Football Tech Startup GoRout Lands $1M in Seed Financing, New City Loan
GoRout LLC, a buzzworthy Rochester-based football technology startup that began as a tenant in the Mayo Clinic Business Accelerator, has raised $1 million in a seed financing round and is growing quickly, according to city leaders.
GoRout was founded in 2013 in the Mayo Clinic Business Accelerator by CEO Mike Rolih. Its communications technology for football teams is like a wearable smartphone: During practices, players sport a shockproof digital display on their forearms, enabling coaches to eliminate huddles and thus maximize their practice time, reduce mistakes and improve communication.
The wearable displays come in a padded protective belt and boast a military-grade certification ensuring their durability and water resistance.
At the Mayo business incubator, Rolih grew the idea from concept to prototype. Then in 2015 the young firm moved to offices on 3rd Street Southwest. That same year, it landed angel financing from the Southern Minnesota Initiative Foundation and its Southern Minnesota Equity Fund, as well as a $75,000 city-financed loan arranged by Rochester Area Economic Development Inc. (RAEDI), the local nonprofit business development agency.
RAEDI, which operates the city-funded Rochester Economic Development Fund, revealed in July that GoRout has since paid back the loan with interest while also completing a $1 million seed investment round led by Chicago-based Kovitz Investment Group, a wealth management firm with $2.7 billion in assets.
The young company earned considerable buzz in 2017 when it was named one of the winners of the NFL’s “1st and Future” competition, established by the league to promote startups seeking to commercialize technology designed to make the game safer in the wake of its well-publicized concussion issues. The Mayo Clinic is one of the NFL’s lead sponsors in the 1st and Future effort.
RAEDI reported that GoRout is also quickly growing its revenues as more football teams sign up for its on-field communications system. Its revenues have increased each year: In its launch year of 2015, revenues were $30,000; this year they are expected to reach $500,000, putting the firm “almost at the break-even point.” The company has signed up 50 users for upcoming season, with 60 projected for the full year.
RAEDI released the information about GoRout late last month as it pitched the Rochester City Council on a second and much larger loan from the city’s economic development fund – this time for $250,000. Council members voted unanimously to do so at their July 23 meeting, agreeing with RAEDI that with only 1 percent of the football market covered so far, GoRout has considerable potential for growth.
Currently GoRout employs four full-time, one part-time and 11 seasonal employees. Proceeds from the city loan will be used to expand operations; develop a new product, identified as “on field-mixed reality training”; and create up to three new Rochester jobs immediately.
Ultimately, RAEDI said, GoRout aims to expand its Rochester footprint to up to 30 jobs by 2021-22.