YC winter 2013 demo day: Five startups to watch (morning edition)

Whether you think the hype around its startups is justified or not, Y Combinator is still one of the most notable Silicon Valley startup incubators to watch. Its bi-annual demo days are important events for both startups and investors in the tech community, with everyone looking to get in on the next Dropbox or Airbnb to come from the group’s ranks.

This spring marks YC’s 16th demo day, and compared to the first one I covered in August that featured more than 80 companies, today’s smaller batch of 47 looks is presenting at a slower pace that’s certainly easier for investors and the press to digest. But as YC co-founder Paul Graham noted, even if investors can focus a little more because the initial process was more selective, it won’t be that much easier for them to pick winners:

“It’s going to be just as hard to tell who’s good,” he said. “It’s not because of the format of demo day that it’s hard to tell who’s good. It’s because it’s actually hard to tell who’s good,” he said. “I mean, even we can’t tell who’s good,” he joked.

About one-third of the startups presenting on Tuesday were presented off the record, which means they’re still in stealth mode and the press agreed not to write about them. The rest of the companies are divided into two batches, one in the morning and one in the afternoon. Here are my five picks from the morning batch that you should take a look at:

Airware

Airware is a building a platform for drone software that allows customers to to manage cost-effective, small aircraft. The company allows drone manufacturers to use its hardware and APIs and then focus on the software that’s specific to the industry that requires a drone. The company explains the idea on its website: “Our os-Series Autopilots integrate hardware, tailored to specific needs, with an open architecture. This combination gives our autopilots the flexibility to be used on both development and production aircraft platforms, enabling UAS manufacturers to rapidly develop diverse and innovative UAS for commercial and military applications, while creating and maintaining intellectual property.”

SimplyInsured

SimplyInsured aims to provide a Kayak-like service for small business owners who are looking to compare the cost of picking different insurance plans for employees. The company is looking to cut out the traditional insurance brokers who relied on paper, fax, and estimates, and replace that business with a digital process that would immediately provide business owners with quotes. The company is hoping to take advantage of new Obamacare regulations that limit the effect of health insurance brokers, and target businesses that are still in the under-50 employee size.

Bitnami

Bitnami describes itself as the “app store for server software,” letting IT buyers have an app store-like experience when purchasing software to run either on the desktop, on company servers, or in the cloud. The company lists employees from companies like MasterCard, General Electric, and Boeing as customers, and said the company is already bringing in “millions” in profit.

Microryza

Microryza wants to “turn everyone with a credit card into a modern day patron of science,” as co-founder Cindy Wu explained. The company has created a crowdsourcing platform that allows individuals to contribute money toward scientific research, bypassing the traditional pathways for funding tenured professors at universities, and instead opening it up to a wider audience of donors. Bill Gates wrote on his blog about the company’s efforts to support scientific research that would benefit developing countries. Wu highlighted several projects that have been funded through Microryza, including a paleontologist who will be doing an excavation and sharing his findings with backers along the way.

Watsi

Watsi is a particularly notable startup for Y Combinator because it’s the first (intentional, Graham noted) nonprofit startup to come through YC’s ranks. The company has built a platform where individuals can crowdfund medical treatment and surgeries for individuals, starting with a medical clinic in Nepal but quickly growing to other locations. So far, the site is now funding treatments for up to 17 patients per week.