October’s meeting of the Rockies Venture Club saw high attendance to discuss sources of funding outside of traditional venture capital. Before the panel discussion, three companies had the chance to make their pitches to the audience. Dynamic Solutions and Systems provides a variety of training, educational products, and software tools to support real estate investors. The company seeks to be a one-stop resource for those involved in real estate and is currently seeking investment for customer acquisition.
Brian Smith of GoSmart Technologies then took the stage to present his companiy’s charging stations for plug-in electric vehicles. The stations are suited for residential, commercial, or urban use. Among the differentiators for GoSmart compared to competing charging stations are a touch screen interface, branding capabilities for businesses using the stations, and a membership program for users to earn rewards.
The final company presentation of the evening was offered by Matthew Roselle of RoseBrook Patient Finance. The company plans to offer patient financing for procedures not usually covered by insurance, beginning with orthodontic offices and expanding to other dental and medical practices. Through its RoseBrook Financing arm the company will also offer practice management solutions to dentists and physicians. The company’s model is based on the successes of Dr. James J. TenBrook, who employed similar methods in his orthodontic practice. The company is currently seeking growth capital and capital to fund patient loans.
A panel discussion covering financing options before venture capital concluded the evening. The panelists were:
- Moderator- Dave DuPont, CEO of TeamSnap, Inc.
- Tim Bour, Executive Director of the Boulder Innovation Center
- Julie Lerner, Managing Partner at Golden Seeds
- Jim Pollock, CFO of aWhere
- Jack Tankersley, Meritage Funds
The panel openned with the lone venture capitalist on stage, Jack Tankersley commenting that a recent study showed 84% of the companies on Inc’s list of the 500 fastest growing companies for the past ten years never raised venture capital. As such, Tankersley noted companies should begin with the premise that they do not need professional investment. Tim Bour, who witnesses many deals from his position at the BIC, noted the most common funding path is first money from friends and family followed by an angel round when growth goes “beyond a company’s capacity.” Several panelists commented that a company must have a prototype and a few initial customers before angels show interest. Pollock noted that attractiveness of financiers who are willing to “provide money for something else [other than financial ROI]“. Included is this group are customers and distributors.
Tankersly and Lerner both commented on the increasing responsibility that taking on angel investment requires. Tankersley noted that all investors come with “non rate of return needs,” for example providing financial reports. Lerner commented on the need to evaluate early some of the less exciting parts of the business’ financial structure -including the equity options pool – to be prepared for investment. The panel was also in agreement on the need for a warm introduction whenever approaching an angel group or non-familiar investor.
Rockies Venture Club (RVC) was one of the first non-profit organizations in the country to help entrepreneurs launch and manage high-growth potential companies. Founded in 1985, RVC is the Rocky Mountain Region’s premier networking organization that connects entrepreneurs, service professionals, investors, venture capitalists and other funding sources. The organization will host its 3rd annual Angel Capital Summit on November 17.
