Another Texas VC

I am exhausted!

I just spent last weekend working with the team at DFJ Mercury to select the $100,000 DFJ Mercury Tech Transfer investment prize at the Rice University Business Plan Competition (RBPC). RBPC is the richest biz plan competition in the world, with over $800,000 in prizes going to students from over 40 top notch universities around the world.

The DFJ Mercury award isn’t your typical biz plan competition prize. It comes in the form of a term sheet proposal. A prize winning team has to stand up to the same standards as any other potential investment. Needless to say, we were very busy during the competition.

Before the competition began our team and advisors spent over 250 hours combing through over 300 business plan applicants. We then took a closer look at the 42 startups that were accepted into the competition. We talked to university tech transfer offices, startup advisors, and even traveled to meet a few teams.

When the competition finally kicked off on Thursday we had 7 individuals from the DFJ Mercury team cover every semi-final flight on Friday. We then invited our favorite firms to a room provided by the Rice Alliance so that we personally meet the teams and go even deeper into their companies.

After the meetings we sat around a table and discussed the pros and cons of each potential investment. We were so impressed by what we saw that at one point we contemplated the possibility of handing out multiple term sheets! We left the competition that night with diligence homework assignments.

Between Friday night and Saturday afternoon we put the DFJ global network to work, getting feedback on technical concepts, customer markets, and other intelligence. We also put together due diligence dossiers on our most likely companies; including their plans, our IP reviews, and our thoughts on their financial projections. On Saturday morning we also talked to the final set of teams to confirm our valuation drivers and ensure that we held a common vision for their futures. Saying we were busy would be quite the understatement with multiple meetings occurring in parallel.

With all of the information on the table, our team spent a final session on Saturday afternoon hashing through the possibilities. At one point during the discussion a reporter from CNN wanted to interview a DFJ Mercury team member, but we were so engaged that nobody wanted to leave. Ned took one for the team but ran back as fast as he could. We made our final decision based on whether the company fit in our capital efficient investment model, was currently fundraising, and could drive a significant amount of value with a small seed investment.

To be honest, the decision was much harder than any of us anticipated because of the quality of the contestants. Multiple teams could have and still can be great additions to our portfolio. We didn’t make a final decision on our winner until 5PM, with the awards gala beginning at 6! Ned didn’t have enough time to go home and had to swing by his office to change into his dinner suit!

After three non-stop days I really enjoyed celebrating with DFJ Mercury award winning team Tendix (Johns Hopkins) at the Gingerman in Rice Village. As hard as it was to believe, I feel like our last 3 days were almost as stressful as theirs! Congratulations to Tendix and all of the other competitors in this year’s RBPC.