Ohio HI-Tech Startups

Ohio tech startups are becoming more attractive to outside investors because of the state's access to unique technology and talent, and an active base of "angels"-usually affluent people who put money into startups.

More than $121 million were invested in 124 promising new companies in early stage development in 2006 (39% for IT, communications and software, Medical devices, 21%, 15% for Biopharmaceuticals, and 10% for Health care IT and services).

Though there's been a great amount of company formation in the seed and early stages over the last three years in Ohio, additional investment will be needed past the seed stage, more than $2.1 billion, over the next five to seven years.

Two state-based funds, Ohio Capital (established in 2005), and Third Frontier, focuses on venture capital firms that focus on tech companies. So far, Ohio Capital has given $43.5 million to nine firms, while $115 million was given to Third Frontier for seed investing and entrepreneurial assistance.

These two funds comprise a variety of local county, and state-based tax incentives, grants and low-interest financing-combined with enterprise-zone programs-to offer businesses the opportunity to reduce risks while encouraging investment in Ohio. A few that have benefited are:

Emprya, founded in 1999 by Shanthi Subramanyam (They provide Web-based products that improve the operating systems of companies and agencies by eliminating paperwork, allowing forms to be completed online and be sent automatically to the next user) is a beneficiary: The low cost of operations in the downtown area and access to interns from the local state university also help Emprya attract businesses (including the U.S. federal government and Proctor & Gamble) that otherwise would be sent overseas.

Another Ohio-based business, DRS (Data Recovery Services) has become of the nation's fastest growing tech companies for two consecutive years.

Founded by Mike Meloy, about 40% of the revenues come from consulting-helping businesses design computer networks, phone systems and wireless hookups. The other 40% comes from product sales, such as computer hardware and phone systems, and the operation of two data centers.

DRS has the further distinction of ranking no. 38 on the Fast Growth 100 List of CRN, an industry publication (Within the next two years, company sales have grown annually at 153! From $8.5 million in 2006, DRS expects sales of $12 million this year.)

Recently DRS has expanded their business to Pittsburgh and Akron (These offices employ just eight now, but the company specializes in small and medium-sized firms).

The nation may be headed toward a recession, but Meloy doesn't feel threatened: "No matter what the stock market or economy does, you're going to need technology".

Red-hot up-and-comer Turning Technologies has recently introduced a new receiver that allows presenters to use its audience response system without a projector or computer.

ResponseCardAnywhere is a hand-held receiver with an LCD screen. It's about the size of a deck of playing cards. The company's Turning Point product has a response card that allows users to ask questions or send feedback to a presenter, with results quickly tabulated. It's currently the only system that supports voting-based assessment on such a wide range; it can be used on any Windows (this can make a PowerPoint presentation interactive!) Mac, or Palm-based device, wireless PDA, and mobile phone networks. It comes with full support and maintenance and is compatible with most software and hardware used in schools today.

In 2007, Turning Point won Europe's prestigious BETT award in the primary and secondary hardware category. BETT (British Education and Training Technology) is the most respected international award that educational technology can receive. BETT is also the world's leading international technology event which caters to educational suppliers as well as members of the global teaching and learning community. Turning Point was also used in three BETT keynote speeches.

Turning Technologies was recognized by Entrepreneur Magazine (2007) as the seventh fastest growing small business in the USA. Also in 2007, Inc. Magazine ranked them as no. 1 on the Inc. 500 list as the fastest growing privately held software tech company, and the 18^th fastest growing privately held company overall.

Customers include many Fortune 500 companies, K-12 classrooms, and consulting/training firms.

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