Think Big Partners

Startups Gain 20 to 50 Percent More “Runway” with Cloud Services Platform

Business Needs

Entrepreneurship is a gamble because it leaves so much to chance. Herb Sih wants to change that.

“Consider the entrepreneur,” says Sih, Managing Partner at Think Big Partners in Kansas City, Missouri. “Even if he or she is located in a funding hub for startups, like New York or San Francisco, it’s difficult to get the attention of qualified investors; if the entrepreneur is located far from those hubs, it can be nearly impossible. Many funding meetings prove unproductive. And seeking funds takes time away from the entrepreneur’s primary job of launching a business.”

Meanwhile, the picture can be equally bleak for investors, who often find it difficult to identify high-potential startups. Too much money in the system chasing too few good ideas drives up costs. Too many entrepreneurs lack the insight and experience that investors seek; too many funding meetings become a waste of time.

Sih and his colleagues wanted to create an online matchmaking service that would help startups and funders find and evaluate each other faster and more effectively, form successful relationships, and get valuable ideas funded quickly, fairly, and smoothly.

To do so, Think Big Partners created a startup of its own, PitchCastr. While Sih and his partners are better connected than the average entrepreneurs, they still had many of the same concerns as those entrepreneurs, including the desire to minimize costs and get to market as quickly as possible.

Solution

Think Big Partners didn’t want to support PitchCastr’s infrastructure on-premises or at a hosting location, which would still have left it responsible for server operations. It considered cloud-computing options, but found Amazon Web Services difficult to understand and lacking the out-of-the-box features it wanted. Google—a major presence in Kansas City—didn’t offer a comparable service.

The money that startups save with Windows Azure and BizSpark can stretch their six-to-nine months of capital out by another two or three months.

– Herb Sih
Managing Partner, Think Big Partners

Instead, Think Big Partners decided to build PitchCastr on Windows Azure. It also adopted Windows Azure for the accelerator’s internal operations, and now encourages its client startups to do so as well.

As a startup, PitchCastr qualified for the Microsoft BizSpark Plus program, from which it gained up to US$60,000 worth of access to Microsoft tools, technologies, and services during its first year, including Windows Azure, Microsoft Visual Studio, MSDN Universal, Windows, Microsoft Office, and more. PitchCastr also received specific support and marketing services at no charge. Meanwhile, as a startup accelerator, Think Big Partners qualified as a Microsoft BizSpark Plus Partner, which enables it to offer BizSpark membership and benefits to the startups it mentors.

PitchCastr uses Windows Azure in several ways. Investors and entrepreneurs enter profile information into a Windows Azure-hosted database, which also hosts the entrepreneurs’ video pitches and business plans. Business logic running in Windows Azure analyzes investor responses to the pitches. When warranted, PitchCastr sponsors a live, interactive meeting between the entrepreneur and investors.

Think Big Partners uses about seven instances of Windows Azure to support PitchCastr, its own projects, and the needs of its client startups. It uses Windows Azure Virtual Machines to increase the reliability of the public-facing websites. It also uses Windows Azure as a development platform; Windows Azure Mobile Services, for example, help develop Windows Phone apps.

Benefits

“Windows Azure is phenomenal,” says Sih. “It just works. It removes headaches and gives us peace of mind.”

Saves $200,000 in First-Year Costs
Think Big Partners wanted a powerful infrastructure without paying a high-powered price. With Windows Azure, it avoids the approximately $100,000 a year that it would otherwise pay to a database or systems administrator to manage an on-premises system, plus another $100,000 for hardware and software—an expense that would likely be repeated on a three-year replacement/upgrade cycle.

PitchCastr, Think Big Partners, and the accelerator’s participating startups also avoid the cost of the Microsoft tools and technologies they obtain through BizSpark and BizSpark Plus.

“$100,000 or more per year is a significant sum for any small company,” says Sih. “The money you save with Windows Azure and BizSpark can be a big factor in meeting payroll when you’re ramping up a new company.”

Stretches Startup Capital by 20 to 50 Percent
Sih estimates that Think Big Partners saves between 10 and 20 hours per startup per month that it would otherwise need to provide technical support to the companies in its accelerator program. That time translates into additional capital that can be invested in startups.

“The money that startups save with Windows Azure and BizSpark can stretch their six-to-nine months of capital out by another two or three months,” Sih says. “That’s another 20 to 50 percent of runway before more funding is needed. And that can be the difference between being funded and being out of business.”

Reduces Time-to-Market by 20 Percent
Think Big Partners also uses Windows Azure to accelerate its software development efforts, while increasing quality and reducing cost.

“Windows Azure has fundamentally changed the way we think about, and develop, software,” says Sih. “Instead of starting on a development box, we start on Windows Azure and tap the services it provides. And deployment is a nonissue because the software is already in the cloud.”

For a recent mobile app, the company went from development to production in 36 hours—compared to the two weeks that Sih estimates it would have taken otherwise, a time savings of 85 percent. For PitchCastr, the company reduced its time-to-market by about 20 percent.

Source:

Microsoft Case Study: Think Big Partners