In this episode, we look at health care and travel startups. Who better to look at startups in these industries than Esther Dyson, an angel investor in a number of startups in these areas. This week, we look at Careflash, which has a post-money valuation of $2.9 million, and Yapta, which is estimated by Liquid Scenarios to have a pre-money valuation of $7 million. Careflash is a Web site where people can submit and share information, and offer well-wishes surrounding a loved one's health circumstances. As Esther called it, "It's like TheKnot around a disease event." TheKnot is a wedding registry site. Yapta is a travel concierge site, that wants "to make it easy for you to find the best flight at the right price."
We started with Careflash. Esther, who's invested in a somewhat similar site called PatientsLikeMe, said she likes Careflash because it provides tool for etiquette.
For me, I liked the idea since I'm currently receiving daily email threads with a couple hundred family members regarding my father's kidney transplant. If this dialogue were on Careflash, perhaps we would be able to find like-minded people sharing their stories about kidney transplants. As Esther said, these shared experiences make illnesses and enervating health conditions far "less scary."
Esther also pointed out that pharmaceutical companies – while being an ideal sponsor - may not be so easy to target as advertisers. Pharma is “terrified that their ad is going to appear next to something that says, 'Oh, I used such and such a drug and my temperature went up because then it’s a reportable event for the FDA,'” she said. What would make Esther invest in this company? You’ll have to watch to get that answer.
Also, in our Liquid Scenarios Minute, we do look at the exit scenarios for Careflash, which raised $900,000 for a post-money valuation of $2.9 million.
We then set our sights on Yapta. Esther, who's invested in Tripit and Dopplr, was pretty straightforward when she said that Yapta "smacks of yet another travel site."
The real problem with travel isn't that information isn't automated and easily accessible, she said. Rather the real problems passengers face is getting bumped and not being able to make connections. The real problem with travel isn't that people don't get rebated for when they overpay. It's getting quality service for what they paid. Both Ezra and Esther suggest that Yapta do a deal with Clear, a site that helps people get through airport security faster. Now, that's a nice service solving a real problem.
All three of us agreed that the rebates Yapta is promising to customers is a good gimmick, but not necessarily a big enough incentive to get people to use the service. Finally, we do look at Yapta's exit prospects in the Liquid Scenarios Minute.
In the end, the three of us liked Careflash over Yapta. You'll have to watch for the reasons why.
Founder and CEO of Vator, a media and research firm for entrepreneurs and investors; Managing Director of Vator Health Fund; Co-Founder of Invent Health; Author and award-winning journalist.
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Next time you're on a flight enjoying your honey-roasted peanuts, ponder this: The average flight price fluctuates 400%. In other words, the guy next to you may have paid hundreds of dollars less for his ticket than you paid for yours. How can you avoid paying too much? Use Yapta.
Yapta was created to make it easy for you to find the best flight at the right price. We do this by helping you find flights based on your personal preferences, tracking prices on these trips, and alerting you when prices drop so that you can purchase tickets when they're most affordable.
Even after you purchase your ticket, Yapta continues to track its price. If the price drops below what you paid, and you're eligible for a refund or travel credit from the airline, Yapta can help you claim it.
Yapta was launched in May 2007 and has since helped its members save millions of dollars on airfare. Here are just a few of the people who have been integral to Yapta's success-and your savings:
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CareFlash was founded by Jay Drayer out of an experience he had within his family when a member was diagnosed with a chronic heart disorder. Testifying to how positive transformation can be driven by a tragic event, the experience that motivated Jay to depart his career path in corporate finance surrounded the 9/11 tragedies in which he witnessed the second plane's impact on the World Trade Center while on his way to a 9:00 meeting that morning at 60 Wall St. Jay calls himself a recovering CFO who was inspired to create a service that filled-in the gaps delivering rich features and content, lacking in other providers that offer thinly featured online "care communities". CareFlash is headquartered in Houston.
CareFlash provides patients and their loved ones with a centralized, private, secure web community, featuring plainly narrated 3-D patient education resources, and rich features for engaging help from friends to assist through a health crisis or in eldercare. Features are bundled into an easy-to-use, integrated web community that requires no technical knowledge and can be setup in minutes while accomplishing the following.
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Since founding bpCentral, our focus has been on increasing each user's competitive advantage each and every time they interact with one of our applications. Naturally, this involves more than simply enabling complex calculations to be performed accurately. In fact, during the first 12 months of developing our new technologies and applications, we put an inordinate amount of resources into discovering how to transform the relationships between idiosyncratic decision-makers and financial information. Our premise was that if that human to data relationship could be elevated to a new standard, then the relationships of those professionals with the entities and individuals they interact with could be more efficient and therefore more valuable.
In response, we developed CIMPA, the Carver Import Algorithm, a system that allows any electronic financial information, data or reports to be interpreted by a receiving system without the need for XML, XBRL, tagging approaches or extensive manual data entry. As a result of this technology, the Company's systems for private equity and venture capital professionals are able to import data in a matter of seconds, instead of a matter of hours.
Similarly, the Company noted that when users attempted to calculate the outcomes of complex liquidation preferences, anti-dilution provisions and other complex terms that are common to VC/PE transactions, any output was virtually impossible to verify without a costly audit of the formulas. Since the formulas were generally based in excel, this meant that few if any partners or other key investment professionals could afford to expend the effort to verify how amounts were arrived at. Upon further consideration, the Company realized that, to a certain extent, this was true of all financial reports. For traditional financial statements, this point is evidenced in the fact that notes to financial statements typically occupy several times more pages than the actual financial reports do. This realization inspired the Company to develop a system it calls OferX, which presents all financial information in a manner that allows any user to audit and see how amounts were calculated (in an easy to understand, quantifiable manner) without the need for extensive textual descriptions.
Together these unique tools form the foundation for the Company's offerings, which are backed by over 29 patent pending technologies.