrington says.
Harrington adds that the future for entrepreneurs in St. Louis is bright. “We are really seeing opportunities for entrepreneurs
grow in this region. With the influx of life science companies, venture capitalists and funding, there are some very good things happening here.”
St. Louis Commerce Magazine and the RCGA are founding media sponsors for the Olin Cup.