Startups to watch

Despite a somewhat tumultuous 2022, Greater Philadelphia’s startup ecosystem has continued to flourish.

This past year, startups and their founders adapted after a record-setting 2021 that saw the region post its largest annual funding total to date. The first half of 2022 was almost equally robust, riding the momentum of the year prior and even notching the most funding raised in a single quarter at $2.7 billion in 2Q. But the second half of the year saw funding subside with the onset of economic headwinds in the third quarter, when the region recorded its lowest fundraising total since 3Q 2020.

Despite the economic downturn, a number of local startups pulled in large investments and still more have ambitious growth plans in 2023.

In PHL Inno’s second annual Startups to Watch, we take a look at the region’s groundbreaking and headline-making startups that we expect to stand out in the year ahead.

Each of this year’s 13 companies were selected by the Inno editorial team, taking into consideration funding raised in the last two years, recent growth, as well as future growth projections and fundraising plans. The list is a mix of early and growth-stage startups.

Here are PHL Inno’s Startups to Watch in 2023.

Capstan Therapeutics

Founded: 2021

Founders: Dr. Drew Weissman, Dr. Carl June, Dr. Bruce Levine, Hamideh Parhiz, Dr. Steven Albelda, Ellen Puré, Dr. Jonathan Epstein and Haig Aghajanian

Headquarters: Philadelphia and San Diego

This University of Pennsylvania spinout, which features an all-star lineup of founders, exited stealth mode in September loaded with an impressive amount of funding. Capstan raised $63 million in seed funding in November 2021, and followed that up with a $102 million Series A in September in a round led by Pfizer Ventures.

The cell therapy company is looking to develop a new type of CAR therapy that incorporates mRNA. Through the in vivo — meaning in the body — cell therapy, it hopes to be able to provide new treatment options in a number of different areas including oncology, fibrosis, inflammation-related diseases and monogenic blood disorders.

Several of the company’s founders are Penn’s leading cell therapy and mRNA scientists.

CollX

Year founded: 2021

Founders: Ted Mann and Kostas Nasis

Headquarters: Haddonfield, New Jersey

CollX, like its users, has its sights set on big-time deals in the year ahead. The app allows users to scan their sports trading cards and, using AI technology, search a database of millions of cards to tell users how much theirs is worth.

The company launched last January and has since added a “Deals” feature that gives users a platform to buy, sell and trade cards, for which the company started collecting a commission in December.

CollX has amassed over 400,000 active users and projects that figure to be in the millions in 2023, which will get the young startup closer to profitability.

In addition, Founder Ted Mann, who exited his coupon startup SnipSnap in 2015, said he is in “heavy talks” with big players in the trading card space for partnerships and licensing deals that will add other revenue streams in 2023.

So far CollX has raised $1.5 million from angel investors and added another $250,000 at the Lion’s Den pitch competition during the Philadelphia Alliance for Capital and Technologies’ 2022 Capital Conference in November. CollX is looking to raise a seed round in the first quarter of this year.

Fort Robotics

Founded: 2018

Founder: Samuel Reeves

Headquarters: Philadelphia

Founded by Wharton School alum Samuel Reeves, Fort Robotics uses robotic technology to ensure safety across automated machinery through wireless emergency stops, remote controls and network products.

Located in the Rittenhouse Square neighborhood, the startup recently raised a $25 million Series B round led by Tiger Global. Prior to that, it raised a $13 million round that included participation by Mark Cuban, owner of the NBA’s Dallas Mavericks and a celebrity investor on the hit ABC series “Shark Tank.”

Since the fresh Series B funding in July, Fort has increased its headcount 52% from 52 to 79, including the addition of a number of new executive roles. The Philadelphia company added vice presidents of technology, product and finance, and operations.

Its clients include dozens of Fortune 1000-size companies in industries like warehousing, construction, agriculture and transportation.

Fort Robotics is now ramping up to launch its Fort Pro Series, which has new security features and an upgraded version of its Safe Remote Control product. The new line is expected to launch mid-January.

Lluna

Founded: 2019

Founders: Jess Podgajny and Aaron Kamholtz

Headquarters: Philadelphia

Fresh out of the Comcast Lift Labs Accelerator, Lluna is readying to assert itself in the changing world of human resources.

The digital HR platform helps work teams adapt and build connections in remote and hybrid environments, which are becoming increasingly common. To do so, the tech company creates personal profiles based on the work preferences of each member of a team in order to make work more efficient.

Coming out of the accelerator, co-founders Jess Podgajny and Aaron Kamholtz said they are tripling their customer base. Lluna launched to 42 new companies, adding 1,000 customers in a range of industries including professional services, technology, biotech, and pharmaceuticals.

In addition to expanding, Lluna also snagged 12 four-month pilots across the Comcast, NBCUniversal and Sky network of companies. Podgajny and Kamholtz hope to convert those pilots into annual subscribers.

NeuroFlow

Founded: 2017

Founders: Christopher Molaro and Adam Pardes

Headquarters: Philadelphia

When you bring in funding without having to ask for it, you can be sure investors believe in your company. That’s what happened for NeuroFlow, the mental health startup that most recently raised an untargeted $25 million growth round on the heels of its $20 million Series B.

Founded by Christopher Molaro and Adam Pardes, NeuroFlow’s platform tracks users’ moods, pain levels and sleep through self-assessment. Health care providers can then use those assessments to identify behavioral health conditions and integrate it into a care plan. The goal is to help patients connect with the right level of care with the intention of ultimately lowering costs associated with mental health treatments.

The startup previously collaborated with the Independence Blue Cross Foundation and Trinity Health Mid-Atlantic to support the mental wellness of frontline health care workers amid the Covid-19 pandemic.

NeuroFlow has raised $57 million to date, moved into a 16,000-square-foot office at 1601 Market St. in the fall and has doubled its headcount over the past year to about 100.

Pardes, the company’s COO, said that the goal now is to “go from startup to scale-up.”

REC Philly

Founded: 2014

Founders: Will Toms and Dave Silver

Headquarters: Philadelphia

This Center City creative services startup is looking to give creators and entertainers a space to grow — and one big-name entertainer has already bought in.

After receiving a $2 million investment from rapper Sean “Diddy” Combs in 2022, REC Philly is expanding to Miami this year with a 12,000-square-foot space.

The company currently operates out of 10,000 square feet at 901 Market St. There, it offers creators such as photographers, dancers and designers access to co-working space, design studios, editing suites, equipment for recording and podcasting, as well as rehearsal and performance spaces, plus a 250-person venue.

Locally, REC Philly’s partners include Comcast, Live Nation, Temple University, T-Mobile and WXPN. The startup has amassed more than 1,000 members.

REC Philly was founded by Philadelphia natives William Toms and Dave Silver, who were also Forbes 30 Under 30 honorees in 2021 in the Social Impact category.

The Rounds

Founded: 2019

Founders: Alex Torrey and Byungwoo Ko

Headquarters: Philadelphia

The Rounds has made delivering and restocking “bottom of the cart supplies” the center of its business model.

The company delivers products like cleaning supplies, pet supplies, everyday household items and standby pantry products directly to consumers while incorporating elements of sustainability. As a result, it has seen revenue multiply tenfold over the past year and has grown to more than 10,000 members.

Now the Philadelphia startup is looking to perfect its “milkman model” by having its employees not only deliver goods in reusable containers, but pick them up again once they’ve been emptied.

Taking things a step further, co-founders Alex Torrey and Byungwoo Ko want to build out a technology platform that will automatically help consumers restock their pantries. The “psychic home manager” technology would schedule deliveries based on what customers need and how often they use the products.

In October, the company raised a $38 million Series A, funding that will go toward hiring a team to build out that technology.

The Rounds currently operates in four markets — Philadelphia, Washington, D.C., Miami and Atlanta — and will look to continue investing in those markets before expanding to others.

Savana

Founded: 2009

Founder: Michael Sanchez

Headquarters: Malvern

Savana may have been founded over a decade ago, but it’s just now turning its eye toward growth. To do so, the Malvern fintech raised a $45 million Series A in August.

With the fresh funding, the company is looking to add 100 employees to its current staff of about 200 in the upcoming year, with most of those jobs being located in Greater Philadelphia.

Savana’s platform helps banks further digitize and innovate their existing services. Its software connects existing departments and offerings into a cohesive online platform. The Main Line company has about 20 direct clients and its software is used by thousands of banks.

Prior to its Series A, the company raised $2.9 million in 2020.

CEO Michael Sanchez said he believes the Series A will take the fintech through profitability and to positive cashflow.

Its founder is no stranger to the fintech space having started and taken public Sanchez Computer Associates with his brother, Frank. That company was acquired in 2004 for $180 million by Fidelity National Financial.

Versogen

Founded: 2019

Founders: Yushan Yan and Lan Wang

Headquarters: Wilmington, Delaware

University of Delaware spinout Versogen has a goal of eliminating 1.4 million tons of carbon emissions annually by 2030 through its nextgeneration product. Its wind and solar-powered electrolyzers have the potential to decarbonate fossil-fuel-dependent industries by generating green hydrogen at scale.

Founded by Yushan Yan, University of Delaware’s chair in chemical and biomolecular engineering, the company raised a $14.5 million seed round in May and is plotting expansion. The startup received $600,000 in grants from the state of Delaware and will invest $4.8 million in its move from the Delaware Innovation Space in Wilmington to FMC Stine Research Center in Newark, which it plans to renovate.

Versogen expects the new site to be fully operational by 2024. In addition, the green hydrogen startup has plans to increase its headcount more than 300%, adding 49 jobs to its existing team of 16 over the next three years.

Vitara Biomedical

Founded: 2019

Founder: James McGlone

Headquarters: Philadelphia

Vitara Biomedical has a mission to save the lives of pre-term infants and transform neonatal care. The company’s technology provides premature newborns with a stable environment to develop outside of the womb while they acclimate to their new environment.

Its “Bio-Pod” is like an artificial womb that allows the infant to continue to mature and protects it from potentially harmful overexposure to light, sound and changes in temperature. Vitara Biomedical raised a $75 million Series B round in August to support the company’s next phase of trials.

In 2023, Vitara is seeking to begin human clinical trials of the technology, which was successful in two animal models.

Vitara’s technology is licensed from the Children’s Hospital of Philadelphia, which is also an investor in the company.

WatchBox

Founded: 2017

Founders: Danny Govberg, Tay Liam Wee, Justin Reis

Headquarters: Bala Cynwyd

Spun out of Govberg Jewelers, WatchBox sells luxury pre-owned watches through both e-commerce and brick-and-mortar stores. After a successful 2022, the company is looking to expand its inventory to include luxury jewelry in the first quarter of 2023, according to CEO Danny Govberg.

Govberg has goals of making the Bala Cynywyd brand into a global company, and WatchBox is well on its way to fulfilling that vision. In the last two months of 2022, the company opened new U.S. locations in Boca Raton, Miami, Los Angeles and New York, as well as international outposts in Shanghai, China, and Riyadh, Saudi Arabia, giving it a total of 13 stores.

Its expansion comes thanks in part to the $165 million in growth capital raised in November 2021 from a star-studded lineup of investors including Michael Jordan, Giannis Antetokounmpo, Michael Strahan and hedge fund manager Bill Ackman. After the company’s massive round, WatchBox was reportedly valued at $1 billion.

In the past year, WatchBox has also gone on to acquire Swiss watchmaker De Bethune, a “niche brand” that WatchNox is looking to grow.

Up until this point, WatchBox’s business model has been to sell luxury pre-owned timepieces from brands like Rolex, Cartier, Audemars Piguet and Patek Philippe. The average watch currently sells for $32,500, according to the company, a 62.5% increase from $20,000 in late 2021.

Now WatchBox is leaning into even higher-end options. Last month, there were 25 watches listed for more than $300,000 on WatchBox’s website, with an F.P. Jorne going for nearly $700,000.

The company projected it would hit $400 million in sales in 2022, seeing 20% to 25% growth in the calendar year.

Wealthmore

Founded: 2021

Founder: Mical Jeanlys-White

Headquarters: Greater Philadelphia (remote)

Wealthmore’s Mical Jeanlys-White, a former JPMorgan Chase & Co. executive, is “reimagining the world of investing” by looking to make it more accessible to underrepresented communities through her app Wealthmore.

The goal is to create an app that forms communities of investors — Black women investors could be one community, for example — who engage with experts leading the group and provide individual advice and direction. Portfolios are tailored to each group with updates and insights posted by the advisor in real-time.

Jeanlys-White drew some inspiration for Wealthmore from Peloton workouts, following the model of having a community led by an expert. She also drew inspiration from her grandmother, a Haitian immigrant who Jeanlys-White said would have been a multimillionaire if she had invested.

People like Jeanlys-White’s grandmother are among her targeted audience. She wants to reach those in communities where “the stock market isn’t brought up at the dinner table” and those who see financial advice as too expensive and inaccessible.

The app is currently in beta testing and will launch to the public in April. Jeanlys-White aims to have 10,000 to 20,000 users in its first year.

ZeroEyes

Founded: 2018

Founders: Mike Lahiff, Sam Alaimo, Tim Sulzer, Rob Huberty and Dustin Brooks

Headquarters: Conshohocken

ZeroEyes technology is increasingly being adopted by institutions throughout the U.S. The veteran-founded company created a technology that integrates into security cameras and helps detect active shooters.

The region’s — and the nation’s — largest public entities are taking notice. ZeroEyes landed two separate grants in August from the U.S. Air Force totaling nearly $2 million to research and develop its gun-detection technology for military use.

In November, SEPTA’s board authorized a pilot program to use ZeroEyes’ technology in an effort to curb the rise in violence on public transit. It became the first transit agency to do so, and joins ZeroEyes’ growing list of clients which includes the U.S. Department of Defense, public school districts and universities, plus Fortune 500 firms that are integrating it in their corporate campuses.

For ZeroEyes, snagging a government contract would mark a major milestone, but it is also continuing to focus on commercialization of the technology in the education and business sectors.

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