The MIT $100K Entrepreneurship Competition is as much a phenomenon as many of the companies it has launched. When the nation's preeminent business plan competition began in 1989, 54 teams competed for $10K. Sixteen years later, the stakes have increased tenfold.
This year, judges will award $100K in prizes — the largest pot in the contest's history. In addition to the traditional MIT Business Venture Prize, the competition has introduced a new Social Impact Prize for teams focused on improving low-income communities. Both winning teams will earn a $50K prize at the awards ceremony on May 18.
With 164 entries, the 2006 competition has attracted the greatest number of contestants since the peak of the dot-com bubble and double the number last year, say contest organizers.
As always, the companies — all created by students — represent a broad range of disciplines and capabilities. In the Social Impact category, semifinalists include Disaster Relief Dwellings (DRD), which proposes high quality, low-cost, quick-build polypropylene housing units now being tested in the flood-ravaged Philippines.
Two start-ups present alternatives to traditional vaccination procedures. OneWorld Medical Devices is introducing a portable, temperature-controlled storage unit for vaccines called a Vaccine Pac. The fully functioning prototype is creating a buzz in the social development world and is being promoted to United Nations agencies, NGOs, and aid organizations.
AeroVax has also developed a method for bringing vaccines to the underserved around the world. The team's safe, portable device delivers vaccines in aerosol form, eliminating the need for syringes, needles, and electricity. The start-up aims to reduce the 40 million cases of measles that plague the world annually.
Among the semifinalists in the Business Venture category, more than a third are biotech devices offering significant advances in chemotherapy delivery, catheter technology, and spinal cord injury treatment. Other student entrepreneurs are offering Internet innovations, energy-saving solutions, and transportation advances.
In the transportation category, Terrafugia proposes to fuel a revolution in commuting with the Transition Personal Air Vehicle (PAV). As the team reports, the multi-functional PAV can drive on any surface, take to the air from most airports, and park in the family garage.
“In addition to increasing personal freedom and mobility,” the team's business plan states, “the Transition will be the most economical form of transportation for trips between 100 and 500 miles.”
Since the contest's inception, more than 85 MIT $50K teams have launched companies with a value in excess of $7 billion. When 1998 finalist Akamai Technologies, a company that has revolutionized e-business technology, went public the very next year, it made the record books with the fourth largest run up in stock price on the day of its IPO.
Akamai is a prime example of the competition's depth of talent and shining proof that you don't have to be a competition winner to succeed.
But winning doesn't hurt. Two teams beat Akamai to the prize in 1998. Judges were deadlocked over which business plan was the more promising. In an unprecedented move, they awarded both teams the top prize, thanks to an eleventh hour contribution by an anonymous donor.
The first of those two companies, Community Connection, an Internet-based clearinghouse that matched volunteers and nonprofit organizations, has since been acquired by United Way.
The other winner, Direct Hit, which ranked websites according to the amount of traffic and the length of visits, was exactly that — a direct hit. The start-up's student entrepreneurs turned down their share of the MIT prize, donating their winnings to the other finalists after receiving an offer for $1.3 million in venture capital funding. Just two years after Direct's win at the MIT $50K, Ask Jeeves bought the start-up for more than $500 million.