Mark Rostick from Intel Capital and I were invited to speak at NC Spark last night. This is a group of local entrepreneurs that have been getting together once a month for networking, peer support and mentoring. It consists mostly of founders and CEOs of startup companies. I think the group has been around for 3 years and was started by Glen Caplan at Hutchison Law Group and Adam Smith at Square 1 Bank. The group has grown in size over time.
We met at Square 1 Bank last night in Durham and I think maybe 20-25 people attended. Here are just two of the topics entrepreneurs asked about:
Current fundraising environment. Yep, it is always hard to raise money (even during great times). But my advice to the entrepreneurs in the room was to make sure they target investors out of the region that have shown interest investing here. That list is actually pretty big. For some reason, I think too many people try knocking on the few doors of VCs just here in NC or in the Southeast - which can be very limiting. If they can't raise money from that smaller group, then they get frustrated, give up and tell everyone how it is impossible to raise capital. But there are a lot of VCs in the Mid-Atlantic area and Boston area that come down regularly anyway. So make sure you find out who they are, see how you match up to their criteria and include the right ones on your list. Its pretty easy to figure out who comes here. Just look at companies in the area that are VC backed. Who sits on their board? They are coming here at least once/quarter for board meetings anyway.
Senator Chris Dodd's Banking Bill: If you are trying to raise money from angels or if you are angel investor, make sure you see and understand how this could impact you. Actually, this directly impacts VCs like us too since all of our companies have raised capital from angels.
In short, this bill includes a proposal changing the qualification for an accredited investor and also adds a SEC filing for startups that want to raise money with a 120 day waiting period. If you more want some background, Fred does a nice job summarizing it including a link to the bill itself. Like everyone else I have talked to about this, I think the impact could be awful. I read howthis could eliminate almost 80% of angel investors.
This doesn't make a lot of sense to me at all, but I will be shocked if this bill pass under its current form.
Thanks again to Glen and Adam for inviting me last night. I enjoyed meeting a lot of new people and re-connecting with a few others. If you're interested in learning more about this group, email me - jason AT southcap.com and I will connect you to Adam and Glen.
