Seems like my Twitter stream was full of references to this angel investor infographic from Investor Pitches (they build pitch decks). The most interesting thing to me is that an angel's average net worth was a lot more than $750k.
This Thursday night at 6:00 is Entrepreneurs' Night. It is my ADTC swan song, and it's going to be a good one. In May we shaking things up a bit and having several Atlanta angel groups present what they are looking for in their deals. I call it the Angel Editon.
Each of these folks will be given 5 timed minutes to present followed by 5 timed minutes of Q & A. Kinda turning the tables a bit. This is the first time that Sig will be talking about Flashpoint Ventures in public. Flashpoint just began accepeting applications today.
This event is open to all enterpreneurs. We would love to see you there. If you plan to attend please register.
Last night was the monthly meeting of the Atlanta Technology Angels. It is the first ATA meeting I have had an opportunity to attend since Mike Eckert became chairman and executive director of the group. And oh my gosh what I difference. To give you some flavor the last ATA meeting I attended in Q3 of 2010 had about 20 angels in attendance. Last night close to 50. And they are getting active.
You may have read about ATA investing in HireIQ. In addition to that deal ATA currently has a term sheet signed, is in due diligence with another company, and has some individual investors moving forward with a third deal. Moreover ATA has already completed three follow on rounds in 2011. Of the four new deals mentioned above, two of them are seed stage investments in pre-product companies.
On top of all this activity one of the most interesting things to watch during the meeting was angels championing startups that pitched. Very passionate support for entrepreneurs.
As part of its evolution ATA has constructed three different deal types that they are interested in pursuing.
One are seed deals. To ATA a seed deal is a $100k or less round into a large well supported market, with a clear understanding of competitive advantage, a preliminary business model, and a team. A member of ATA or other early stage entrepreneur support entities such as atdc must champion seed stage deals. Part of my day job at atdc is to refer the best seed stage deal I see to ATA every month (one of them is in due diligence).
Two are core deals. Core deals are your more historically typical angel deals in the $250k to $1 million range. For core deals ATA is looking for early market traction in a sizable market, an experienced management team with domain knowledge, an exit strategy to liquidation within five years, and a valuation no higher than $3 million.
Three are opportunistic deals. Opportunistic deals are exactly that. As an example I recently discussed a company with Mike Eckert that was raising $1 million on a $9 million valuation. The company has significant revenue traction so Mike met with the CEO to determine if it was a potential fit.
ATA has taken the step to put their investing criteria online. They have also put their seed and core applications online. They are below.
The Atlanta Technology Angels are resurrecting themselves. They are becoming a source of capital that any entrepreneur seeking early investment should consider for one simple reason. They are doing deals.
So I was doing some work on the atdc Startup Showcase that resulted in a quick brainstorming session on Atlanta area organizations that fund technology startups. It looked something like this.
The venture capital firms are Arcapita, BLH Ventures, Buckhead Investment Group, Fulcrum, H.I.G., Kinetic, Noro Moseley, Total Technology Ventures, TechOperators, and Value Plus Ventures. The more angel oriented investor groups include Atlanta Technology Angels, CEO Ventures, the Communications Group, Hamilton Ventures, Profounder, Seraph Group, and Shotput Ventures.
Though they are no longer actively investing in new deals there is of course Imlay Investments. You can add the ATDC Seed Fund and the Georgia Tech Edison Fund to the list as well. There is a total of 20 investment entities . Of the 20 at least 13 are active, having done at least one deal in the past year.
While we can use more this is Atlanta in 2011. It would behoove any entrepreneur that thinks external funding is in their future to do their homework and get to know these firms better.
Update: I was reminded that I omitted Paparelli Ventures.
Shortly after posting I recevieved an email from Merrick Furst. Merrick is a co-founder of Damballa, teachs an undergrad entrepreneurial class out of Georgia Tech's College of Computing, and is managing director of Profounder, a seed-stage investment company in which I am a partner. With a simple FYI at the beginning this is the content of his note.
Ohio Launches Tech Incubator With Fund Led By Sequoia's Kvamme
The state of Ohio is adopting a tech incubator model that has been successful for others, such as Y-Combinator and TechStars, in an initiative to inspire new business ideas and grow the state's economy.
Ohio State University's Fisher College Center for Entrepreneurship has launched 10x, an accelerator focused on the professional development of young, technology entrepreneurs. The program is made possible through capital provided by Ohio's New Entrepreneurs Fund.
The ONE Fund initiative is being spearheaded by Mark Kvamme, director of job creation for Ohio. Kvamme is also a partner at Sequoia Capital who was recruited to head JobsOhio, Gov. John Kasich's new private, economic-development corporation.
Young entrepreneurial teams will compete for 10 spots that will each receive $20,000 for business and living expenses during the 11-week development program.
NCT Ventures, a Columbus, Ohio-based venture capital firm, has already guaranteed that one team to graduate the inaugural 10x program will receive $200,000 in follow-on funding to further pursue its venture.
The participants must agree to live in Ohio for the duration of the program, and any company formed through the program must be set up in Ohio. The teams will have access to all the resources provided by the Center for Entrepreneurship, ONE Fund, NCT Ventures and the start-up community in central Ohio.
"It's a robust environment, more than you would expect from your typical Midwestern town," said Michael Camp, executive director of Center for Entrepreneurship, in Columbus, and the architect of the 10x program. "The notion that place defines how big or good a business can be is out the window."
During my time at atdc I have had two high-level strategic insights of note.
The first occurred back in 2007. I came to believe that atdc needed be more open and reach out to better serve concept and seed stage startups. This, in part, led to the strategic shift atdc began in the summer of 2009.
The second occured this week. Some entity with staying power needs to step up and systematically tackle the lack of seed and early stage funding in Georgia. To architect a program like Michael Camp put together in Ohio. A state fund, big venture capital leadership, a robust program to vet startups, and local angel/venture capital involvement.
That in, 500 words or less, is what I mean by ownership.
I suspect that if some professor where to invite Mr. Blank to Georgia Tech he would have many of the same observations and the challenges would be the same and as equally apparent. Those challenges being the lack of venture capital (this includes angel funding) and the lack of a startup culture. I have never been to Ann Arbor but I suspect that Atlanta's startup culture is a bit stronger than that of Ann Arbor. Regardless Steve states that an influx of venture capital will solve the startup culture problem. Perhaps he is right. But the interesting thing (Steve says so himself) is this.
The interesting thing is that no one seems to own the problem. The University of Michigan tech transfer office has an incubator but 1) mixes software, hardware, med devices and life sciences deals in the same program, and 2) takes no ownership of figuring out how to get a risk capital ecosystem in place. Surprisingly, the same with the entrepreneuship center in the Business School. I would have thought they’d be leading the charge.
Cut University of Michigan and paste Georgia Tech and the paragraph holds true. The closest I have seen to anyone taking ownership is Venture Atlanta, with a hat tip to Morris Manning & Martin and DLA Piper for making an effort to get outside venture capital to invest in Atlanta startups.
But the really truly most interesting thing is that I believe the paragraph above is a prescription on what Georgia Tech and ATDC need to do to drive technology enterpreneurship in Atlanta and Georgia. Stop mixing software, hardware, medical devices, life sciences, and cleantech in the same program. Start taking ownership of figuring out how to get a strong risk capital ecosystem in place. Expand beyond helping entrepreneurs launch and build successful companies. Be on a mission to create a strong innovation cluster.
We are so close. It is so obvious. It would be a shame if we did not make it happen.
The competition takes place over the period of four months, and qualified applicants receive publicity, mentors and the opportunity to present their business plans on several occasions to groups of judges comprised of influencers and investors in the community. If you want to get hooked into the Atlanta technology startup scene this is a great way to do it.
I participated back in 2006 as an entrepreneur. It was a great experience that forced me to meet some milestones in the business. For the past three years I have been heavily involved with the competition as a member of the task force and leading the screening team. This is a great program.
The competition culminates with a final competition where the three or four companies will present their business to a panel of seasoned entrepreneurs, venture capitalists, and angel investors from around the country. The winner walks away with $50,000 in cash and $150,000 in a personalized suite of services.
You can read more about how to apply here. Preliminary applications are due February 17.
On Friday night about 110 people in a geek dominated crowd walked through the doors of ATDC. About 50 entrepreneurs stood up and pitched their concepts in 60 seconds. This was whittled down to about 25 for a second round from which 12 projects emerged. Teams were formed and after a weekend of coding, food, beverages, and more geek humor than one can stand, the team leaders got up to talk about their applications and what they accomplished. Here is a quick run down in the order they took the podium.
C4 Atlanta. A rogue project that did not pitch on Friday night. C4 is building an arts service platform to empower artists and arts organizations. They built an app store for artists over the weekend. You can take a peek at a special version with some of the applications of the Start Atlanta companies here.
Minglle. An opt-in sms-based meeting utility to make new connections based on common interests. Stealing from Stephen Fleming, it's FourSquare meets LinkedIn. Presentation started out great until the demo blew up.
Ask One Question. Simple one question email/sms surveys with instant feedback. Great design. Nice demo. Reasonable business model.
Reach Me Later. A sms-based mobile application auto-responder to prevent driving distractions, with analytic capabilities. Concept was the brain child of Georgia Tech third year senior (which means it only took her two year to become a senior) Joy Buolamwini. This is not a make in a weekend app but they did a nice demo.
ConnectMe. A Facebook dating application that connects people based on their rich profile preferences. Liked this one when it was pitched on Friday night. I sat with them a bit as they were building this thing. The info that an app can pull out of your Facebook profile is astonishing.
Swipemotion. Painless gesture based publishing for enterprises. Nice concept.
JayTalker. Netflix behavior pushed to Facebook and Twitter. App is live. And yes there is a business model.
TripLingo. Mobile/web application that generates custom linguistics platform for specific destinations. Entrepreneur Jesse Maddox is going full-time on the project.
Cineminder. Application to remind you when movies that you want to see hits the theaters, DVD/Bluray distribution, Netflix and the like. Application is live. Concept from Tim Dorr who sold A Small Orange for a big chunk of change.
FindTime. Serverless iOS app that integrates with calendar apps to automatically assign time to complete tasks. Got the app to live demo.
Mark It Eight Dude. A Smartphone app to capture bowling statistics with numerous external variables including alcohol consumption.
Repulicious. Another rogue project. A searchable listing of reputable designers, developers, and marketers for your startup projects.
The projects did darn well. Five have a live product of some sorts and there were four demos. Good stuff. Atlanta knows how to do a weekend startup hackathon. TripLingo won the vote for best startup. Cineminder earned my vote.
The quality of the people walking in the door to participate in these weekend marathons increases every year. More people that can contribute are making the scene. That is not too surprising. What was surprising was the effect a tweak the StartAtlanta team made to the weekend.
They invited mentors. I am going to tell you something right now, it is really difficult to get a bunch of people driving toward a launch to sit down with a mentor.But it happened. And the mentors, which in some circles is code for angels and those that are connected to angels, hung around or came back for the Sunday night presentations (something that has not happened much in the past).
And guess what? The angely mentors liked it. They liked it alot. Requests for StartAtlanta to happen more than once a year. Interest in follow up advising roles. Talk of investing. Good stuff. We are building bridges and mixing the types. Kudos to the StartAtlanta team. They succeeded in their quest of "building something even better." Passing the torch was the right thing to do.
What started back in 2007 as an effort to build Atlanta's technology startup community is evolving. After four years it seems to not only be taking hold but building momentum. With that momentum things will continue to change. Perhaps change into something that is much more than a weekend community building experience.
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