Forum awards $15K to firm; Entrepreneur beats out 18.
WORCESTER - John H. Lai has developed software that compresses large medical images into small files. Now he plans to expand his business globally.
Mr. Lai, founder and chief technology officer of DataPacT Systems LLC, which can reduce the size of a digital medical image data file to as much as one one-hundredth of its original size, was recognized for his innovation and business plan last night by winning $15,000 in cash and professional services in Worcester Polytechnic Institute's Venture Forum Business Plan Contest.
DataPacT, based in Milford, N.H., bested another medical device company, Corum Medical Inc. of Sudbury, and Vipcort, a Falmouth-based Internet telecommunications company. The audience of about 65 and two judges decided on the winner after 15-minute presentations by the principals of each company, follow by question-and-answer sessions.
Mr. Lai told the gathering in the WPI campus center that the market for medical image data storage was $6 billion last year and that it is projected at $10 billion next year. He said his product would help hospitals and medical professionals deal with the explosive growth in medical image files. He said he is looking for $3 million to $5 million in series A venture funding to get his product to market.
"We would sell to the health care industry, so we would get straight to the revenue stream," he said.
Alan R. Kivnik, president and chief executive officer of Corum, described his company's product, Lumen I, a hand-held, battery-powered device for measuring a patient's hemoglobin, a protein in the blood that contains iron and transports oxygen. He said the device would replace needle sticks or comprehensive blood tests that test for a number of blood criteria. The company currently has two patents associated with the device and plans to develop four more patents, he said.
Corum has raised $350,000 so far, and needs another $3.5 million in funding to launch the company, Mr. Kivnik said. He estimated that the device could garner $57 million in revenues over the first five years, selling primarily to hospitals and emergency departments in the initial years.
"We estimate that we would be self-funding at the end of the first round of venture funding," he said. "The question is, is there really a need for this wonderful idea?"
Kevin H. Mulvey, founder of Vipcort, said his company would act as a clearing house for several telecommunications providers, integrating their products and services into packages the customers need. He said the company needs $5 million to begin delivering services.
Judge Stephen Rubin, who heads the Boynton Angels investment group, said DataPacT had a slight edge over the others.
"All three companies were very good," he said. "The medical companies were neck-and-neck. What I liked about DataPacT was that they have a solution for a present issue. The storage of medical image data files is growing.
"They have a short path to market. They have a plan to get to market with approval from the Food and Drug Adminstration and a plan to get to market without FDA approval."
The three companies were selected as finalists for last night's program after competing against 16 other entrepreneurs at an Oct. 24 Venture Forum competition.