Angel and Venture Capital in Northwest Ohio

Building!Company!Value
Building Company Value

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! “Third!Frontier!Program”!– Sponsored!by!the!ODOD
! Management!Services!Team
M tS i T
! Pre"Seed,!Early!Stage!Venture!Fund
! $22.5!Million!Program!financing:
$22.5 Million Program financing:
! $15.0!Million!ODOD
! $7.5!Million!Private!Investors
! Industries!of!Interest:
Industries of Interest
! Advanced/Alternative!Energy
! Advanced!Mfg!&!Materials
! Biosciences
! Information!Technologies!(Opportunistic)
! Geography!Focus!– Northwest!Ohio
g p y


Clients!Gain!
Access!to…


ADVANCED!BATTERY!CONCEPTS,!LLC


117 Startup/Seed Stage deals received $376MM (5% of total) - $3.2MM on average


! Boot!Strapping
! Friends!&!Family,!Personal!Investment
Friends & Family Personal Investment
! Angel!Investors
! Wealthy!individuals,!!and!groups
! Limited!resources
! Venture!Capital
! Seed, Early"stage and Growth phases
Seed,!Early stage!and!Growth!phases
! Geography!and/or!Industry"focused
! Others
! G tG t
Government!Grants!
! Strategic!Alliances/Partners


! An!angel!is!a!high!net"worth!individual!who!invests!his!or!her!
own!money!in!start"up!companies!in!exchange!for!an!equity!
own money in start up companies in exchange for an equity
share!of!the!businesses.!!
! Many!angels!are!former!entrepreneurs!themselves.!
! Invest!to!gain!a!return!on!their!money.
! Participate!in!the!entrepreneurial!process.
! Often!to!give!back!to!their!communities!by!catalyzing!economic!growth.!
! Angels!tend!to!invest!in!companies!that!are!located!near!them!regionally.
! Seek!a!liquidity!event!in!4"8!years.
! Individual angels may join with other angels to invest
Individual!angels!may!join!with!other!angels!to!invest!
collectively!as!a!group.


! Money!provided!by!professionals!who!invest!alongside!
management!in!young,!rapidly!growing!companies!that!have!
management in young rapidly growing companies that have
the!potential!to!develop!into!significant!economic!contributors.
! Venture!Capitalists!generally:
! Finance!new!and!rapidly!growing!companies.!
! Purchase!equity!securities.
! p p
Assist!in!the!development!of!new!products!or!services.!
! Add!value!to!the!company!through!active!participation.!
! Take!higher!risks!with!the!expectation!of!higher!rewards.!
! Seek a liquidity event in 3"5 years.
Seek!a!liquidity!event!in!3 5!years.


! While!both!invest!in!entrepreneurial!firms!and!take!equity!
(ownership)!in!those!businesses,!there!are!some!important!
(ownership) in those businesses there are some important
differences:!
! Funding!Source!
! Angels!invest!their!own!funds!directly!in!a!business,!while!venture!
capitalists!invest!funds!from!other!sources!(e.g.!pension!funds).!
! Stage!of!Business
! In!general,!angels!invest!in!seed,!start"up!and!early"stage!businesses,!
while!venture!capitalists!invest!in!later"stage!businesses.!
! Size!of!Investment
! Venture!capitalists!generally!invest!$2!million!and!up!in!a!financing!
round,!while!individual!angels!make!much!smaller!investments!($5,000!
to!$100,000!and!most!often!larger!if!from!a!group).


! In!general,!the!best!time!to!seek!investment!funding!from!
Angels!and!VCs!is!when:!
Angels and VCs is when:
! Your!product!is!near!completion!or!developed.!
! You!can!demonstrate!market!validation!" existing!customers!or!potential!
customers!who!will!confirm!they!will!buy!from!you.!
t h ill fi th ill b f
! You!can!demonstrate!that!the!business!is!scalable!to!at!least!$15"30!
million!in!revenues.!
! Y ' i
You've!invested!your!own!dollars!and!exhausted!other!alternatives,!
t d d ll d h t d th lt ti
including!friends!and!family.!
! Your!business!plan!is!tip!top!shape.!
! Y h “ l i h”
You!have!!an!“elevator!pitch”.
! You!are!willing!to!give!up!some!ownership.


! Sample!criteria!used!to!“initially”!evaluate!your!business!idea!
include:
! Management!Team
! Market!Opportunity
! IP/Technology!– Is!it!disruptive?
/
! Faster,!Better,!Cheaper
! Stage!of!Commercialization
! Pre!or!Post!Revenue
! Funding!Requirements!
! How!much!money!do!you!need!to!reach!a!liquidity!event?
y y q y
! Milestones!Achieved
! Time!to!Exit
! Amount of Cash Founders Have Contributed
Amount!of!Cash!Founders!Have!Contributed


! Initial!Investigation
! Overview!Assessment
Overview Assessment
! Discussions!with!Management
! In"depth!Investment!Assessment
! Analysis!of!Management
! Review!Intellectual!Property
! Analysis!of!Market!&!Opportunity
! Analysis!of!Operations/Business!Model
! Make!Key!Industry!Contacts
! Research!Industry!Exit/Liquidity!Activity
y / q y y
! Negotiation!of!the!Terms!of!Investment
! Estimated!Timing!" 90!to!180!Days


! Core!Network!" Toledo,!OH!
! Millstream!Angel!Club!– Findlay,!OH
Mill t A l Cl b Fi dl OH
! Akron!ARCH!Angels!" Akron,!OH!
! Ohio!TechAngels Columbus,!OH!
Ohio TechAngels " Columbus, OH
! North!Coast!Angel!Fund!" Cleveland,!OH!
! Queen!City!Angels!" Cincinnati,!OH!
! Medical!Growth!Fund!" Cleveland,!OH!
! Blue!Water!Angels!" Midland,!MI!
! First Angels Kalamazoo MI
First!Angels!" Kalamazoo,!MI!
! Grand!Angels!" Grand!Rapids,!MI!


! Plymouth!Ventures!– Toledo,!OH
! Early!Stage!Partners!– Cleveland,!OH
E l St P t Cl l d OH
! Chrysalis!Ventures!– Cleveland,!OH
! Arboretum!Ventures! Cleveland,!OH
Arboretum Ventures – Cleveland, OH
! RiverVest Venture!Partners!" Cleveland,!OH
! Reservoir!Venture!Partners!– Columbus,!OH
! NCT!Ventures!" Columbus,!OH
! Fletcher!Spaght Ventures!– Columbus,!OH
! Adena Ventures Athens OH
Ventures!– Athens,!OH
! Draper!Fisher!Jurvetson " Cincinnati,!OH
! Triathlon!Medical!Venture!Partners!– Cincinnati,!OH
,


Mike!Bogdan
Rocket!Ventures
2600!Dorr!Street
Toledo,!Ohio!43606
Voice:!!!!419.530.6084
Email:!!!!bogdan@rocketventures.org
Web: www.rocketventures.org

Rocket!Ventures!is!a!$13.5!million!venture!capital!firm!jointly!funded!by!the!Ohio!
Rocket Ventures is a $13 5 million venture capital firm jointly funded by the Ohio
Department!of!Development!and!private!investors.!In!exchange!for!an!equity!state,!
Rocket!Ventures!invests!between!$250,000!to!$750,000!in!technology"based!
companies,!requiring!seed!and!early!stage!funding,!who!are!either!located!or!have!a!
significant!presence!in!Northwest!Ohio.


Angel and Venture Capital in Northwest Ohio

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