LabDoor: From Startup America Pitch to VC-Funded Startup
By Neil Thanedar, CEO LabDoor
LabDoor, a digital health company and Startup America member, was recently accepted into the prestigious Rock Health incubator and signed a major venture-backed seed investment, all less than six months after its formation. While the course of our startup story is just beginning, it is exciting to look back and learn from the experiences we’ve had since the first LabDoor seeds were planted at Startup America.
Where there’s pain, there’s an opportunity
My LabDoor journey began in a Startup America meeting with Scott Case. While brainstorming ways to take my product safety lab, Avomeen Analytical Services, to the next level, I grew increasingly frustrated with my company’s industry. Our independent laboratory had become an industry expert in understanding what makes consumer products like supplements and pharmaceuticals safer, but our reports to the FDA and manufacturers were never released to the public. Meanwhile, customers have been left on their own, stuck with confusing product advertising, labels, and user reviews.
Disrupting a trillion dollar industry
What if you could easily access a ‘consumer report’ for every energy drink, multivitamin, or cholesterol pill? One that simply explained the safety, efficacy, and price of products on a known A-F grading scale? That’s the vision behind LabDoor’s consumer product ratings.
Manufacturers in the pharmaceutical and supplement industries make over $1T/year, and a huge chunk of that revenue comes from uninformed consumers buying unneeded or unsafe products. For nearly a century, we’ve entrusted the FDA and their $4B/year budget to regulate these products. But where bureaucracy has failed to provide consumer-focused solutions, LabDoor’s team of mobile health entrepreneurs are developing beautiful, easy-to-use iPhone and web applications that you can use in stores or while shopping online.
Finding a new startup family and home
After spending four months building the data, APIs, and applications behind LabDoor, we were presented a unique opportunity: Rock Health, a San Francisco-based startup incubator, offered us an interview with their program leaders and investment partners. We jumped on the first plane out of Indianapolis, and rushed to prepare our pitch. Three days later, we were sitting across from a table of five top VCs, and that evening we received our first offer.
For most of our team, who have spent decades growing and supporting technology startups in the Midwest, it felt almost blasphemous to pick up shop and move to Silicon Valley. But we decided that partners and investors like these will only come around once in a lifetime, and we accepted an offer to move into Rock Health’s offices in the heart of San Francisco’s Chinatown.
VC funding is just the beginning
We have recently earned the amazing opportunity to work with world-renowned investors like Kleiner Perkins Caufield Byers, Mayo Innovation Fund, Aberdare Ventures, and Mohr Davidow Ventures. This is great news for LabDoor, but is something we see as a responsibility, not an accomplishment.
Too many aspiring and new entrepreneurs get caught up in the chase for VC funding. That first external investment can help provide fuel and validation for your product idea, but your real success or failure will come from your ability to put together a great team and execute on your vision. Startup funding is a symptom, not a cause of startup success. Raise a ‘right-sized’ round, and then get back to work!
It is always/never the right time to start up
When the idea for LabDoor hit me, I already had an awesome small business to run. At first, I thought it would have been so much easier to keep LabDoor in my journal of startup ideas and come back to it years later. But while it’s never the perfect time to create a startup, this is our best shot of making LabDoor’s vision a reality. The digital health market is set to double next year, and is rocketing into the mainstream. If your idea is truly life-changing, other entrepreneurs will surely find it soon. Don’t risk being that guy who tells all their friends years later, “I actually had that idea first, I just never executed on it.”
Neil Thanedar, 24, is CEO and Founder of LabDoor, a digital health company that grades the products in your medicine cabinet. LabDoor is a member of the Rock Health startup incubator, and recently closed a VC-led seed investment. LabDoor is Neil’s fourth startup, and second as a founder, earning him the title Generation Next Entrepreneur To Watch by CNNMoney.
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Opinions and statements expressed by guest bloggers are theirs alone, not opinions of The Startup America Partnership.