The Future 5 of Boston Tech, Q1 2022
Sure, the latest initiatives from the Teslas, Apples and Googles of the industry tend to dominate the tech news space — and with good reason. Still, the big guns aren’t the only ones bringing innovation to the sector.
In an effort to highlight up-and-coming startups, Built In has launched The Future 5 across 11 major U.S. tech hubs. Each quarter, we will feature five tech startups, nonprofits or entrepreneurs in each of these hubs who just might be working on the next big thing. You can check out last year’s round-ups here.
2021 was a banner year for the Bay State. Nearly a dozen local standouts hit unicorn valuations, a bunch of rising stars (both homegrown and newcomers) opened new offices here to keep up with massive hiring sprees; and more than 120 Boston-area tech startups were named among the nation’s fastest-growing businesses in this year’s Inc. 5000 list, achieving a combined total revenue of nearly $5 billion, according to the magazine.
But a new year means a new crop of exciting startups to keep and eye on, and this city is full of them. From wearable fitness tech to an investment platform made for Black investors, these local innovators are in the midst of building some impressive companies — proving the best is yet to come here in Boston.
Built In’s Future 5 up-and-coming Boston startups, Q1 2022
- Cactivate (Marketing Tech)
- Impact Biosystems (Fitness Tech)
- Outdone (Gifting Tech)
- Stackwell (Fintech)
- TireTutor (E-Commerce)
Cactivate (Marketing Tech)
E-commerce is in the midst of a seismic shift thanks to the Covid-19 pandemic. More people than ever are swapping department stores and malls for the internet; and with the rise of sites like Etsy, Shopify and (of course) Amazon, it’s never been easier for businesses to establish a brand online. On its face this looks great, but Boston entrepreneur Wentao Xiao says this level of accessibility is really a double-edged sword for small and medium-sized businesses.
“There is more competition for the customer’s attention and the rapid changes in tracking policies have also been difficult to keep up with,” Xiao explained to Built In. When this happens, he added, some businesses will turn to special consulting agencies, but these services are overpriced and are “under-delivering.”
Xiao came face-to-face with this problem back in 2018, when a startup he was trying to get off the ground — a “social shopping marketplace” app — was going through a hard time. One of its vendors, Anna, came to the company frustrated with the app’s inability to generate sales for her clothing brand. When Xiao and his co-founders dug in, they learned that Anna was paying $6,000 a month for an agency that was generating “terrible” results for her customer acquisition efforts. They soon discovered that Anna was not alone — almost all 200 of the company’s vendors had a similar story.
We believe that all small businesses with a great product or service deserve a chance to succeed.”
So, Xiao and his co-founders Zhe Lu and Peng Wu created Cactivate, a platform designed to provide affordable, automated marketing solutions to small and medium-sized businesses. Using AI, Cactivate can create plug-and-play solutions that improve a business’s paid traffic, then uses machine learning to continuously optimize those results. All of this is to help avoid what Xiao calls the “cold start problem,” allowing them to benefit from day one, even if they have little to no data.
“Our mission is to create a one-stop-shop product that gives small businesses a better chance to compete in the market,” Xiao said. “We believe that all small businesses with a great product or service deserve the chance to succeed; and we are excited to play a role in helping them acquire customers more cost-effectively, and in turn, profitably. No small business should fail because they couldn’t bear the cost of an agency.”
And Cactivate seems to have made quite a splash so far. Xiao says it has helped hundreds of e-commerce stores increase their return ad on spend by more than 20 percent, in some cases even taking them from the brink of bankruptcy to a growing business. The startup graduated from MassChallenge Boston in 2020 and soon after got a $800k pre-seed round from notable investors including Pasadena Angels and EmergingVC. Now, Xiao says the next step is to invest in its machine learning model, acquire more customers and grow its team.
Impact Biosystems (Fitness Tech)
One day, Bridget Hunter-Jones and a group of fellow MIT inventors and engineers were approached by a professional athlete and his trainer with a very interesting challenge: they wanted to figure out a way to quantify the tightness in the athlete’s muscles instead of just measuring it based on touch and feel.
“Measurable and data oriented tools are a growing demand in the health and fitness space,” Hunter-Jones told Built In, citing the popularity of things like step trackers and calorie-counting apps. “Muscle recovery has been primarily guesswork based on touch and feel — there hasn’t been a scientific, quantifiable approach to it.”
The team jumped on the chance, and eventually created a startup called Impact Biosystems with the goal of developing adaptive hardware and software people can use to improve performance and recover from injury faster. Its flagship product, a full-feedback smart massager called Pact, is launching this year.
Pact is designed to help people personalize their muscle recovery and effectively treat whatever problems arise, and all from home without a personal trainer, physical therapist or masseuse. The product has made more than $100k on crowdfunding site Indiegogo, and Impact Biosystems raised $4.5 million in seed funding last year — a triumph made even more impressive when you consider that the round closed just nine days before Hunter-Jones gave birth to her son.
We’re building a team of predominantly female engineers with a culture and brand that respects and promotes diversity.”
“It was a wild experience. My due date kept getting closer and we were still waiting on a final verdict from our major investor,” she said, recalling that a partner at the VC firm asked if she would like to go for a walk as a “final step” in the process. “I told him I was 38 weeks pregnant and couldn’t walk fast but I’ll be there as long as he was prepared to drive me to the hospital. We walked and at the end of the walk he said his mind was made up and they were in. Luckily, I did not go into labor that day.”
Beyond all of this success, Hunter-Jones says she is most proud of Impact Biosystems’ team, and their agility during such a difficult time.
“Building a hardware product in a global pandemic is a challenge that only an agile and concerted team, like ours, is positioned to solve,” she said. “I’m also proud of our focus on diversifying our industry. We’re building a team of predominantly female engineers with a culture and brand that respects and promotes diversity.”
Outdone (Gifting Tech)
We all know the feeling: a holiday or birthday is looming in the not-too-distant future. You have to get someone a gift, but you can’t for the life of you think of what to buy them. Surely, lots of us were going through this just last month for Christmas, and this is exactly what Hugh Lagrotteria and Jonathan Nass were going through in the fall of 2019.
“We couldn’t find any companies out there attempting to solve this problem,” they told Built In. “It seemed to us that it would be a great problem to tackle with the power of data science and machine learning.”
The friends put the idea on the back burner, and waited for the holiday season to pass. Then, the pandemic hit, and they were stuck together in their 600-square-foot apartment on K Street with not much to do. So they started building Outdone, a new platform that makes gift recommendations using AI and machine learning. All a user has to do is plug in some basic information about the person they want to give a gift to, and Outdone does the rest.
With in-person shopping becoming less and less popular, we’re working to fill that void in the digital arena.”
To Lagrotteria and Nass, Outdone is “akin to the knowledgeable retail clerk of decades past,” they said. “With in-person shopping becoming less and less popular, we’re working to fill that void in the digital arena.” Plus, as more brands go the “direct-to-consumer route,” they say shopping is becoming more “siloed,” which makes comparison shopping more difficult. “Outdone is working to bring this back by recommending multiple brands and multiple items — ultimately letting the user decide which gift matches their gift-getter the best,” they added.
Indeed, Outdone is coming on the scene at a massively important time for e-commerce, with some experts expecting the U.S. market to be worth $1 trillion this year. This has also been a big year for AI and machine learning, as seemingly every industry — from healthcare to finance — continues to harness its capabilities in unique and innovative ways.
“It’s hard to find many industries that the machine learning revolution hasn’t already left its mark on. But for now, we’re the only gifting startup (that we know of) that’s leveraging ML in this way — and we’re super proud of that,” Lagrotteria and Nass said. “The user feedback we’ve received so far has us super excited about the future.”
The wealth gap between Black and white Americans is older than the country itself — an ugly consequence of centuries of institutional and systemic racism that remains alive and well today. This reality is perhaps most vivid in the U.S. stock market, says Boston entrepreneur Trevor Rozier-Byrd. Because they’ve historically been denied full participation in this country’s banking and financial system, he says Black Americans haven’t been able to realize “their fair share of the American dream,” resulting in a “massive trust gap” between them and the institutions that run the system.
“In order to change the status quo, we need a different solution,” he told Built In. “A solution that is made for, and by us, that is focused on encouraging and empowering more people to participate in the market with better products, investment tools and information, and creating a community of Black investors that supports one another and values the importance of collective achievement as it relates to the accumulation of wealth over the long term.”
That’s why Rozier-Byrd has created Stackwell, a new digital investment platform for Black investors. The app, which is in beta now and is expected to officially launch early 2022, serves as a “robo-advisor” that automates investment portfolios based on a user’s specific goals and profile. It also offers content to help users better understand the fundamentals of investing and financial literacy.
I founded Stackwell to make building wealth in the Black community a real possibility.”
This is an area Rozier-Byrd knows well. After spending years as a lawyer and business executive in the asset management industry here in Boston, he says he saw first-hand how important the stock market was to generating long-term wealth — and how “stark” the wealth gap between Black and white Bostonians is specifically — and wanted to build something that could make an impact in his community.
“I founded Stackwell to make building wealth in the Black community a real possibility — to build a solution focused on empowering a new community of Black investors that could harness the power of the market to grow their wealth over the long term,” he said.
On its face, Stackwell probably doesn’t sound all that different from the bevy of other investment apps that have cropped up over the years. But Rozier-Byrd says the app is specifically designed to remove the “social, emotional and cultural barriers” that have prevented Black Americans from participating in the investment space. Stackwell also stands out because it is one of the few Black-founded startups to have received venture capital investment, which it will use to grow its team and continue to build out its platform.
E-commerce has touched virtually every industry. Fashion, groceries, fitness, and even tires. That’s right, want to buy tires online? Turns out, there’s a new app for that, and its name is TireTutor.
Backed by MIT and founded by former early employees at popular car shopping site CarGurus, TireTutor brings all aspects of shopping for tires right to your computer. It has managed to grow quite a bit, raising a $4.2 million seed round just last month. And now, the young startup is looking to expand geographically and grow its team here in Boston.
“There are so many great companies in Boston to aspire to,” founder and CEO Jason Abrahams told Built In, citing local standouts like Toast, Jellyfish and his native CarGurus. “There’s so much talent in this city.”
I’m excited to bring software solutions to local businesses that otherwise may get left behind in the digital economy.”
In fact, Abrahams likens TireTutor to restaurant management giant Toast, a big name here in Boston. Except, instead of digitizing the restaurant industry, his company helps power e-commerce, supply chain and payments for independent tire dealers and dealerships. It provides an all-in-one service — a place where consumers can shop, schedule and buy tires completely online — which is essential to these small businesses as the industry continues to digitize.
“I was on a call this week with a new dealer,” Abrahams said, claiming the dealer had been searching for months for a software that could take his brick-and-mortar business online. “He needs cloud-based software that powers his digital marketing, supply chain, and online payments. As the shift to e-commerce accelerates during this pandemic, I’m excited to bring software solutions to local businesses that otherwise may get left behind in the digital economy.”