A Star Among TechStars -- Specialty Foods Web Site Foodzie

This was a good day to be one of the startups funded by TechStars, the Colorado-based incubator. Not only did a dozen of the newest proteges get to strut their stuff in front of potential investors in Mountain View, but two of them got their exits before the demos started.

Automattic, the makers of the WordPress blog system, bought Intense Debate, which makes a blog commenting system (a la Y Combinator protege Disqus). And ShareThis bought MadKast, which makes widgets that let you share links with friends from a bunch of different link-sharing sites (digg, reddit, etc.). That's the third exit for a TechStars company in recent months -- in August, AOL bought SocialThing, a FriendFeed-like social network aggregator.

But if we had money to burn, the TechStars company we'd want to invest in would be Foodzie – an e-commerce site that sells specialty foods from independent producers across the country. Most of these small producers can't make enough to meet the demands of stores like Whole Foods and Trader Joe’s, so they’re stuck trying to sell on their own. Foodzie puts them on a site with other independent sellers, so foodies have a one-stop shop of sorts, where they can buy things like these organic chocolate-coated candied lemons, or these gourmet popcorn kernels.

So yes, it's an e-commerce play, and they're not reinventing the wheel. That's OK: There's nothing wrong with using a model that works. The company leaving distribution up to the sellers, providing them with shipping labels and keeping track of the shipments. They take a 20% commission on every sale, as well as a $0.60 transaction fee on every purchase. That sounds a lot more promising to us than, say, hoping advertisers finally start flocking to social networks.

Pic from Seth Ellis Chocolatier on Foodzie.com

See Also:
Who Are This Year's Y Combinator Winners?