Montana Startups to Watch 2019

Graphic by Kyla Kozole/MHTBA.

By Katy Spence

While Montana has long been recognized for its startup activity, a few recent developments have increased the opportunities for Big Sky entrepreneurs.

In July, Montana State University received a $750,000 federal grant to promote high-tech economic development statewide, some of which will go towards supporting high-tech startups. Early Stage Montana added a second HyperAccelerator in 2019 and just announced their latest cohort of high-potential startups that will be competing for $50,000 in November at a Statewide Showcase. And new Whitefish-based venture capital firm Two Bear Capital is the latest addition to a growing trend of investor interest in Montana companies.

With more support for startups, it’s no wonder our 2019 list is up to 11 companies. We asked experts at Next Frontier Capital, Frontier Angels, Montana Manufacturing Extension Center, MSU Blackstone LaunchPad, and UM Blackstone LaunchPad to nominate early-stage companies. Startups in Billings, Bozeman, Missoula, and Whitefish made the final cut.

To select the finalists, we looked for companies five years old or younger that fit at least two of the following criteria:

  • Steep revenue growth and/or are working in a high-growth sector
  • Poised to launch high-potential products or services
  • Own or are developing valuable intellectual property
  • On track to land major clients or enter new markets
  • Plan to expand operations or add a significant number of jobs in the next year
  • Have management teams led by experienced entrepreneurs or top experts in their fields

Here are our picks in alphabetical order:


Blacksford, Bozeman

Image via Blacksford.

Founder: Jonathan Distad, CEO

What they do: tech-enabled RV rentals

Why we’re watching them:

It’s a familiar story for RV enthusiasts: you get the itch to take your family on a trip, only to discover a tedious renting process and low vehicle availability. Demand is at a peak for RV rentals, and if you do manage to find a vehicle, you’re likely to end up with a well-used, older model, hidden fees, and poor customer service. According to Kampgrounds of America, there were more than 38 million camper households in North America in 2017, and that number continues to grow, straining existing RV renters. 

Bozeman entrepreneur and RV enthusiast Jonathan Distad saw an opportunity for an agile and intuitive RV rental platform to fill a need and fix existing problems in the RV rental industry. With an exclusive partnership with Winnebago, Blacksford rents out nearly-new RVs with packages that include unlimited miles, national parks passes, and basic amenities like dishes and bedding. With Blacksford’s technology focus, users can easily rent an RV through the web or mobile.

Founder of 2018 High-Growth Company to Watch Zinovo, Distad launched Blacksford in June 2019 out of the Bozeman airport. A few weeks later, the rentals were completely sold out and remain sold out until the season ends this October. Blacksford is also renting RVs out of the St. George, Utah, airport. The company plans to expand to a dozen more airports in the next couple years.

Blacksford is also focused on leasing RVs for extended trips and establishing pre-paid RV clubs in cities around the country. The RV Club will be launching in nine cities across the U.S. next year, with a limited number of memberships and some seasonal restrictions in a few cities.

While Blacksford anticipates revenue of $500K in 2019, Distad says the market potential and addition of services and cities could rocket revenue to more than $8 million in 2020. Future partnerships with companies like Mercedes could turn Blacksford into a modern full-service RV rental and maintenance company.

Blacksford’s team currently consists of three people, though with revenue growth and addition of services, Distad said the company will likely add 50-70 jobs in 2020, ten percent of which will be part of a Blacksford Bozeman hub. As the team grows, the company will be building its own IP and establishing its own customer service and reservation systems.

Cardsetter, Billings

Image courtesy of Cardsetter.

Founders: Jessica Baldwin and Joshua Toenyes

What they do: a content-design platform for small publishers, professional bloggers, and content creators

Why we’re watching them:

After being chosen as the wild card entry for the 2018 Early Stage Montana program by the Montana High Tech Business Alliance board of directors, Cardsetter founders Jessica Baldwin and Joshua Toenyes have been busy. They just closed a six-figure pre-seed round from private investors and are gearing up to showcase their product as a sponsor at the TBEX (Travel Bloggers Exchange) North America 2019 Conference, an international travel bloggers’ conference which will be held in Billings this year. 

Cardsetter is an intuitive, easy-to-use website builder aimed toward the little-serviced niche of individual and small online content producers. Users can build responsive and attractive websites without any coding or website design experience required. While WordPress, Wix, and Squarespace can work for simple, small business websites, Cardsetter can offer more advanced solutions for content-heavy websites, such as digital publications, professional bloggers, and content marketers.

With the feedback from the ESMT program, Baldwin and Toenyes are pushing their product to market, which is gaining significant traction among publishers in visually-oriented fields like tourism, lifestyle, fashion, photography and food.

Cardsetter currently serves clients like Bozeman’s Big Sky Country Fair and Billings’ Simply Family Magazine and is hosting the online TBEX attendees’ guide to Billings. They’ve also written a book and created a workbook to help new content producers make the most of their business.

Toenyes said Cardsetter continuously rolls out updates and new features, and a new “sandbox” feature is in the works. Using the sandbox, new users can start building their website before they sign up as Cardsetter customers. This feature will serve as a hybrid marketing and onboarding tool to give new users a quick introduction to the product.

A business graduate of Montana State University, Baldwin brings nearly 15 years’ experience in marketing and content promotion to the team, and also runs event website Billings365.com. Toenyes, a U.S. Navy veteran, is a computer science graduate from the University of California-San Diego and has more than 10 years of experience in web development and software engineering. 

Charmed, Missoula

Image via Missoula Current.

Founders: Taylor Margot, CEO; David Blanchard, CTO; Jack Peterson, VP Engineering

What they do: mobile app that allows dating app users to solicit advice from their friends

Why we’re watching them: 

Dating apps have introduced a new way of connecting in the modern age, and Charmed co-founder and CEO Taylor Margot is hoping his mobile app will help users reconnect with the social aspect of dating.

It’s not uncommon to “match” with someone on a dating service only to have the conversation stall. Charmed users can easily loop their friends into a chat window to get their advice on how to reignite the connection and ultimately land a date. Founded in 2017, Charmed works as a “sister” app to Tinder and soon to Bumble and Hinge, three of the most popular dating apps on the market. Charmed is currently available on Android and iOS.

Charmed has about 10 folks on their diverse team, with a 50/50 male-to-female split ranging from full-time to very part-time. Margot holds B.A. and J.D. degrees from U.C. Berkeley and brings his background as a corporate lawyer in the California tech scene to the startup. His co-founder, CTO David Blanchard, is also a U.C. Berkeley alum and worked in the Bay Area as a Senior Software Engineer for goBalto (acquired by Oracle) before moving to Montana to work for Oracle in early 2019.

Margot pitched the app as Scry Chat in the 2019 Ruffato Business Startup Challenge. After a rebrand to Charmed, Margot pitched the app at the Early Stage Montana Missoula regional competition in May 2019, earning a spot as a finalist and participating in the summer HyperAccelerator program.

While the app is free, Margot said it will likely follow the path most dating apps have taken in introducing premium paid features as more and more people use it. The app has 1,000 downloads so far.

Charmed is currently marketed toward college campuses, as it works most effectively among peer groups who would be seeking each others’ dating advice anyway. Company leadership expects exponential growth as the app circulates through friend groups. Margot added that Charmed is also working with Instagram influencers to increase the app’s visibility.

Operating in a $4 billion dollar industry, Margot said the company’s next steps are applying to TechStars Boulder and raising a series seed of round of $2 million. Charmed has already attracted a handful of interested investors. The company is also exploring the patentability of certain features in the platform.

DRIMS, Missoula

Image courtesy of DRIMS.

Founder: Tom Donohue, CEO

What they do: platform enabling nonprofits, government agencies, and other organizations to connect, share resources, and increase efficiency in disaster-response situations

Why we’re watching them:

While DRIMS (Disaster Recovery Integrated Management System) was only founded in April 2019, Tom Donohue has been working towards this platform solution for nearly 15 years. Donohue was part of coordinating disaster relief following Hurricane Katrina in 2005. With a background in tech, Donohue saw a space for technology to improve disaster relief efforts, making them more coordinated and efficient for both those offering and seeking aid.

DRIMS is a secure system that enables organizations and agencies to more efficiently deploy people, equipment, materials, food, water, and financial resources in a coordinated way to help people impacted by a disaster. The system also provides a single point of contact for people who need support in recovering from a disaster. For example, agency representatives can log in to the system and share supplies and information, as well as procure longer-term assistance such as finding employment and more permanent housing. 

DRIMS can be used to help mitigate issues related to natural disasters, man-made disasters, homelessness, and poverty-related challenges. Donohue said DRIMS can drastically reduce the amount of time and paperwork organizations normally need to fill out to find this kind of information.

In addition to Donohue, DRIMS leadership team boasts more than 50 years of experience in tech and working with disaster recovery nonprofits. Director of Customer Advocacy Peg Case has more than 30 years of experience in disaster education and preparation and has been awarded the FEMA Award for Superior Performance & Outstanding Achievement in Disaster Recovery & Preparedness Education. Dan David, Director of Technology, has worked with enterprises for more than 20 years in system administration, cybersecurity, and data storage/visualization.

DRIMS’ is currently in negotiations with the United Way of Central Louisiana, and the company hopes to add connected services like Re-Entry Solutions, a program for transitioning ex-offenders, to their client list as well. As DRIMS partners with more organizations, they plan to hire 10-20 new employees in 2020 to add to the current staff of five, and Donohue said they’ll hire as many as they can in Montana.

Donohue pitched DRIMS at the Early Stage Montana Missoula regional competition in May, taking first place. After participating in the HyperAccelerator, Donohue said the team has been integrating feedback and are ready to accelerate company growth through more focused delivery to market. They’re currently accepting applications for disaster relief organizations interested in serving as beta testers.

DugalHealth, Bozeman

DugalHealth founder Michael Fox demonstrates the DugalDiabetes app for Senator Jon Tester and a member of his staff. Image courtesy of DugalHealth.

Founder: Michael Fox, CEO 

What they do: mealtime insulin tracking and data collection app

Why we’re watching them:

For DugalHealth founder, registered dietitian, and type 1 diabetic Michael Fox, the DugalDiabetes app isn’t just a handy tool to make life easier. With more data and better insulin dosing recommendations, DugalHealth aims to keep diabetics out of the hospital. Diabetics spend $3.8 billion each year being hospitalized due to low blood sugar, more than a quarter of their annual health expenditures. 

The standard recommendation to dose for the amount of carbs insulin users eat at mealtime is flawed and not holistic, Fox said, and ends up being a trial-and-error process. The app will help users dose insulin more accurately for meals by using artificial intelligence to track past meals and how users might need to adjust their dose for that meal in the future. 

Three million people in the US live with Type 1 diabetes and 11 million people in the US take insulin and could benefit from using the DugalDiabetes app to track their experiences with insulin they take at mealtime. 

Founded in 2016, Fox pitched the company at the Early Stage Montana Billings regional competition this spring and participated in the summer HyperAccelerator. In 2016, the DugalDiabetes app won the grand prize in the Mobileys competition.

While the app has immediate value for its users, Fox said the aggregated data has the potential to change the whole system of insulin dosing and tracking, including potential integration with artificial pancreases. The company has also spoken to potential partners in the health field, including representatives from the Eli Lilly Medical Innovation Center, Tandem Diabetes Care, and JDRF (Juvenile Diabetes Research Foundation). 

DugalHealth’s technical development is supported by Build, which has extensive experience in cybersecurity and cloud computing and whose CSIO has worked in the diabetes device space. Fox said about 80 percent of DugalHealth’s staff and unofficial advisory council is are people who have a connection to Type 1 diabetes somehow, whether they have it themselves, have a family member with the disease, or have worked in the field before. 

Fox said the company has gotten $100,000 in private investment and is looking for additional investment from within and outside of Montana.The app currently has 500 downloads and is in beta testing for Android and iOS.

Ferho, Billings

Image via Ferho.

Founder: Jeff Honcoop, partner and CTO

What they do: consultants for start-to-finish technology integration in new construction and upgrade projects

Why we’re watching them:

IT services don’t just include computers and conference rooms anymore; technology has been integrated into every aspect of workplaces and homes, and the planning process needs experts who can envision the full potential of smarter spaces.

Ferho was born in 2018 when its founders saw the technology world changing rapidly while the construction industry remained mostly stagnant. Co-founder Jeff Honcoop, who founded Honcoop Technology Services in 2008, saw the opportunity for technology consulting to be another aspect of the planning and construction business.

Ferho currently employees three people, including Ryan Stahl, a technology project architect who previously worked with Cody Labs for eight years. Ferho also brings in additional technology consultants to design builds.

Stahl said Ferho is connecting with architecture firms around the region to partner on planning smarter buildings and ensuring a client’s vision is fulfilled from the beginning. Their Technology Design & Discovery Services include multiple tech aspects of a new construction project, including structured cabling, security, fire, building automation, and IT needs. 

Ferho is vendor-neutral, which means it doesn’t prioritize any particular vendor. Clients get a wider variety of options and can pick providers that will help enact their specific vision.

One of Ferho’s clients, a school in northern Wyoming, needed a number of advanced technological features such as access control, intrusion systems, and modern communications. By working with Ferho, they were able to gather bids from a variety of local Wyoming and Montana companies and choose the path that best suited their vision and budget.

Ferho is currently bootstrapped and is looking for partnership projects around the state. The company is slated to help design the new Fish & Game office in Wyoming, which has a projected ground-breaking date in spring 2021.

The Insight Studio, Bozeman and Missoula 

Image courtesy of The Insight Studio.

Founder: Stefanie Sample, CEO

What they do: creative growth opportunities for businesses using HubSpot

Why we’re watching them:

Stefanie Sample, a serial entrepreneur, launched The Insight Studio to work as an extension of their clients’ business, especially in sales and marketing, which can especially help businesses in earliest stages.

The Insight Studio leverages HubSpot to help their clients find repeatable, data-driven processes behind marketing efforts that will help them create and execute long-term business models. In other words, they help their clients use the popular CRM to find new leads and grow their business.

Sample launched The Insight Studio in January 2019 and now has a team of consultants and a network of contractors. The company plans to add five more staff by the end of the year, and is specifically looking for people looking to serve others with their digital marketing or data science skills.

Not only is Sample an experienced entrepreneur with a degree in business administration from the University of Montana, she’s a member of the HubSpot Customer Advisory Council and launched the Missoula Marketers Forum. Her team includes 2018 Ruffato Business Startup Challenge winner Jenny Sheets of Storysquares; Andrew Schulz, formerly the Marketing Strategist at Goodworks Ventures; Matt Gangloff, founder of Enlyten Lab and winner of the 2014 Ruffatto Business Plan Competition with New Leaf Environmental Monitoring; and Riley Horigan, a new marketing graduate.

My Shipping Post, Bozeman

Founders: Aaste and Dillon Palczewski, general partners

What they do: software for shippers and mail consolidators to streamline the shipping process and reduce costs

Why we’re watching them:

There’s a special, very niche market that My Shipping Post is targeting: mail consolidators, facilities designed to reduce the cost of shipping and provide reliable collection and delivery outside traditional mail facilities. There are a couple thousand consolidators in the US and include mail centers like those you would find on a college campus, at a large company, or in a larger community. 

My Shipping Post co-founders Dillon and Aaste Palczewski met at Montana State University, where they both earned accounting degrees and Dillon went on to get his master’s degree. Aaste got a job at a local mail consolidator, where she managed 20 employees, and Dillon did a few cost accounting projects for the same mail house. Between them, they saw an opportunity for a software solution to increase efficiency and reduce shipping costs for mail consolidators around the world. 

With My Shipping Post’s software solution, private mail consolidators essentially become mini USPS centers that can offer great shipping rates. My Shipping Post launched their domestic software earlier this summer and plans to launch their international software this fall to service international consolidators.

They pitched the business at the Early Stage Montana Bozeman regional event in May 2019 and were selected as the wild card by the Montana High Tech Business Alliance Board of Directors. Aaste said the summer HyperAccelerator helped them develop a more rounded business plan and connect with experts who could help them continue to grow their business.

My Shipping Post is bootstrapped and has received some private funding and is looking for additional funding. With more financial support, the company is looking to add about five new employees to the software team in Bozeman, with plans to grow the support team as the business grows.

Neuro-ID, Whitefish

Image courtesy of Neuro-ID.

Founders: Joe Valacich, PhD, CSO; Jeff Jenkins, PhD, CTO

What they do: real-time behavioral analytics and prediction software

Why we’re watching them:

Most analytics software gives users a picture of the past, data about what has happened on their sites so they can predict what might happen in the future. Neuro-ID provides data about what is happening in real-time, giving clients actionable insight into potential customers as they go through the buying process.

Aptly dubbed “NOW Data™” by its users, Neuro-ID’s flagship product can track mouse movements and information input to identify high and low risk individuals, shoppers vs buyers, and more through specialized JavaScript attached to each entry field and webpage in the buying process.

Founded in 2015, Neuro-ID (Intent Detect) draws from a decade of research grounded in neuro-cognitive behavior and human-computer interaction. Co-founders Joe Valacich, PhD, and Jeff Jenkins, PhD, started the company to address a “digital gap” in customer service. As more consumers shop online for goods and services, businesses continue to see single digit conversion rates. Companies have built systems to automate online purchasing, but consumers are often turned off by lengthy application processes or wary of uploading bank documents needed for certain transactions. NOW Data can help determine if a customer can skip those extra steps, making it more likely for them to complete a transaction.

Not only can Neuro-ID help improve conversion rates, but it can detect when a user is inputting information that may be fraudulent. It shouldn’t take long a consumer long to enter their own name and birth date, but it might take longer if someone is trying to steal an identity. 

One of Neuro-ID’s clients, a top 5 digital lender, reported doubling their conversion rate for selected applicants after leveraging Neuro-ID’s real-time analytics. Another partner, Zoot Enterprises, leverages Neuro-ID’s fraud detection capabilities.

Since Jack Alton took the helm as CEO in early 2017, the company has raised nearly $8 million in private funding. A Flathead native and University of Montana alum, Alton has more than 20 years of experience as a sales executive for early-stage technology companies, most recently serving as SVP of Sales for Kount. Jenkins is an associate professor in the Marriott School of Business at BYU with a PhD in Management Information Systems from Arizona State University. Valacich earned his bachelors in Computer Science and MBA from the University of Montana and his PhD in Information Systems from the University of Arizona where he is a professor in the Eller College of Management. Jenkins and Valacich’s research has been cited more than 26,000 times by scientists worldwide.

Neuro-ID holds multiple patents on their software and sells the software as a subscription service. The company is in conversation with or currently delivering analytics to more than 70 percent of the U.S.’ top fintech lenders. Neuro-ID is planning to double their team of more than 20 people over the next two years, half of which will be hired in Montana.

Prime Labs, Missoula

Image courtesy of Prime Labs.

Founder: Rob Smith, CEO

What they do: customizable software for mass spectrometry data analysis

Why we’re watching them:

Mass spectrometry is used to determine masses and quantities of components within a sample material. It’s used in a number of fields, but perhaps most notably in healthcare, such as for discovering and testing new pharmaceuticals.

The process outputs vast amounts of raw data, which must be carefully analyzed. Prime Labs founder and CEO Rob Smith said current analytic software is limited, resulting in researchers spending ample amounts of time and money to get only a fraction of the data they could get with a better analytic tool.

Prime Labs’s flagship product, Prometheus, will provide solutions for time- and energy-intensive limitations of current analytic software, such as algorithmic limitations, data storage and retrieval constraints, and user interface problems. Smith said the tool is tapping into a $300 million per year market and will help make mass spectrometry more accessible as well as provide more accurate analysis in a fraction of the time while helping to address rising costs in pharmaceutical research and development.

Founded in 2017, Prime Labs has received multiple grants, including a Montana Board of Research and Commercialization Technology grant for $89,000 and an National Science Foundation SBIR grant for $225,000. This summer, the company was awarded another SBIR grant for $750,000, which Smith said will help the company tackle commercialization of the product.

Prometheus is currently in beta testing. Smith said the team is building a base product in the cloud that can be customized to meet specific client needs.

Smith is also an Associate Professor of computer science at the University of Montana and holds a PhD in computer science from Brigham Young University. Prime Labs currently has three full-time employees in addition to Smith, who’s hoping to hire at least four more people in the next few months.

Raven CSI, Billings

Founder: Brian Boyette

What they do: a web-based survey system to collect real-time feedback and provide immediate, actionable results to enhance the customer experience

Why we’re watching them:

While working for the largest hospital in Montana, Brian Boyette was tasked with improving the patient experience, specifically through addressing the outdated suggestion box that patients could use to raise issues with healthcare management. Using his connections in the Lean Six Sigma space, Boyette and his team develop a software tool in just four months that could alert a manager about a patient experience event in seconds.

RavenCSI (Customer Service Intelligence) is advanced survey-builder designed to help provide service-providers with real-time feedback from customers. Access to real-time customer experience data and reports helps companies take swifter action to address issues and adjust services to better meet customer needs. Boyette said the tool is set to compete with SurveyMonkey and other survey companies by offering more features, dynamic graphics, and real-time sorting capabilities that can also give data trends over time.

Boyette is the president and CEO of Avior Group, which works with organizations including the federal government to improve their efficiency using the Lean Six Sigma methodology. He worked for more than 21 years with Honeywell Aerospace in North Carolina. He said he’s built his extensive experience in lean methodology into Raven CSI, focusing on building a tool that is efficient and easy for both companies and their customers to use.

Boyette pitched Raven CSI at Early Stage Montana in Billings this year and won a place in the November statewide showcase. Boyette said the HyperAccelerator was a great way to make connections in the business and investment communities, as well as refine a business plan and valuating his business.

Raven CSI currently has two employees on staff but is looking to add a few salespeople to the team. Thus far, the company is bootstrapped but is looking for additional investment and advisors. Raven CSI’s product is live.

 


About the Author: Katy Spence is the Communications Director for the Montana High Tech Business Alliance. She worked previously with the Missoula Current and Treesource, and has an Environmental Journalism Master’s Degree from the University of Montana.

About the Publisher: Launched in 2014, the Montana High Tech Business Alliance is an nonpartisan nonprofit association of highly-engaged high tech and manufacturing companies and affiliates creating high-paying jobs in Montana. For more information, visit MTHighTech.org or subscribe to our biweekly newsletter.

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