This is the third in a series of profiles on the first four women to be mentored by SOAR, a new Triangle area organization to help female entrepreneurs raise capital and grow their companies. SOAR is funded by Google for Entrepreneurs as part of its #40Forward initiative to support women in startups.
Melissa DeRosier is a clinical psychologist who moonlights as a gamer, an author and a CEO.
DeRosier fits no stereotype. That’s because she’ll do whatever it takes to accomplish a single mission – to change the lives of kids with mental, social and behavioral issues. The work of her 75 clinical researchers, game and software developers and designers at the Cary-based 3C Institute, the $30 million she’s raised in federal research grants and two authored books are all rallied around that cause.
Now, she’ll apply her passion in a new way as founder and chief scientific officer of Adaptive Health Systems, a startup she’s spinning out of the Institute to bring to market its research-based web games and curricula. With the help of SOAR, she’ll learn valuable skills about marketing and sales and how to structure the new company. But most of all, she believes the organization will help her raise the investment dollars required to get these games on the screens of families and teachers around the world.
“She was very intriguing to us,” says Lauren Whitehurst, one of two SOAR mentors helping DeRosier. “She’s clearly already running an interesting business. And her product has the advantage in that it’s a highly researched game and only she has that research capability.”
Merging research with practice.
DeRosier, who earned a PhD in clinical psychology from the University of North Carolina at Chapel Hill, began her career with a grant from the National Institutes of Health to develop Wake County Public Schools’ first social skills training program to counteract bullying.
In her doctoral research, she’d noticed a gap in training materials for teachers and administrators. There were beautifully-designed products that weren’t backed by any evidence. And the evidence-based curricula developed by researchers like DeRosier were stuck in research reports and medical journals. “You need to do both,” she says, and she made it her mission to bridge the research-to-practice gap, starting her company in 2001.
DeRosier’s first program was called S.S.GRIN. It was a 10-week program for 3rd to 5th graders, teaching them skills like how to initiate conversations, think before acting and compromise. It was meant to happen in small group settings and with a price tag of $80 per week per student. Though DeRosier got the curriculum in dozens of school systems around the nation, including Chicago Public Schools, she had some challenges.
The curriculum was expensive. It required time and scheduling and staffing. And those all proved barriers to helping as many children as possible benefit from it.
She also saw the popularity of gaming and the increasing use of technology in the classroom and at home for educational purposes. So in 2006, she partnered up with James Lester, a computer science professor and an international expert in artificial intelligence and learning technologies at North Carolina State University, and learned how game technologies worked. 3C then secured more government funding – $5 million to create an online game version of the S.S.GRIN, which takes kids on a journey on Pacifico Island, and a second game called Zoo U, set at a school for future zookeepers.
“Kids encounter social problems along the way and use skills to navigate the island,” DeRosier says. “It has all the elements of an adventure game but kids can’t help but learn along the way.”
Research proves it. In July, the results of a clinical trial using Adventures Aboard the S.S. Grin were published, showing that kids who complete the game over about a one-year period gain social literacy, communication skills and confidence (A previous trial for Zoo U revealed the same). 3C is also out with a new book on the subject, Social Skills Assessment Through Games: The New Best Practice, documenting the work of its researchers.
From an economic perspective, it seemed the time to produce educational games. The most recent projections by learning technology researcher Ambient Insight show the market for game-based learning hitting $2.3 billion in 2017, up from $1.5 billion in 2012.
Why a new venture?
As 3C began to distribute Zoo U to partner schools around the country – it’s in about 250 today – DeRosier recognized that the market was much broader than the school training programs 3C had created previously.
Parents and students and physicians and psychologists are also target markets for the games, and so 3C needed a robust retail and e-commerce plan in addition to a much bigger strategy around the schools.
She didn’t want the researchers and developers and designers at 3C distracted from future games in the pipeline. And she wanted to maintain the integrity of the research surrounding them – a new company could license the games once they were proven to work without any pressure on 3C to compromise the research (for design or fun or marketing power).
“We needed a company with a laser focus on getting these products into as many hands as possible,” DeRosier says. “If we tried to do it within 3C, it would dilute all efforts.”
She spent the last eight months working with business advisors to set up the new company. This summer, she named her friend from the local Entrepreneurs’ Organization group, Kyle Breischaft, its CEO. He started, raised capital and then in 2013, sold Raleigh-based Emergency Technologies Inc. (maker of management software for fire and EMS departments). They’ve closed a round of funding from friends and family to get the new company up and running.
They’ll work together, with SOAR, to create a plan for raising institutional capital in the first half of 2015. DeRosier says any venture capital to Adaptive Health Systems will be strategic. She wants money only from investors who recognize and appreciate the powerful science behind the games.
SOAR has already been helpful in other ways, DeRosier says. “Within an hour, John and Lauren already had four different ways for us to test our pricing models up on a white board,” she says. “It’s almost frightening how helpful they have been.”
The 3C/Adaptive Health Systems pipeline
This fall, 3C will complete the supplemental materials that go along with the existing two games. There will be guides for parents and teachers to help or communicate with their kids and students during the game. Adaptive Health Systems will begin to work with distribution partners, and will create an e-commerce platform for the games. DeRosier hopes to be selling nationally online soon.
Work is also happening on game three, Stories in Motion, for autistic children. It’s expected to be released next February.
In 2016 will come Hall of Heroes, a game to prepare 5th and 6th graders for middle school. Three other games are in planning stages. Adaptive Health Systems will have first right of refusal to license and distribute any games or products developed by 3C, DeRosier says.
And international expansion is likely. Already, 3C has a partner in Japan, which will translate Zoo U for children there. Future international growth will be dependent on the ability to tweak the games for both language and cultural context.
It all fits with DeRosier’s big mission – to get 3C’s games on the screens of children anywhere.
“Communication is largely the same everywhere. Being able to speak clearly and be understood. Empathy, trying to understand other people’s perspectives,” DeRosier says. “These are universal social skills we want to help all kids develop.”