The MIT $50K Entrepreneurship Competition judges -- deadlocked over the high quality of student business plans -- named two winners of the coveted $30,000 top prize at the final awards ceremony last Thursday.
Volunteer Community Connection and Direct Hit -- two Internet-based ventures -- each received $30,000 after an anonymous donor fattened the fund with an additional $20,000. The donation transformed the usual $50,000 prize into $70,000, marking the first time in the competition's history that two teams each received a grand prize. A third company, CarSoft, earned the runner-up slot with a $10,000 prize.
In another unprecedented move, Direct Hit donated its $30,000 winnings to the other finalists after announcing it had received a commitment for $1.3 million in funding. Making the event even richer, contest alumni/ae Krisztina Holly, John Barrus and Mike Cassidy, whose company Stylus Innovations won the grand prize in the 1991 $10K Competition, returned their original $10,000 award to encourage student entrepreneurship. Artisoft acquired Stylus Innovations in 1996 for $13 million.
The two grand prize winners at the ninth annual MIT event included a non-profit and a for-profit venture. Volunteer Community Connection is an Internet-based clearinghouse that matches volunteers and nonprofit organizations. Direct Hit provides software that improves the performance of existing Internet search engines.
CarSoft, the runner-up, designs and produces automotive diagnostic tools that connect to home computers. Other finalists included Akamai Technologies, which develops ways to speed content distribution through the Internet; SiliconTest, which designs probe cards for semiconductor chip testing; and WeddingBell.com, which registers wedding gifts via the Internet.
The six finalists were chosen from 84 entrants and 30 semifinalists. Judges selected six finalists based on the quality of their business plans. Each finalist presented its plan to the final awards audience of more than 500, including venture capitalists and business leaders. The event reached a global audience through a live Internet broadcast.
Entrepreneurial luminaries led the ceremonies. Bill Porter (Sloan SM '67), chairman and founder of E*Trade, delivered the keynote address. Judges included Mitch Kapor, founder of Lotus Development Corp.; J. William Poduska, Sr., founder of Prime Computer and Apollo Computer; and David Morgenthaler, founder of Morgenthaler Ventures.
Student entrepreneurs must actually launch their companies to receive the prize money. In addition to the six finalists, 12 other teams plan to transform their plans into corporations. Several teams have conditional commitments for venture financing in hand.
The MIT $50K Entrepreneurship Competition is the world leader among university-based business plan competitions, recently described by Inc. Magazine as the business plan competition that is "more equal than all the others." In its nine-year history, the contest has facilitated the birth of more than 30 companies with more than $180 million dollars in aggregate market value and created some 500 jobs.
Successful start-ups from past competitions include Firefly Network (acquired by Microsoft), Lexicus (acquired by Motorola), SensAble Technologies, Webline Communications, Stylus Innovation, Silicon Spice, and Flash Communications (acquired by Microsoft).
A version of this article appeared in MIT Tech Talk on May 13, 1998.