Angel Investing, Entrepreneurship & Learning

A few weeks ago, I blogged about the launch of TechStars and mentioned that David Cohen and I were trying to figure out a way to work together.  Over a few conversations, we decided to throw together a LivePitch and Networking event for EntrepreneurshipWeek USA in Boulder, Colorado.

In 2 days, we planned the event, got a few sponsors, and we are now expecting to have around 100-200 entrepreneurs in attendance.  Here’s the idea:

• We’re accepting applications from entrepreneurs in the community to be able to pitch at the event.  We’ll probably select around 10 deals to make LivePitches to a panel of investors and the live audience.

• We’ve attracted a panel of angels to attend to judge the event and provide feedback.  The angels that have committed to attend are:

• David Cohen, Tech Stars
• David Brown, Tech Stars
• Jared Wandry, Norseman Capital
• Bob Smart
• Bill Treadwell
• And others…

• To get the audience involved, every member of the audience will receive $100 in “play money” that they can “invest” into their favorite company pitch. (by the way…this idea was the brainchild of Carolynn Duncan and Phil Burns — want to make sure that I give credit where credit is due.)

• At the end of the event, we’ll announce 2 winners — an audience favorite and an angel favorite.  The CTEK Angel Group and Holmes Roberts & Owen have joined the sponsorship club to provide prizes to the 2 winners.

Most of all, we just want to provide a fun event for the entrepreneurial community.  If you’re in CO, come check it out — it’s free.

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If you are a company in Utah, you should take advantage of this…

FundingUniverse has partnered with Grow Utah Ventures and Governor’s Office of Economic Develop to host a state-wide funding competition. An investment of $100,000 will be made in the winner of the competition. I’m seriously stoked about this.

Here are the details:

1. Any Utah-based company can apply. Applications are being accepted until March 6th.
2. 5 semi-finalists will be selected to present LIVE to the audience and a panel of angel investors at the Governor’s first-ever Economic Summit. We’ll be soliciting audience participation through Q&A and an audience vote.
3. The angels will analyze the pitches in front of the audience to provide a learning experience of the angel process.
4. Governor Huntsman will announce the winner during his keynote speech over lunch.
5. After lunch, we’ll announce the audience favorite and compare the differences with the angel’s favorite. We’ll also have a panel of angels that will be available for Q&A.

While we are still in the process of solidifying the panel of angels, here is a preliminary list of those that will participate:

- Tony Howells- Olympus Angels

- Bill Payne- Vegas Valley Angels

- Alan Hall- Olympus Angels/ Grow Utah Ventures

- Paul Campbell- Cache Valley Angels

- Ron White- Olympus Angels

- Damon Kirchmeier- UTFC

- Kent Thomas- Olympus Angels

- John Richards- Utah Angels

If interested, go to www.fundinguniverse.com/goedsummit to apply.

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FundingUniverse is a proud promoter of the entrepreneur magazine Launch. Grow Utah Ventures is the sponsor and they have done a great job to provide content that entrepreneurs will enjoy.

Check out the latest issue here.

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I’ve had quite a bit of interaction with Jeremy Neilson at the Utah Fund of Funds and I thought that it would be good to give him and the Fund a “Shout-out.”

From what I understand, the UFoF has already made 9+ investments in various venture funds that are connected to Utah.  Here’s a list of the early-stage firms that they have displayed on their website:

• vSpring Capital – an early-stage venture capital fund focusing on information technology and life sciences.
• 5AM Ventures – a seed and early-stage venture capital fund focusing on life sciences.
• Highway 12 Ventures – an early-stage venture capital fund focusing on technology and healthcare companies.
• University Opportunity Fund – an early-stage venture capital fund that co-invests alongside local and national venture capital funds.
• RWI Ventures – an early-stage capital fund focusing on technology and life science companies.

I met Phil Reed, the general partner at Highway 12 Ventures a few weeks back and he is stoked about the Utah investment market.  While their headquarters are in Boise, ID; they are anxious to get tapped into the entrepreneur and investment market here in the state.  In fact, I believe that they have already made 3-5 investments in Utah companies.

What does all of this mean?  More Money in Utah!

Props to Jeremy & the Utah Fund of Funds.  Now if we could only get them to make investments into angel funds…

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I’ve been meaning to blog about this for some time. 2 weeks ago, I attended a seminar (hosted by UTC) on “What a founder has to do to remain the CEO after raising money.” Scott Frazier, one of the most successful angel investors in the state of Utah, provided an incredibly insightful presentation. The highlights are below.

5 Tips to Raising Money

1. Give your best pitch in the first 30 seconds: The investors should know what you do and how you make money in the first 30 seconds! This is a huge problem with most pitches. Many times, the entrepreneur will get 10-20 minutes into a presentation and the investor still doesn’t understand the company or value proposition — big mistake!
2. Bring a customer when presenting: There is no one better to pitch your product than your customers.
3. Offer a personal benefit: This may seem very small, but investors love when the pitch effects them personally in a positive way. If you have a product — give it to the investors for free. Scott told about a company who turned off his angel group because they wouldn’t give the investors a free pair of sunglasses. He also told about a company that offered a free annual membership to their website for listening to the pitch and a free lifetime membership to the site for making an investment. They loved it!
4. Raise capital when capital is available: Scott was offering strategic advice to entrepreneurs on the timing of the fund raising efforts. He suggested that entrepreneurs start early so they are not desperate when pitching. He also suggested that you study out various angels & VCs to know their financial picture. For example, right now in the state of Utah… most of the VCs are in the process of raising funds so it is a bad time to approach them. As soon as they close their funds would probably be the best time to approach them.
5. Find investors with deep pockets: (yes… this seems like a no-brainer. Doesn’t every investor have deep pockets?!). The reality is that you want to work with someone that has the capability of making multiple investments in your company if needed. It’s wise to talk to your investors up front to find our their feelings on follow-on rounds before taking their money.

Scott also gave some tips on how to get the most out of your company upon exit. I’ll have to include that in a future post.

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The best thing that happened to us at FundingUniverse was our renewed drive to focus on Sales & Marketing. About 3 months ago, we were facing a very difficult situation where cash was low and we were needing to get our subscription model launched. During the previous 4-6 months, our company was very focused on research & development. We spent quality time planning and developing a compelling membership subscription, but it was time to get the product to market.

At the time (3 months ago), our team came together and made some very difficult decisions and sacrifices with the ultimate decision being that we would work harder, stay up later, and give more. What happened next was clearly remarkable: office doors began to shut (less distractions), the daily ritual of the office basketball break was soon forgotten, and the team got on the phones. It was a spectacular phenomenon: the team was taking home less yet giving more.

The decision: Focus on Sales & Marketing.

It was the best thing that ever happened to our company. Jeff and the team started rocking on the phones. We brought in a Rockstar named Jerry Khemraj. Jerry knows his stuff and helped to get things off the ground.

Results: 1. December was a record month of revenue. 2. January doubled December’s revenue.

The past couple of months have been a fantastic learning experience for my team and me. You always hear that the most successful companies are focused on sales, but it often takes some tough trials to have it really sink in. Most entrepreneurs (including me) often think that they have to have the next best mouse trap. They spend most of their time going in circles trying to make a perfect product. Don’t get me wrong — it’s important to have a solid product/service, but it’s more important to focus on sales.
February 05th 2007 Posted to Entrepreneurship, Learning

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If you are interested in learning more about angels and VCs, I found 2 blogs this week that provide great content.

1. An unknown angel investor out of Colorado has started to blog at www.5280angel.com.
2. Also, Brad Feld and Jason Mendelson (Mobius Venture Capital) have started Ask the VC blog.  The 2 of them use the blog to answer common questions that VCs get asked.

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Junto is accepting applicants for the 2007 class.  Check out the new website and new video intro.  If you are a first-time entrepreneur, I would recommend applying.
I recently started a blog entry entitled “The Skinny on the Junto Partners Program” that I will be publishing sooner than later.  It’s been a wild ride for 20 months and I’ve learned a lot.  My Junto Partners rock.

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I got an email yesterday from David Cohen, the successful entrepreneur and founder of TechStars (He found me through Jeff Barson’s blog).  TechStars — the brain-child of David, Brad Feld (Managing Director of Mobius VC), Jared Polis and David Brown — is an entrepreneur friendly summer of learning held in Boulder, CO.  Their website reads:
“TechStars brings aspiring technology founders to Boulder, Colorado for an intensive three month period, provides seed funding, education, and connections, and will result in the formation of ten new companies during the summer of 2007.”

I would love to be able to support TechStars however we can and it appears that David is also interested in the possible partnership.  The concept reminds me a lot of our Junto Partners program founded by local VC Greg Warnock, except the entrepreneurs will spend the entire summer in Boulder working on their startup idea.

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