Chicago-based biotech company HappiLabs is the latest local startup to participate in Y Combinator, a selective accelerator program in Silicon Valley that has helped launch high-profile tech companies like Airbnb and Reddit.
This summer’s program, which began in June, culminated on Aug. 21 with a demo day, where participating startups pitched their companies to investors. Founded in 2005, YC is a seed accelerator program that has invested in more than 1,900 startups, according to its website. Other Chicago-based startups that have participated in it include ShipBob, Tovala and Popular Pays.
HappiLabs founder and CEO Tom Ruginis said the startup landed $120,000 from YC and is now negotiating other deals with the investors it pitched to on demo day, aiming to raise about $1 million. The funding is the first outside capital HappiLabs has taken since it launched in 2012.
“A lot of my time at YC was spent using the mentors and advisors they have there to better understand what’s possible now and what’s possible in the next three to 12 months,” Ruginis said. “A lot of my time was spent getting a better handle on what the vision needs to become.”
HappiLabs makes a management and marketplace platform that reduces the cost of lab supplies for scientists in academic and biotech labs. Based on pricing data the startup collects, it purchases supplies and equipment on behalf of its clients for the lowest prices possible. Supplies on the platform range from nitrile gloves to chemicals and microscopes.
The startup manages more than 28 labs, encompassing over 350 scientists at academic institutions like the University of Illinois, as well as at other startups, including Notable Labs and Clara Foods. And with more than 2,000 labs across the country, Ruginis says the startup has tremendous potential to grow. So far, HappiLabs has depended on word-of-mouth to grow and has not paid for any traditional marketing.
Clients pay for HappiLabs’ services through a monthly subscription and the cost varies for each client depending on the size of their lab, Ruginis said.
He came up with the idea for HappiLabs after getting to know the industry while working in molecular biology and medical supply sales roles. Now years later after bootstrapping the startup, Ruginis said he applied to YC to help accelerate growth and get guidance on how to improve its tech offerings.
With the additional knowledge and funding from YC, Ruginis wants to focus on hiring a full-time chief technology officer and a team of developers. The company has so far been outsourcing technical work.
“We’re going to make sure we can afford a CTO that’s a rockstar,” Ruginis said. “We got to start bringing this in-house. It’s the most efficient way to do it.”
Currently, the startup only has 14 employees, one of which is Ruginis’ wife, Rachel, who financially supported him while he launched the company. Rachel now serves as a data analyst and creative director for HappiLabs.
After participating in YC, some startups relocate their operations to Silicon Valley to be near the investors that have cut them checks. But Ruginis said he has no plans to move HappiLabs’ headquarters to the Valley, though the startup does have an office there.
“HappiLabs HQ will always be in Chicago,” Ruginis said. “I love the city. It’s where I grew up.”
