By 9:30 AM, every seat was claimed at New York City’s Webster Hall. But the vibe at this year’s TechStars Demo Day felt different.
Despite cheers from supportive founders from the rafters as each startup in the accelerator took the stage, investors and press remained wary.
Part of the scepticism comes from last week’s sudden departure of Eugene Chung, the man who was hired to coach eleven startups through Demo Day. The only reason given for his firing: “He wasn’t a fit.”
But a thicker fog has engulfed the tech community lately as air hisses out of the hype bubble investors and press helped create over the past few years. Startups that received massive fundraises and valuations have taken turns for the worst. Even larger companies like Facebook and Apple are getting heat, and it’s all trickling down, poisening the startup ecosystem. Enthusiasm for new companies has been replaced by scepticism, and it may be hitting accelerator programs like TechStars worst of all.
“How will that company compete against Baby centre?” one whispered as a shopping experience for mums, WeeSpring, presented to the crowd.
“I bet he practiced that line a hundred times,” another said after FaithStreet, a social network for chruches, opened with a joke.
The bright spot in the morning was AdYapper, a startup that seemed break through the cold of the crowd.
Elliot Hirsch, founder and CEO of AdYapper, was introduced by CollegeHumor’s founder, who mentioned his company was doing a “deep test” with the startup. He described the startup’s concept as not sexy, but the fact that CollegeHumor’s advertisers love it “very sexy.”
AdYapper entered TechStars with no clients and no revenue in April. Its mission was vague: “Talk back to any ad in the world, influence brands, and make a real difference.”
Now AdYapper has positioned itself as a way to help advertisers minimize waste in their online spends. Hirsch described one of his current clients, which spends $4 million annually on digital advertising. AdYapper, which adds a snippet of code to each banner and trails campaigns across the Internet, was able to show the client that 70% of their ads were never seen by anyone.
Another AdYapper client, Hirsch says, “had no idea they were advertising on over 100,000 sites” and 30% of their ads were being glossed over. In addition, the client was hitting the exact same person more than 20 times even though their ads were only effective the first one to seven times they were viewed.
AdYapper displays all of the findings in beautiful, easy to consume charts that show where an advertiser’s digital waste is, and it offers recommendations for how to better spend their money and in which markets.
Hirsch says his company started TechStars tracking no ad impressions at all. Today it tracks more than 700 million ads and while it only has two clients, it’s already generating $10,000 per month, up from zero in April.
There are still more presentations to go at Demo Day today. But it’s going to take a geniunely good startup to impress the tough crowd.
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