With the Covid-era days of funding a plenty long gone, 2023 marked a tough year for many startups across the country.
Some banks and venture capital firms failed, companies laid off staff and businesses shut down. Yet, the environment meant the positive standouts shone all the brighter.
That’s why as we start 2024, Buffalo Inno is featuring five startups to watch this year. They’re a symbol of the potential good news ahead for the local startup community, as the relatively small yet mighty ecosystem continues to grow and forge ahead.
For instance, last year’s startups to watch included Azuna, which landed a strategic partnership with the Buffalo Bills, and AireXpert, which raised $3 million and landed customers like United Airlines.
Here are our picks for 2024.
LenderLogix
CEO: Patrick O'Brien
LenderLogix is in growth mode, and it hasn’t overly relied on venture capital funding to get there.
Since its founding in 2016, the company, which provides digital tools for point-of-sale and automation for credit unions, banks, independent mortgage banks and brokers, has taken a “pretty conservative approach to fundraising,” according to CEO Patrick O’Brien.
The startup last year received a $500,000 investment from the Western New York Impact Investment Fund to accelerate the development of CRA Analytics, a platform that uses home-buying incentives and demographic information in each census tract across the country. The goal is to drive investments in low-income neighborhoods.
That’s the only outside investment the startup has taken besides some early angel funding.
LenderLogix, which employs about 15, has more than 100 financial institutions as customers, according to O’Brien, a former M&T mortgage officer. With upward of 10,000 lending institutions across the country, he sees opportunities for adding customers and products. Since the startup began, it has brought new products to market about every 18 months.
Offerwell
CEO: Simon Mahfoud
Since launching in May 2023, Offerwell has been busy.
The startup, which has created an online real estate platform to help agents submit, accept and manage offers, has gotten hundreds of real estate agents in Western New York on the platform. The business, as of mid-December, was on its way to closing a $500,000 pre-seed round, with notable investors like the University at Buffalo Cultivator program; Dan Magnuszewski, co-founder of ACV Auctions; and Mark Longo, president and CEO of Block Longo LaMarca & Brzezinski PC, a Buffalo real estate law firm.
The funds will help develop user products and experiences and support plans to enter the Rochester and Syracuse markets. The business also expects to add new features to the platform this year.
And they’ve got the background to do it: CRO Nick Giambra, who has sold real estate in Western New York for the last 11 years, currently leads a real estate sales team of 15 at Keller Williams Realty WNY.
Mahfoud built his first website when he was 12 to help his family track expenses. He has over a decade of software development experience and spent five years at a stock exchange group.
CleanFiber
CEO: Jon Strimling
CleanFiber has the demand and now, it’s also got the funds to fuel its expansion.
The business, which manufactures building insulation from recycled corrugated cardboard, raised last year $6.7 million in debt financing and equity, which will go toward expanding the company’s production capacity. The work includes completing the startup’s $16 million capacity expansion project at its factory in Blasdell.
The physical expansion, which added 6,000 square feet for a grand total of 67,000 square feet, has already been completed. As of June 2023, the business was installing equipment and expected to be operating at full capacity with the expansion by mid-2024.
The startup has doubled its originally intended revenue capacity for the expansion project and got the financial support to carry out that plan, according to CEO Jon Strimling in June.
When it comes to revenue run rates, CleanFiber has grown by about 2.4 times in 2022 compared to the year prior and, through the first half of 2023, grew about 2.5 times year-to-date.
SelectFI
Founder: Tom Vullo
Although SelectFI just launched in 2023, its executive team has decades of experience in various industries.
The Buffalo-based software company for auto dealerships has already raised nearly $2.6 million as part of alarger pre-seed round, targeting $3.5 million. The business expects to meet that goal early this year.
The startup’s software platform is an auto dealership regulatory compliance and financing pre-qualification tool that aims to help dealerships help customers with financing quickly, more accurately and in greater compliance with Federal Trade Commission fair lending practices.
The executive team includes:
- Founder Tom Vullo, who has been in the auto industry for over a decade;
- CFO Matthew Dorn, who was a CPA for several years and spent the last decade developing power plants with different partners, which included acting as CFO and raising funds;
- COO Drew Dorn, an engineer who had a tech-enabled smart grid energy business that he sold to a private equity fund and a participant in the power plant development with Matt;
- CMO Chris Laczi, previously vice president of marketing at Life Storage, his employer for the last 25 years.
As of October, the startup, which employs 16, had eight customers on its platform and aimed to grow to 50 to 100 clients within the next 12 months.
Kredit Academy
CEO: Evan Leaphart
Kredit Academy got two wins at the 2023 43North Finals in October. The financial literacy platform took home a $1 million prize along with the $25,000 People’s Choice Award, based on audience votes.
The comprehensive financial literacy platform gives customers, particularly young adults and teens, white-label, credit-based solutions to provide information and tools to build sound credit, as well as giving financial institutions a way to grow and engage.
As part of winning the $1 million prize, the startup will move early this year from Miami to Buffalo. The business hopes to tap into the $43 billion that M&T Bank committed to support underserved populations, small businesses and communities of color.
The startup in late 2023 also won $18,000 in the Culture Shift Labs pitch contest in Miami and finished earlier in the year the Tampa Bay Wave accelerator program. The business in November was accepted into the ACT House Accelerator program.
