Wednesday, December 10, 2008
Posted by JumpStart Team
It’s coming up on year end, and you know what that means? Eggnog and fruitcake? Champagne headaches? Resolutions to lose weight and become a better person? Yes, but that’s not what I’m here to blog about. What year-end means to me (in the blogosphere, anyhow) is that it’s time to report your 2008 Northeast Ohio company seed, angel and venture capital investments, folks! So, here’s the direct plea. Entrepreneurs and investors alike: won’t you please report the funds you’ve raised and/or the equity investments you’ve made in companies (pre-seed, seed, early stage, and growth) to the different national investment databases (VentureSource and/or VentureXpert)? Reporting is a dull and boring activity, I know (trust me, I know). But you wanna know what is exciting? The investments information that you report is ultimately aggregated and conveyed en masse to a national market and that national market does note which regions have the best angel and venture capital investment numbers. If Northeast Ohio investments are consistently stable or even growing, then people start to take notice (as they have been doing--numerous venture funds have set up offices in Northeast Ohio over the past two years, and several more existing funds have raised additional capital).
We know from our own tracking that even in this economy, a good number of angel and venture capital investments are being made in Northeast Ohio (this year-to-date is off last year-to-date moderately but not dramatically). Last year, the number the NorTech Venture Capital Advisory Task Force tracked was $318 million--a strong number. But the national databases only had a fraction of that number for Northeast Ohio. So, we know that somehow the investments aren’t being picked up in the databases, and this year the actual vs. reported disconnect is even worse so far. Whether the reason is that investors in Northeast Ohio are underreporting or the databases are under tracking, we don’t know. So, until we know more, won’t you please report?
The databases are important because they serve numerous investing industry news sources. The databases are analyzed to determine which regions and cities in the Midwest have the most early-stage investment capital. Northeast Ohio usually ranks fairly well in the Midwest -- often just behind Minneapolis and maybe Chicago -- but it’s not easy getting there and it could rank even higher if more of the actual investments that really occurred were tracked. What we want to do over the coming years with this investing information is confirm that the funding environment in Northeast Ohio continues its upward trend, communicate it to the rest of the world, and remove all doubt about that long-term trend. The scores of innovative companies and their leaders are without any doubt what have compelled investors to invest more and more money in Northeast Ohio companies. But a generally upward trend that shows the capital continuum strong and thriving over a span of years is what will continue to get them back here, investing even more risk capital, setting up offices, and creating a buzz about the region.
So, overworked entrepreneurs and investors alike, get your priorities right. Fruitcake can wait. Target is open late. The kids haven’t seen you for the past year, so really now, what’s ten more minutes? Instead, take a moment and report. Here’s how – compile the following information and send it to us (and we'll send it to the databases, or we can happily give you the contact info. for the databases):
Company name and key contact information, Company, website, CEO, address, total investment amount, total round amount, investor(s), type of investment (equity, debt, other), stage of investment (pre-seed, seed, Series A, B, C), date investment closed.
If you don’t have time to write it down and send to us and/or the databases, here’s a deal you can’t refuse: just give me a call and I will take down the information and do the reporting for you (just call our main number--216.363.3400--and ask for me).
(PS: There is an option in the databases for certain of your company information to remain confidential and for it just to get aggregated into larger numbers.)
Becca Braun is a past president of JumpStart Ventures. She founded and led a number of early-stage companies and organizations, as well as worked as a private equity investor and management consultant. She received her MBA from Harvard Business School and her BA in Linguistics from Harvard University. She is keenly interested in the intersection of wealth creation and broad-based regional economic growth.