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A decade ago, when the Wharton Business Plan Competition (BPC) began, the Internet dominated discussions about entrepreneurship. That, of course, was before the bubble burst and many dot.coms were revealed to be, in the words of New Yorker writer John Cassidy, little more than dot.cons.
These days, the Internet remains a critical enabler of commerce, but no one pretends that staking out a little real estate on the web will ensure business success. Instead, student entrepreneurs who compete in the Wharton BPC have recently turned their attention to another promising arena — healthcare, specifically biotechnology, that combination of medicine, basic science and engineering that has unraveled the human genome and, if it lives up to its promise, could deliver a raft of new treatments for a variety of diseases.
Five of the eight finalists at this year’s Venture Finals — the culminating event in the yearlong business plan competition — offered up ideas for businesses that could help people live longer or less painful lives. They ranged from one as simple as creating better padding for the junctures between prostheses and amputees’ residual limbs to one as complex as using nanoparticles — infinitesimally small specks of matter — to better diagnose and treat cancer.
Other health-related ideas included a gel that would replace damaged knee cartilage, a drug to prevent a common form of blindness, processes for embedding pipes with bacteria killers, and a medical device to stop tumor growth. Rounding out this year’s finalists were software that would aid in patent applications and a process for tinting windows with a pulse of electricity.
The Wharton BPC, open to any team that includes a University of Pennsylvania student, lasts much of the academic year. In the fall, hundreds of teams present briefs of business ideas. By the late spring, that group is winnowed down to 25 semi-finalists, who prepare full-fledged business plans. The eight finalists are selected based on the plans. At the Venture Finals on April 30, a panel of four judges evaluated the finalists, listening to a 10-minute presentation from each and then subjecting each to 10 minutes of interrogation. The judges, all investment professionals and Wharton alumni, came from Cardinal Partners, Weston Presidio, Schering-Plough and Felicis Ventures.
The competition is managed annually by Wharton Entrepreneurial Programs. It awards cash prices — including $20,000 for first place — to the top three finishers, plus donations of business advice from lawyers and accountants.
Below, in alphabetical order, are summaries of the business ideas proposed by this year’s eight finalists. See if you can guess the winner, revealed at the end of the article. (No peeking.)
Creative Film. Imagine car or airplane windows that could change from clear to tinted with a pulse of electricity. What about home or office windows that wouldn’t need blinds to block out the sun or prying eyes? Here, too, a little flash of electricity would change them from see-through to opaque. That’s the promise of Creative Film, which would make its “electro-optical” film using liquid-crystal technology. Despite its magical sounding properties, the film wouldn’t cost much to make and wouldn’t need much electricity to operate, according to team leader Liuwen Duan, a Wharton MBA student.
In fact, the film doesn’t need any electricity to maintain its opacity. The initial pulse acts as a switch, and the film will then remain in a particular state — clear or opaque — until it’s zapped again. High-end products like Boeing’s Dreamliner jets and Maybach’s luxury cars employ competing, but much more expensive, technologies in their windows. Creative Film would democratize the niche, bringing electro-optical film to the masses. The team aims to take its technology first to the auto industry, where it could be used with windshields, windows and sunroofs.
Gelomatrix. Baby Boomers are falling apart, and that presents an enormous opportunity for Gelomatrix. Specifically, Boomers and, for that matter, their athletic kids and older parents are ripping the cartilage in their knees. When they do, they face a tough choice: Either they can stop engaging in knee-imperiling sports like running and skiing or they can opt for cartilage-replacement surgery, with a long recovery and no guarantee of success. Gelomatrix would make a gel that would replace conventional artificial cartilage. “What’s important to people who tear their cartilage is minimally invasive surgery, a speedy recovery and a return to an active lifestyle,” said team leader Wee Siong Goh.
Gelomatrix’s gel could provide all of that. Once injected in the knee joint in liquid form, it would be hardened with ultraviolet light. The recovery time would likely be three to four months vs. the year or more that conventional surgery requires. Gelomatrix’s underlying technology sprang from the lab of Jason Burdick, a Penn professor of bioengineering.
Innova Materials. Alex Mittal and Priyanka Agarwal returned from Honduras convinced that their efforts in that country might have been inadequate. They had helped to build a village water system but realized that while the system could ensure that the townspeople received water, it couldn’t ensure that the water would be potable. So the two engineering students began to consider ways to come up with a permanent anti-microbial treatment for the inside of plastic pipes. They teamed up with several classmates to create a process for cheaply embedding beneficial materials in plastics. Enter Innova Materials.
Team member Arjun Srinivas compared Innova’s process to “throwing chocolate chips at cookie dough.” The process, called Innlay, can embed many sorts of things, including tiny fragrance packets and even biosensors. To prove the product’s practicality, Innova is making plans to manufacture anti-microbial water bottles and other items for hydration packs.
iTherapeutics. About one in five people older than 65 has some level of macular degeneration — an eye disease that gradually blots out people’s central vision and, if untreated, eventually blinds them. Macular degeneration causes permanent scarring at the back of the eye, so it’s irreversible. To save patients’ vision, it must be stopped early. iTherapeutics has devised a drug that would halt macular degeneration by focusing in on a critical gene via a recently discovered biological process.
“Current therapies target a gene that’s downstream from the one we’re targeting,” said team leader Rich Viens, a Wharton MBA candidate. To prevent the gene from causing blindness, iTherapeutics’ drug would harness a biological mechanism called RNA interference, also known as RNAi or gene silencing. (Two American scientists won the Nobel Prize in 2006 for their discovery of RNAi.) By manipulating the natural RNAi process, researchers can, in effect, turn genes off. iTherapeutics’ drug aims to do that with one of the genes involved in macular degeneration.
Proteza. Prostheses seem a simple miracle. They allow people who lose their lower legs to walk. But they come with costs, often causing pain and even pressure sores for their users. Proteza’s SmartSock would make prostheses more comfortable and their users’ lives more pleasant. According to team leader Chrysta Irolla, “55% of prosthetic users in the U.S. experience pain and discomfort daily.”
The SmartSock has three parts: a padded, sweat-wicking sock to cover the end of the amputee’s limb; a pressure sensor, and a microprocessor. The sensor and the microprocessor work together to vary the volume of the sock, made of polyurethane, ensuring a constant snug fit. “The goal is to create comfort and mobility for people experiencing pain daily,” she said. The plight of prosthetic users is likely to become more common in the United States in coming years as wounded soldiers return from Iraq, the country’s population ages and the number of American diabetics increases, Irolla noted. (People are often afflicted with diabetes as they age, and diabetics can lose limbs because of circulation problems.)
Sextant IP. Patents are gold. Having one, or a portfolio of them, can be the difference between a booming business and constant worry about whether competitors are going to copy your products. But getting patents costs lots of money and takes significant time. Sextant IP aims to make the process easier and quicker. Its software “cuts the user’s [patent research] time by 50%,” said team leader Han Shen, an MBA candidate. “That translates into great savings.”
Numerous software tools help with searching patent databases, but they don’t mine the data to allow for the focused identification of similar or competing technologies, he said. Sextant’s data-mining eliminates the most common bottleneck in patent analysis, which is the massive data dump that results when a lawyer or inventor does the early searches. “Sextant brings a bundle of tools to accelerate the process,” Shen added.
Solixia. Solixia’s HotDot nanoparticle — an unimaginably small cluster of radioactive atoms — would allow pinpoint delivery of radioactivity to tumors. That, in turn, would permit “greater tumor uptake and better detection,” said team member Brian Smith. Solixia would commercialize discoveries that Smith, who has a doctorate in materials science, made while working as a researcher at Penn and at Philadelphia’s Fox Chase Cancer Center.
Solixia’s first imaging agents would help oncologists treat breast and ovarian tumors, but the underlying HotDot technology could apply to a host of cancers. And its radioactivity could be detected via existing equipment like CT scanners, making it relatively easy to introduce to the market. “We deliver a 10 times higher payload of radioactive material to the breast tumor [than competing methods],” Smith noted. “With a cluster of atoms, you keep the size down. Small things can better penetrate tumors.”
Ultrasonic. Chemotherapy kills tumors by poisoning them. Ultrasonic wants to starve them. Its medical device would use low-frequency ultrasound to disrupt tumor blood vessels without harming the surrounding normal vessels. With Ultrasonic’s treatment, microbubbles would be injected into a patient’s bloodstream. Once the bubbles reached the tumor, the ultrasound would heat them and thus decrease blood flow. A study showed that, in mice, it could cut tumor blood flow by 82%.
“We’re eliminating the support structure for the tumor,” said team member Darshan Prabhu. “We don’t cause damage to normal vessels because they are not as fragile.” The technology originated in the lab of Chandra Sehgal, a Penn professor of radiology. Ultrasonic initially would treat liver cancer because those tumors are close to the skin and rich in blood supply, making them ideal targets for its technology. “There’s no competing therapy that’s very effective, so it’s a significant unmet need,” Prabhu added.
Turning a Plan into Reality
And the winner of the 2008 Venture Finals is … Solixia. Smith, the inventor of the technology, and teammate Irene Susantio collected $20,000 cash plus donated services for their victory. Both are second-year MBA students who intend to pursue Solixia full-time once they graduate. “Winning the Business Plan Competition gives us the opportunity to sell our business idea to seed financiers,” Susantio said.
Although they are classmates, Smith and Susantio connected through Smith’s brother-in-law, who is an intellectual property attorney in Philadelphia. Susantio, a chemical engineer who had worked for ExxonMobil before coming to Wharton, had met Smith’s brother-in-law thanks to her interest in entrepreneurship. They have already incorporated Solixia and intend to base their business in Philadelphia. They are currently enrolled in the Wharton Venture Initiation Program, the school’s incubator for student-led startups.
Second place went to Innova Materials and its process for embedding beneficial materials in plastic. The members of the Innova team received $10,000 as well as donated services. They also won the Frederick H. Gloeckner Award for the best undergraduate-led team, which came with $5,000, and the People’s Choice Award, which came with $3,000. Like Smith and Susantio, several of the Innova team members intend to turn their idea into a viable venture.
The People’s Choice Award debuted this year and helped to mark the 10th anniversary of the Business Plan Competition. After the finals, each of the eight teams gave a two-minute elevator pitch for their ideas. While the Venture Finals judges considered their decisions, several hundred audience members listened to the pitches and then voted to determine the winner.
Finishing third in the overall competition was Proteza, with its SmartSock for amputees. Proteza received $5,000 in cash as well as donated services. After graduation, Irolla, a senior bioengineering major, plans to attend graduate school at Northwestern University’s prosthetics program. “I’ll be working in a lab in the Rehabilitation Institute of Chicago,” she said. After that, she, too, hopes to turn her business plan into a going concern.