The Richard King Mellon Foundation, one of the region's largest philanthropic organizations, has announced the winners of its second annual social-impact pitch competition for startups, which will invest a total of $1.35 million across four budding enterprises.
It brings the foundation's total funding for these endeavors to $8.6 million when combining last year's competition — where $3.39 million went to 16 startup companies — as well as funding it made to startup companies outside of the formal confines of the competition itself.
Resilient Lifescience received this year's first-place award of $500,000. The startup, led by Co-Founder and CEO Brad Holden, is looking to combat drug overdoses via the use of its wearable, intelligent naloxone drug delivery systems.
Element Exo came in second-place, which comes with a $400,000 investment. As CEO, Dr. Tim Pote hopes to use the funds to aid the hardware-focused startup's development of an exoskeleton suit that can be worn by employees who conduct labor-intensive tasks.
Sustainable Composites, a startup that is recycling waste leather scrap into new products, took the third-place spot and will receive a $300,000 investment as a result. And CodeJoy, an edtech startup creating remote robotics and coding classes to go with them, came in fourth-place and will receive a $150,000 investment.
All of the startups except Sustainable Composites, which calls Lancaster home, are based in Pittsburgh.
The foundation said it received 92 submissions for this year's competition. It then vetted and narrowed the application pool down before handing the remaining candidates over to a panel of 32 judges who are experts in different niches within the startup industry, many of whom were based in Pittsburgh, though the foundation also tapped on other individuals from across the country to weigh in on the competition. These judges then presented the aforementioned startups to the foundation's board to receive final approval for the investment award.
According to Sam Reiman, director of the RK Mellon Foundation, the approach behind the competition stems from a desire to grant as much support as possible to entrepreneurs of for-profit startups who are looking to make products or offer services that offer a social benefit for the communities they call home. The investments, which are offered as debt financing via convertible notes, help to do that, Reiman said.
"I think that that model is very different from the way in which funders have historically tried to support the innovation economy," Reiman said. "We are really good at funding infrastructure of innovation and not the innovation, and for us, we wanted to cut out that middle step, in part because we could for the first time, as a result of having this greater flexibility in the way that we would distribute these funds."
Reiman said this model is already resonating with the entrepreneurs who won last year's competition and that it comes at a time when many companies are struggling to find investors amid a national market downturn.
"We are especially friendly to the entrepreneur, but we don't think anything we're doing works without making as much support available to the entrepreneur," Reiman said. "And we think that thesis holds up even more so in this new market environment we find ourselves in where capital is becoming nearly impossible to raise for a lot of these early-stage companies that don't have the revenue to back up a certain valuation."
