Tag: Oklahoma Venture Forum Page 5 of 8

A profile article on Michael Basch, Nathaniel Harding, and Matt Wilson written for the Oklahoma Venture Forum on the subject of The Future of Oklahoma’s Venture Ecosystem.

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Atento Capital, Cortado Ventures, and Victorum Capital Club each have their criteria and types of companies for investments. Atento’s focus is on generating excellent risk-adjusted returns and making a lasting economic impact through stimulating entrepreneurial activity in the community. Cortado invests in capital-efficient businesses that leverage technology to scale in the Fintech, Biotech, Aerospace, Ag Tech, Energy Tech, Manufacturing, and Logistics sectors. The Victorum Capital Club is a membership network of accredited investors focused on entrepreneurship, investment, and business development to generate a return on investment and promote community and economic development. 

Basch’s advice is cash is a relative commodity for companies looking for investors.  

“I think, doing the work to understand your customer and the problem you’re solving before you raise any money where you would completely understand the problem and the willingness to pay,” said Michael Basch, Managing Partner at Atento Capital. “I think it’s doing the work on customer discovery ahead of time and not raising money for the sake of raising money but raising money. Cause you have to raise money. Not every business needs to raise money.”  

Over at Cortado Ventures, Harding said they invest in business-to-business technology that “you can put a moat around.” 

“That’s defendable where that company can either have an advantage because they have patents or either intellectual property that’s difficult to, to replicate, or their strategy involves, a key partnership with a large company that can help them scale very quickly,” said Nathaniel Harding, Managing Partner at Cortado Ventures. “There’s other ways of having a moat, besides having patents or trade secrets, but we look for defendable, unique, novel technology.” 

Victorum Capital Club works the same way as any other venture capital firm, but while they don’t currently fund, they have a network of investors from across the country they pool together. 

“Each of those investors gets to decide if they want to invest and if not, and if they do how much they want to invest, then when we have everybody’s commitments, we just group everybody together into a single entity and make an investment,” said Matt Wilson, Managing Partner at Victorum Capital Club. “Historically, venture capital has only been available to the wealthy elite pension funds, insurance companies, things like that. And what our business model does is it brings access to high-quality investment opportunities to everybody that is an accredited investor.” 

Wilson said a venture capital firm will generically tell potential companies that they look for are “team, team, team, market size, and traction.” 

“It’s a joke, but it’s a very serious point that the people are arguably the most important thing,” said Wilson. “One of the unique things about it that is particularly interesting to us and where we’ve found ourselves gravitating to is a CEO that has a real reason, like a real differentiated reason to be successful. So somebody that grew up in the industry or was the market already, like they have some unique reason that differentiates themselves from just any other guy off the street to be successful in their industry, focused on their customers, with their product, things like that.”  

People who are trying to make a quick buck, who don’t have a good sense of why they’re building their business, and don’t want to collaborate are some red flags in a CEO Basch said. Basch also watches for how they take feedback, how they respond to adversity, and how they problem-solve.  

“Don’t start a company or raise money because you want to, but do it because you have to,” said Basch. 

Harding said one of the benefits of doing business in Oklahoma is fewer gatekeepers here. 

“If you’re a first-time founder, you may not have a track record,” said Harding. “You may not have like the network or the keys to the city, but you can get meetings with the people that are going to help you, and they’re going to be willing to help you. That’s really special and powerful. I think if that is embraced and that entrepreneurs and founders know that, then they should be not afraid to reach out to people that may be able to give them great advice or they’ve had experienced that sector. If we all leverage that as a community, we can scale and grow the venture capital and entrepreneurial community much faster.”  

Michael Basch, Nathaniel Harding, and Matt Wilson will be part of a special panel discussion at the Oklahoma Venture Forum Power Lunch on Wednesday, January 12, 2022. The event will be open to guests both in-person and virtually via ZOOM.  

“You don’t have to be any particular thing to be involved in this ecosystem system and support founders and support businesses,” said Wilson. “There’s a lot of different ways to do that. And so I think everybody should find ways to be active and build the future of our state, build the future businesses that are kind, and going to drive us for the next 50 years.” 

A profile on Matt Payne written for the Oklahoma Venture Forum on the subject of The Community Effort to Grow Oklahoma’s Film Industry.

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The domino of events for Prairie Surf Media’s formation started in 2000 when Gray Frederickson moved back to Oklahoma and started the Oklahoma Film Institute. Rachel Cannon and Matt Payne were among the first of those students. The two pursued film careers outside of Oklahoma, but they eventually found themselves back in the state.

“After a little bit of chat, and discussing perhaps the idea of making a film, or writing something together, [Rachel Cannon and I] decided that maybe it would be more exciting to begin to work to add to the existing infrastructure in Oklahoma so that we could have an even more robust and thriving film community here,” said Matt Payne, co-founder and co-CEO of Prairie Surf Media. “And we’ve been doing it ever since.”

On January 1, 2021, Prairie Surf Media took over the venue, formerly known as Cox Convention Center, through a tenant agreement with the City of Oklahoma City. The venue, now known as Prairie Surf Studios, boasts five flexible, state-of-the-art soundstages with all the amenities needed to create new worlds. Payne explained soundstages are soundproof rooms where productions can build their sets, avoid outdoor elements, and shoot in a more cost-efficient way. While the former Convention is ideal for soundstages, the facility has received upgrades to better suit productions over the past several months. 

“We pulled 10,000 pounds worth of buzzy lights and old speakers out of the ceiling, replaced it with LED lights,” said Payne. “We treated the walls with soundproofing, and we built vestibules on the far end of the building so that we create a barrier, an extra door barrier between the street and the sound-stage.”

In addition to building soundstages, Prairie Surf Media worked to build up the state film incentive and the local workforce. With partnerships with OCU, Oklahoma City Community College and several career techs, including Metro Tech and Francis Tuttle, Prairie Surf Media is training people. Students learn how to work and function on an actual film set. 

“Since then, about 30 of those individuals have gone on to work on different productions in Oklahoma,” said Payne. “It’s been a really successful program, and we take a lot of pride in the fact that we’re not only bringing an industry here, but we’re that industry is creating jobs, and giving paths to kids like Rachel and I, that want to get in the entertainment industry.”

Matt Payne will be speaking at the Oklahoma Venture Forum Power Lunch on Wednesday, December 8, 2021. The event will be open to guests both in-person and virtually via ZOOM. Payne said they’ve been able to pursue this business by “standing on the shoulders of giants” from Oklahoma filmmakers such as Gray Frederickson, Lance McDaniel, and many others, including government officials.

“We’ve only been able to do this because of our partnerships with, particularly, Oklahoma City, and getting into this facility, and the state for putting an incentive in place, and state leadership, you know, Senator Roger Thompson, Chuck Hall, Representatives Fetgatter and Hill,” said Payne. “There were so many leaders that have played a role in getting us here. [Prairie Surf Media] is a very, very small start-up in a very big building, but, really, the truth is that this is a city, state, and community project that we’re all sort of proud of. And we think very much of Oklahoma as a whole, as our partner in this project.”

A profile on Devon Laney written for the Oklahoma Venture Forum on the subject of The Third Way for Economic Development.

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Coming from Birmingham, Alabama as the co-founder of Innovation Depot, one of the largest entrepreneurial support organizations in America, Devon Laney now resides in Tulsa as President and CEO of 36 Degrees North with a plan to grow entrepreneurs in the Tulsa region. Known as Tulsa’s base camp for entrepreneurs, innovators, and startups, 36 Degrees North is an entrepreneurial support organization focused on providing the resources, the community, and the programs needed to support entrepreneurs as they build, grow and scale businesses.

“When I got in Tulsa, we had two locations,” said Devon Laney. “We had about a 12,000 square foot co-working space, and then we had about an 8,000 square foot hybrid of co-working and small office space. I got here, and we put together a five-year plan and began to think about what we were going to be down the road.”

The first piece of that plan involved building and launching a large technology incubator focused on supporting early-stage technology startup companies and companies making a technology product or service that they can scale and grow and raise capital. In September 2021, 36 Degrees North opened its 50,000 square foot high-tech incubator.

While co-working spaces are an essential piece of the ecosystem, Laney said it’s not the only thing one should have in an ecosystem. While co-working is excellent for individuals, co-working spaces aren’t conducive to people trying to grow a business.

“An incubator is built for growing businesses, to support growing businesses,” said Laney. “It’s not just about one individual membership, and I’m going to charge you every time you have a new member. It’s about, this company applied, we accepted them into the program, and this company is going to pay for an office, and the office is $1,000 a month, as an example. And I don’t care how many people you put in that office. I don’t care if you put two people or seven people. It’s the same price. It’s $1,000, and that $1,000 covers utilities, internet, janitorial, security, conference rooms, phone booths, Zoom rooms, all our programming, all our workshops, all our mentors, all the different things. And the company then, as an entrepreneur, the company doesn’t have to worry about, ‘Well, if I hire two more people, my monthly bill’s going to be higher.’ They don’t have to worry about that. They can focus on growing their business and know that it’s all-inclusive, all the spaces are furnished, and it’s built to support them as they’re growing their businesses.”

On the subject of economic development, Laney said that historically everybody thinks of economic development as two things: recruitment and retention. Laney cited the example of Oklahoma trying to get Tesla to come to the state. The second way most communities have done economic development is through retention. Groups work to retain the businesses that are already in Oklahoma and keep them from going somewhere else.

“I think there’s a third,” said Laney. “I’m a big believer in the third, which is let’s grow new businesses. Let’s make sure we’re supporting the growth of new industries and new businesses here. We don’t just have to recruit them here; let’s grow them here. But it requires the same kind of investment in terms of infrastructure, resources, workforce, capital, tax incentives, all those same things.”

Laney clarified that we should continue the other two ways and add the third piece to support the growth of new businesses. 

Devon Laney will be speaking at the Oklahoma Venture Forum Power Lunch on Wednesday, November 10, 2021. The event will be open to guests both in-person and virtually via ZOOM. Laney is excited for the opportunity to be able to share a success story from a community perspective. 

“36 Degrees North is a non-profit, 501C3, and it would not exist without the public and the private partnership together,” said Laney. “In 2017, when 36 Degrees North launched, you had philanthropic community, public, private, chamber. They all came together to create this thing, and it’s a success story. It’s a win, and that’s what has enabled us to even evolve and to think about what we’re going to be in five years from now. If they hadn’t been successful at doing that, we wouldn’t be in a position to think about how to evolve it and be better and bigger going forward. So I love the opportunity to share about a success from a public-private partnership.”

A profile on Rick Nagel written for the Oklahoma Venture Forum on the subject of Adding Value to Investment Deals.

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Rick Nagel is the Managing Partner of Acorn Growth Companies. This small middle-market private equity firm focuses exclusively on ladder stage and growth investments in the aerospace, defense, and intelligence sectors. The company has been around since 2000, starting as the first privately certified incubator in the state of Oklahoma. After 30 deals and on their fifth fund, the firm seeks opportunities to add value as an operating team.

“We look at 250 deals a year,” said Rick Nagel. “We do about two or three. So, we’re very picky. We invest mostly in North America and Europe.”

To boil down the selection process, Nagel explained that they focus on their strengths. Some deals are fast nos, and they get to a no quicker than they get to a yes. One of the critical filters is that they have to add value to the company.

“For us, and not every firm is like this, but for us, we want one plus one to equal seven,” said Nagel. “We’ve been driving historical performance since our internal rate of return really kind of, since the beginning on all of our platform exits, is track more than 30%.”

To maintain their high-performance level, they do this by not overpaying for anything and adding value after the close. This philosophy helps mitigate risk and drive more organic growth opportunities.

“We’ve got a lot to say grace over, so we don’t have that problem,” said Nagel. “It doesn’t mean we always get it right, but we have a pretty good batting average so far.”

Nagel advised those looking for funding to have their head screwed on straight on value and terms when making themselves look suitable for potential investors. People also need to be realistic going in on a deal. There’s a lot of great technology that never gets the funding behind it because the entrepreneurs are just too proud of it. Rick made the analogy of having a big percentage of a small pie or having a small percentage of a massive pie, which leads to having more pie on your plate. 

“As much as we looked at bringing on value-added partners, I think it’s important that entrepreneurs looking for capital equally go out and find value-added partners,” said Nagel. “It’s amazing to me what they’ll do and give up to people to get a deal done. They have no value at all in helping them drive to their end results. So, you want investors that are not just passive. Typically, the younger the company is, you want more hands-on deck. I always encourage people to do value-added capital.”

Rick Nagel will be speaking at the Oklahoma Venture Forum Power Lunch on Wednesday, October 13, 2021. The event will be open to guests both in-person and virtually via ZOOM. Nagel said OVF is great for entrepreneurs and potential investors. 

“My advice to anybody that might be reading this that’s not currently engaged would be to get engaged,” said Nagel. “If you’re an early-stage investor, whether you do a deal or not, you’ll see things that will make you smarter in that process by listening to these presentations.”