They came, they pitched, and, in the case of three industry startups, walked away with up to $20,000 to support their burgeoning enterprises. The winning trio, PermitZone, YAN Engines, and 5D Robotics, were selected from a field of 15 finalists at the Industrial Technology Pitch Competition, held at the South by Southwest (SXSW) Startup Village in Austin, TX, in mid-March.
The competition, fittingly enough, was sponsored by a quartet of capital investors led by Holt Ventures, a newly minted arm of equipment dealer Holt Caterpillar and Caterpillar Ventures, in collaboration with Brick & Mortar Ventures and Cottonwood Technology Fund, with winners selected on the basis of “their disruptive potential in the industrial space.”
If nothing else, the competition’s 15 finalists proved there is no shortage of innovation and entrepreneurship among industry members, with entries ranging from robotics and 3-D printing to field- and energy-management programs. “The companies made very solid presentations,” says Brian Lowry, investment manager of strategic development for Caterpillar Ventures. “For sponsoring groups such as ours, the event provided an opportunity to get to know those companies.”
The event also “served as a launching pad for Holt Ventures, indicating our desire to spur and share innovation with the industry,” says Adam Bridgman, director of corporate finance for Holt Companies
Finalists were culled from some 100 entrants, with five apiece selected for the categories of the seed stage, the advanced seed stage, and the series A/B stage.
Myrtle Beach, SC-based PermitZone emerged as the winner of the Seed Stage, receiving $105000 for a category whose criteria included: seeking seed funding, determined problem/solution fit, developed MVP, and establishing product market fit with early or line-of-site customer/partnership.
In a nutshell, the enterprise provides a custom software-based service that allows contractors and subcontractors involved in residential and light commercial construction to secure construction permits online, acting as a mediator among applicants and some 19,655 building departments nationwide, according to PermitZone cofounder and CEO Ray Antonino. Likewise, the enterprise provides a platform for municipalities seeking to provide online permitting.
For their part, contractors simply fill out a PermitZone-issued permitting application and upload corresponding plans for HVAC, plumbing, and so forth in a PDF format. “We ask that they complete only 85 percent of the application, leaving it to us to complete sections where mistakes that can kick the form back are most frequently made,” Antonino says, noting the mistakes typically include incorrect property names, tax map numbers, and licensing information pertaining to the contractor. “That information almost always is publicly available to us.”
Upon receiving the information, PermitZone works with the building departments to “pull” the permit, with the applicant receiving automated communications throughout the process. Although PermitZone is both a time- and cost-saver, Antonino has found that smaller contractors don’t appreciate or understand the savings involved in diverting a permit coordinator’s time to other activities. “They don’t recognize the costs and inefficiencies involved in sending staff off to a building department for several hours,” Antonino says.
As a result, PermitZone currently is targeting larger and savvier customers that ideally are involved in multiple projects at multiple locations, Antonino says.
Advanced Seed Stage
YAN Engines, an Austin, TX-based fuel-efficiency enterprise, was awarded $15,000 for the advanced seed stage, meaning start-ups seeking additional seed or bridge funding, with other criteria including seed stage plus established customer/partnership traction and positive revenue trends.
Founded in 2012, YAN produces differential stroke-cycle pistons (D-cycle) that serve as replacements in traditional internal combustion engines. The D-Cycle incorporates a split piston that alters the engine’s basic functionality and transforms the means by which it produces power and adapts to driver demand, improving fuel efficiency by 20 percent.
As designed, the split piston completes the four engine strokes in a single crankshaft revolution, reducing cyclic energy losses. The D-Cycle performs both functions in a single revolution by splitting the piston and deploying the lightweight top half for the low-stress functions of gas exchange and the combined halves for high-stress compression and combustion functions, according to company CEO Lu Yan.
“The application is well suited to a variety of construction equipment such as earth-moving equipment, in addition to on-site generators and shipping vehicles such as trucks or boats,” Yan says.
The enterprise recently developed a prototype D-Cycle for the U.S. Department Of Defense, the intent being to retrofit a fleet of 33,000 medium tactical vehicle convoy trucks averaging four miles per gallon.
In mid-2014, YAN reported a $2 million round of funding from New Energy Holdings. It received an additional $700,000 in 2015, the same year company CEO Lu Yan announced the formation of a UK subsidiary. In the second quarter, the enterprise plans to launch an A Round to attract about $10 million in investment, Yan says.
Series A/B Stage
Carlsbad, CA-based 5D Robotics received $20,000 for sweeping the A/B Stage category for startups seeking A/B funding and scale and partnership opportunities. The eight-year-old enterprise was cited for providing software, sensors, and ultra-wide-band radio frequency positioning for connected vehicles.
Spun out of the Idaho National Lab, 5D is dedicated to “shaping the future of autonomous vehicles,” noting its “innovative software supports navigation, mapping and localization, search and detection, and dexterous mobile manipulation and various other robot behaviors for unmanned ground and air vehicles.”
The enterprise further indicated its technology “solves position and navigation down to the centimeter level, allowing vehicles to park side by side, indoors, outdoors, and in the snow, fog, or rain.”
5D recently rolled out a commercial module that can easily introduce robotics innovations to forklifts and scissor lifts, among other equipment, thereby automating operations while optimizing safety and efficiency.
In 2016, 5D announced it had raised $5.5 million from private investors in a seed round to accelerate the commercial development of its automation technology in sectors including industrial heavy equipment, mapping, and inspection. “We are happy that much of the round was from a strategic partner and demonstrates the strong level of confidence they have in our automation solutions,” David Bruemmer, CEO and cofounder of 5D, said at the time.
The firm recently partnered with United Rental to implement autonomous equipment driving at select yards.
Winners, all of them.