Montana’s Robust Startup Scene

Paul Jones, co-chair of Venture Best, the venture capital practice group at Michael Best, has been selected as a regular contributor of OnRamp Labs, a Milwaukee Journal Sentinel blog covering start-ups and other Wisconsin technology news. Paul’s most recently contributed piece, “Montana’s Robust Startup Scene” can be found under their Business Tab in the Business Blog section: Click here to view his latest blog.

A short excerpt can be found below:

“Folks at the Kauffman Foundation – one of the more credible of the various organizations that track entrepreneurship activities across America – recently ranked the various states in terms of the strength of their entrepreneurial sectors. As gener8tor’s Joe Kirgues wryly noted, “at least Wisconsin finished in the top 50.” Which is to say, 50th.

I must say I am not a huge fan of these kinds of rankings. Frankly any ranking of this sort that doesn’t have Northern California at the top of the list is more than a little suspect. Still, by chance I happened to be in Missoula Montana last week, working with several startups at Montana Technology Enterprise Center, or MonTEC, the University of Montana’s technology accelerator. That Montana. The Montana that Kauffman put at the top of its list of states ranked by the strength of their entrepreneurial sectors.

In a lot of ways, Montana is a lot like Wisconsin, only more so. It is hard to get to. The climate is challenging. Not a lot of people live there. And there are no big cities (in fact, there are no cities as “big” as Green Bay). There is just one institutional venture capital investor. It’s fair to say, I think, that Montana’s challenges, in terms of building a high impact entrepreneurship sector, are even more formidable than those facing Wisconsin.”

Click here to read more.

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Dilution Made Bill Gates Rich

Paul Jones, co-chair of Venture Best, the venture capital practice group at Michael Best, has been selected as a regular contributor of OnRamp Labs, a Milwaukee Journal Sentinel blog covering start-ups and other Wisconsin technology news. Paul’s most recent contributed piece, “Dilution Made Bill Gates Rich,” can be found under their Business Tab in the Business Blog section: Click here to view his latest blog.

A short excerpt can be found below:

Dilution is one of those words that makes most entrepreneurs nervous. And that’s no wonder. A diluted entrepreneur, by definition, is an entrepreneur who owns a smaller piece of her company after some event (like selling more shares, or setting aside more shares for employees) than she did before that event. You don’t need to be a very bright bulb to see that owning a smaller piece of something is not as good as owning a bigger piece. Ergo, dilution is a bad thing.” Click here to read more.

Big Unicorn Limps to Exit Window

Paul Jones, co-chair of Venture Best, the venture capital practice group at Michael Best, has been selected as a regular contributor of OnRamp Labs, a Milwaukee Journal Sentinel blog covering start-ups and other Wisconsin technology news.

Paul’s most recent contributed piece, “Big Unicorn Limps to Exit Window,” can be found under their Business Tab in the Business Blog section: Click here to view his latest blog.

A short excerpt can be found below:

There’s been a lot of speculation lately about the growing herd of Unicorns wandering about the venture capital landscape. More specifically, when and how were they going to find the exit windows and move on to the real world of public markets and scrutiny? Well, exciting news today: one of the higher profile Unicorns, Square, is going public! And just to make the event even more interesting, it is doing so at a price lower than its last venture round; perhaps even lower (though not by much) than the round before that. And the investors in the last private round have antidilution protection and so will see their own holdings topped off in the IPO. Click here to read the latest entry.

Convertible Debt: A Tool, Not a Panacea

Paul Jones, co-chair of Venture Best, the venture capital practice group at Michael Best, has been selected as a regular contributor of OnRamp Labs, a Milwaukee Journal Sentinel blog covering start-ups and other Wisconsin technology news.

Paul’s most recent contributed piece, “Convertible Debt: A Tool, Not a Panacea,” can be found under their Business Tab in the Business Blog section: Click here to view his latest blog.

A short excerpt can be found below:

Convertible debt with an equity kicker – these days usually a discount on the conversion price – has been a part of the venture capital landscape for as long as I have been in the space, which takes it back thirty some years.  In the beginning, it was used mostly in the context of bridging a company cash for several days or maybe weeks while the company and its investors tackled the complexities of moving money and documents around when FedEx was in its infancy, fax machines with crinkly paper were costly and unreliable, and word processing was a cost center run more or less like the typing pools of the 1950s.

More recently, the convertible debt structure (and its cousin, convertible equity) has been adapted to seed stage financings, mostly as a way for investors and entrepreneurs to keep costs down and avoid talking about the elephant at the negotiating table – valuation.  And for good reason: with the right facts, a modest convertible debt deal can be a great way to move a company from the back-of-the-envelope hypothetical stage to the ready-for-serious-capital launch phase. Click here to read the latest entry.

Tips for Entrepreneurs Seeking Venture Capital in Flyover Country

Paul Jones, co-chair of Venture Best, the venture capital practice group at Michael Best, is a regular contributor of OnRamp Labs, the Milwaukee Journal Sentinel‘s blog covering start-ups and other Wisconsin technology news.

Paul’s most recent contributed piece “Tips for Entrepreneurs Seeking Venture Capital in Flyover Country” can be found under their Business Tab in the Business Blog section.

Here is a short excerpt: “Entrepreneurs outside the major venture capital centers – let’s call them entrepreneurs in flyover country – face the same challenges their peers in Silicon Valley face, e.g. avoid cold calls, don’t expect to get an NDA, focus on venture investors in your space, etc. Flyover country entrepreneurs face some additional challenges, as well. Herewith, some tips for flyover country entrepreneurs looking for venture capital.

Home Run Hitters Take Home Run Swings

Paul Jones, co-chair of Venture Best, the venture capital practice group at Michael Best, has been selected as a regular contributor of OnRamp Labs, the newest blog addition to the Milwaukee Journal Sentinel covering start-ups and other Wisconsin technology news.

Paul’s most recent contributed piece “Home Run Hitters Take Home Run Swings” can be found under their Business Tab in the Business Blog section. Click here to view his latest blog.

Here is a short excerpt:

“Entrepreneurs outside of the major venture centers generally have fewer financing options than their venture center counterparts. Investors are scarce, farther apart, and have shallower pockets. Understandably, this makes many of these entrepreneurs very careful about controlling their burn rate. Which is good. Well, mostly.

Being frugal has obvious advantages for entrepreneurs with limited access to deep-pocketed venture capital resources. Most startups that fail do so when they run out of money (though – a topic for other places – in my experience the proximate cause of running out of money is usually management-related). Ergo, spending less prolongs survival which, all other things being equal, increases the chances for success.

Alas, all other things are not equal. The problem with the “save money to succeed” model is that most entrepreneurs who hit home runs do it by taking big swings: which is to say, among other things, that when the right pitch comes along they go after it with everything they have. Wait for the pitch, of course: but when you see it swing away. There is, to try another metaphor, a time to cut bait and a time to fish.”

Click here to read more of Paul Jones’ OnRamp Labs blog post located under the Business tab of the Milwaukee Journal Sentinel’s website, www.jsonline.com.

Follow the Herd: To Delaware

Paul Jones, co-chair of Venture Best, the venture capital practice group at Michael Best, has been selected as a regular contributor of OnRamp Labs, the newest blog addition to the Milwaukee Journal Sentinel covering start-ups and other Wisconsin technology news.

Paul’s most recent contributed piece “Follow the Herd: To Delaware” can be found under their Business Tab in the Business Blog section. Click here to view his latest blog.

Here is a short excerpt: “For such a small state, Delaware casts a long shadow in the world of business. More than one-half of Fortune 500 companies, publicly-traded companies, and US domiciled companies generally are incorporated in Delaware. If you are a high impact entrepreneur with ambitions to create a business with national and maybe even an international footprint, that information alone should get you thinking about incorporating your business in Delaware. That said, if you are curious about why Delaware is such a popular hangout for American business, herewith some of those reasons….” Click here to read more of Paul Jones’ OnRamp Labs blog post located under the Business tab of the Milwaukee Journal Sentinel’s website, www.jsonline.com.