By Patty Houlihan
Photos courtesy of Chicago Booth
Sometimes a little aggravation leads to a good idea—and when thousands of people share that aggravation, the idea can jumpstart a new product and company.
As an engineer at Texas Instruments in 2005, David Lieb got tired of exchanging business cards with other people. “I met some new colleagues and thought, I wish there were a way to automate contact info exchange, but I couldn’t think of a way to do it using the mobile phones we had in 2005,” Lieb says.
In 2008, Lieb came to Chicago Booth where he met a former Texas Instruments engineer Jake Mintz, whom Lieb had not met at the company. Mintz joined Lieb, who already was working with another Texas Instruments colleague Andy Huibers, to find a way to make sharing contact information easier. Lieb says, ”I found myself entering lots of phone numbers again, but I realized that all my friends also had iPhones. During an accounting class in the fall, the idea hit me for how we could do it.”
They co-founded Bump Technologies Inc. and developed an application that lets iPhone users exchange contact information with the bump of a hand. The iPhone—or iPod Touch—made it possible because those devices have accelerometers. “The phones don’t talk to each other directly. An accelerometer in each phone responds to the bump and contacts a central server, which matches everything up. Pretty clever,” noted Discover magazine, which praised the application in an online story and featured a video clip of it in use.
Once they developed the software, Lieb says, Apple made it easy. “You download the free development kit online. You pay a $99 fee and put your app up on the iPhone app store.”
At Chicago Booth, Lieb and Mintz learned how to turn the idea into a business. They enrolled in the New Venture Challenge course, which teaches students how to draft a business plan and present it to potential investors. That meant facing the scrutiny of Booth faculty and professional investors who judge the competition.
“They made us challenge everything: our ideas, our concepts, our assumptions. That approach toward entrepreneurship was a key to our success,” says Dominic Hofstetter, another first-year Booth student on the Bump team.
The Booth experience taught the team how to tell their story to investors in the most compelling way, Lieb says. In the process they perfected “an exciting pitch that keeps investors off their Blackberrys and listening to us.”
Preliminary judge Franco Turrinelli, MBA’96, a public company equity analyst for William Blair, was among those who first critiqued the business in a class judging session. “This is platform technology that can initiate almost any transaction we can imagine. And every judge in the room could think of a different way it could make money,” he says. “That’s really powerful.”
Bump Technologies was voted to be one of 10 finalists in Chicago Booth’s May competition. New Venture Challenge judge Ellen Carnahan, MBA’84, a 20-year venture capitalist, now with Machrie Enterprises LLC, says, “It’s a simple idea, and it solves a problem that every business person has.”
Their initial application, offered for free on Apple’s iPhone App Store in March, immediately took off. By the time the team made its pitch at the New Venture Challenge finals, they could report that 800,000 people had downloaded the app. Judges took notice, and Bump tied for first place.
The Bump application has since grown into one of the top five free applications for the iPhone.
At Chicago Booth, a lot of students and faculty are Bumping. Lindsay Hagan, a Booth student, says, “When I made the switch to the iPhone and to Bump, exchanging contact information went from tedious to fun and whimsical.”
Booth student Amish Shah echoed the thought. “I’m a big fan of the app. At business school, I’m constantly meeting new people, and Bump takes all the pain and frustration away from entering their names, numbers, and email addresses into my phone. Its pure simplicity, and the ‘wow’ factor makes it fun.”
Originally published on September 2, 2009.