Carson’s research shows relationship factors very important in VC, angel decisions

(Originally published on Teknovation.biz)

By Tom Ballard, Chief Alliance Officer, PYA

Shawn Carson says the research conducted for his recently completed dissertation on the critical risk factors considered by angel and venture capitalists confirmed some things he expected, but also held a big surprise.

“What I expected was the importance of the ‘Big 4,’ what surprised me were the relationship factors,” the Lecturer in the Haslam College of Business at the University of Tennessee Knoxville and Consultant with Three Roots Capital says.

The ‘Big 4,” as he describes them, are execution – can the management team execute the business plan, market – is there a viable market for the product or service, technology – does it work, and funding – can the start-up secure the necessary capital.

“Those are fairly objective measures that are commonly accepted,” Carson says. Yet, when he asked nine venture capitalists and nine angel investors for their list of all critical factors considered in making investment decisions, they collectively identified 82 unique ones.

Carson lumped those into seven categories like founders and management team, relationship, intellectual property, competitive factors, value proposition, scalability, and exit.

“By far, the number one category of factors was around relationships,” Carson said. “Six of the top 10 were about relationships.”

You might ask, “What are those six?” Survey says, in order, trustworthiness, ethics and honesty, integrity, coachability, character, and passion. Two others were in the top 20 – management ‘skin in the game’ and transparency.

Read more here.

Click below to view a summary of Carson’s research in this PDF document.

Carson Dissertation Summary – Executive Summary – For Distribution

Carson to share interesting insights into VCs, angels at Innov865 Investor Series forum

Originally published on Teknovation.biz

By: Tom Ballard, Chief Alliance Officer, PYA

“The numbers have to be there, and they also have to like you,” Shawn Carson says in succinctly capturing the results of the research undertaken on investment strategies for his recently completed dissertation at the University of Tennessee (UT).

The long-time player in the Knoxville region’s entrepreneurial ecosystem will share the results of his research at tonight’s “Innov865 Investor Series” forum, then moderate a panel discussion about the topic. The panel will feature Tony Lettich of The Angel Roundtable, John Morris of The Lighthouse Fund, Grady Vanderhoofven of Three Roots Capital, and Ken Woody of Innova Memphis.

Carson is well-known across East Tennessee for his skills as a workshop leader and effective communicator. As such, it was only natural that the soft-spoken Lecturer in UT Knoxville’s Haslam College of Business would decide to pursue his doctorate. And, it should come as no surprise that his previous ties to the now defunct Technology 2020 and current additional role at Three Roots Capital would lead him to a dissertation topic based on the decision-making process used by angel and venture investors.

“I’ve been studying entrepreneurial risk for a while,” Carson told us in an interview ahead of the forum. We wanted to better understand the methodology that he used and the results that he uncovered.

“Entrepreneurs take risks, investors avoid risks,” Carson explained. “I wanted to know if there was a way to quantify risks beyond the ‘Big 4’ – execution, market, technology, and funding.”

The short answer is “yes,” but it took some work. Carson described his challenge as “developing a process that would get people to explain their individual risk factors in a way I could quantify.” To do it, he selected the Delphi Method developed in the 1950’s to achieve consensus while avoiding biases of those surveyed.

Read more here.

Rise & Grind highlights the importance, financial advantages of leadership diversity in the workforce

Coffee, donuts, and an engaging conversation held at UTRF’s Business Incubator showcased the need for increased flexibility and diversity in the workforce.

On Wednesday’s Rise & Grind event the audience became acquainted with Kim Seals, General Partner of MomSource Network investor The JumpFund and Courtney Jones Startup Day alum & Founder of the MomSource Network.

MomSource Network is a startup focused on seeing women achieve their ideal work/life blend. The company has two separate parts to its business. Part one is a tech platform focused on development and training for women as they navigate their journey in and out of the workforce. MomSource Network also provides a gateway of progressive employers who are willing to use their skill set in a flexible full-time, permanent, or part-time remote capacity.

The other half of the company is providing consulting services to those progressive employers who are mindful about attracting and retaining great female talent.

The JumpFund’s mission is to invest women’s capital in female-led southeastern companies with growth potential in order to generate a strong financial return and elevate the role of women in business.

The JumpFund invested in MomSource Network about two years ago, and Kim Seals along with her sister Pam made a sidecar investment as well.

“There’s a lot of data that supports that there is a need for women to invest in women, and it can produce a good ROI,” said Seals.

During the Rise & Grind event Seals recited striking statistics that highlight the positive financial outcomes from employing a woman within a company’s leadership.

According to a recent MacKenzie survey, companies with at least one female founder are performing 63% better than investments with all male-led companies.

“We want to see diversity in that leadership, and one of the key reasons is that most purchasing decisions made in the household are made by females,” said Seals.

Seals brought up that 80% of all purchasing decisions in the household are made by women. If a company doesn’t have a female in its leadership team helping make product and strategy decisions, that business is missing a key voice of their customer.

“We’re seeing companies with women in the top leadership positions producing 47% higher returns on equity and 55% higher returns on EBIT,” said Seals.

On top of that, Courtney Jones echoed the importance of flexible employment.

“85% of people say they would be more loyal to their current employer if they were offered increased flexibility,” said Jones.

Jones mentioned that in society, women are often pushed into choosing whether to become a full-time working mother or a full-time stay at home mom.

“At the end of the day, it’s really about organizations being progressive enough to say, ‘We’re willing to offer some agile workplace arrangements if we can still get the results that we need for our business,'” said Jones.

Seals reinforced that need for flexibility after describing her background in human resources with Mercer and it’s importance at the time.

“There was a real financial ROI for our companies that we were working with at Mercer about how to keep women in the workforce,” said Seals.

Seals said Mercer quickly discovered that they needed to keep women engaged, figure out how to create that work/life blend for them because it was something their clients were asking for. Ultimately, that’s what led to her interest in MomSource Network.

Rise & Grind was hosted by UTRF, Three Roots Capital, and Best Behavior Creative Club

Rise and Grind, Hosted by Three Roots Capital

Free coffee and donuts! Yum!

If that’s not enough reason to attend, there will be an interview and Q/A session with Courtney Jones, founder of MomSource Network, and Kim Seals, a board member of MomSource Network and general partner of MomSource Network investor The JumpFund. They will be discussing entrepreneurship, raising capital, investor/operator relationships, and… doing those things as women.

RSVP for Rise & Grind Here.

Founded in August 2013, MomSource Network is an online community that provides continuing education, virtual networking and a gateway to progressive employers offering flexible work options. The JumpFund provides necessary capital for women entrepreneurs to ignite growth ventures throughout the Southeast.

Sponsors for Rise & Grind include:

Local Motors’ Olli to make its debut in September during Innov865 Week

April’s Innov865 Happy Hour sponsored by Three Roots Capital welcomed a special announcement from Knoxville Mayor Madeline Rogero, telling a hefty crowd at Scruffy City Hall that Local Motors’ self-driving electric vehicle Olli will soon be making its debut this September during Innov865 Week.

Olli was created at Local Motors’s micro factory in Hardin Valley using 3D printing technology.

Add that to the many reasons you should attend the Innov865 Alliance’s Signature Week celebrating entrepreneurship and the Knoxville startup community.

This comes after a series of technology announcements in East Tennessee. In Market Square earlier Thursday, Olli was unveiled for the public to get an up-close look at the innovation happening in Knoxville.

Knoxville Mayor Rogero announcing self-driving vehicle Olli will soon be taking over City streets.

It’s important to mention, Visit Knoxville is going to roll an Olli out on a test basis this fall at some events in places like World’s Fair Park and Chilhowee Park and Exposition Center.

The longer-term goal is to have Olli running on city streets, by the end of next year, for Visit Knoxville events and giving tours of the city following pre-programmed maps.

There was also a separate announcement on Tuesday from Knoxville entrepreneur Bill Malkes, founder of GRIDSMART.

The company has donated some of its new STREETSMART Wi-Fi data cameras for the City of Knoxville to pilot at some of the busiest intersections along Kingston Pike, specifically the intersection of Kingston Pike and Northshore Drive.

These cameras collect real-time traffic information on traffic flow and congestion, which City engineers can use to get better information about how and when traffic backs up on that corridor.

This will help the City make better adjustments to signal timing and eventually to respond immediately to changing conditions so that they can reduce congestion, reduce vehicle emissions, and get everybody where they’re going faster.

These two technologies combined could eventually become a fully connected smart transportation system, where you have vehicles like Local Motors’ Olli sending and receiving information to infrastructure like GRIDSMART’s cameras, allowing everything to move much more efficiently.

With both of these announcements and the work going on at Oak Ridge National Laboratory and across the Innovation Valley, Knoxville is well positioned to be on the forefront of smart transportation technology.

(L to R) Grady Vanderhoofven of Three Roots Capital, Bill Malkes of GRIDSMART, and Tom Ballard of PYA & Teknovation.biz

During the April Innov865 Happy Hour sponsored by Three Roots Capital, there was also a featured fireside chat with GRIDSMART Founder Bill Malkes and Three Roots Capital CEO & Meritus Capital Management Managing Partner Grady Vanderhoofven. The two, along with moderator Tom Ballard of PYA and Teknovation.biz, discussed the founding and growth of GRIDSMART and the role the company is playing in the intelligent transportation industry.

Bill and Grady talked about how the company was founded, raised capital, staffed the business, developed its product, established and expanded production in East Tennessee, and what the future holds for GRIDSMART.

April Innov865 Happy Hour hosted by Three Roots Capital

Special announcement from Knoxville mayor, featured fireside chat

The Innov865 Alliance invites you to join the entrepreneur and startup community in another engaging Innov865 Happy Hour, hosted by Three Roots Capital.

An evening of networking awaits you, Thursday, April 20, 2017 at Scruffy City Hall in Market Square from 5:30 p.m. to 7 p.m.

During this time, there will be a special announcement from Knoxville Mayor Madeline Rogero followed by a featured fireside chat with Bill Malkes, founder and CEO of GRIDSMART and Grady Vanderhoofven, Managing Partner of Meritus Capital Management and CEO of Three Roots Capital.

The fireside chat will be moderated by Tom Ballard of PYA and Teknovation.biz, where discussions will range from the founding and growth of GRIDSMART and the role the company is playing in the intelligent transportation industry.

GRIDSMART has evolved from a concept to the fastest growing company in its industry.

GRIDSMART, a company founded in Oak Ridge and based in Knoxville, provides technology that monitors and controls traffic at intersections and on roadways in 22 countries on five continents around the world.

Their products reduce congestion, increase efficiency, and reduce environmental impact. As the dawn of a new world of autonomous vehicles brightens, cars and traffic management systems will share information. Companies like GRIDSMART are leading the way.

Meritus was one of GRIDSMART’s early investors and has held a position on the company’s Board of Directors for years.  Bill and Grady will talk about how the company raised capital, staffed the business, developed its product (software and hardware), established and expanded production in East Tennessee, and what the future holds for GRIDSMART and intelligent transportation.

Knoxville Showcases its Entrepreneurial Spirit at Startup Day 2016

East Tennessee’s leading investors, innovators, entrepreneurs and business leaders convened at the U.S. Cellular Stage at The Bijou Theatre in Downtown Knoxville on Thursday, September 22, 2016 for the fourth annual Startup Day. The event is part of Innov865 Week, which celebrates and showcases Knoxville as a great place to start and grow businesses.

Graham Taylor, T&T Scientific won the pitch competition and was awarded $5,000 from sponsors Three Roots Capital and SouthEast Bank. T&T Scientific was one of six startups participating in the pitch competition this year.

Graham Taylor, co-founder of T&T Scientific, created LipX, a time-saving, single use extrusion device that researchers can use to prepare liposomes for use in a wide range of research applications. Unlike the gold standard device which requires 45-60 minutes to assemble and clean with each use, LipX is ready to use out of the package and does not require the use of harsh chemicals for cleaning.

Bob Bradley, President and CEO of NewsBreak and Startup Day 2014 alum, received the second annual Traction Award, presented by UT Federal Credit Union. The Traction Award is given to a Startup alum who has gained the most momentum in the past three years. Launched in 2009, NewsBreak is a programmatic merchandising platform that converts fuel-only customers to multi-product purchasers.

Startup Day also featured Paul Singh, nationally recognized serial entrepreneur and seed stage investor, who came to Knoxville as part of his North American Tech Tour. Aside from being a featured guest at Startup Day, Paul held one-on-one consultations with a lucky few Knoxville-area startups to gain a better understanding of Knoxville’s entrepreneurial landscape and identify potential investment opportunities.

“I continue to be amazed and inspired by the entrepreneurial talent we have here in Knoxville,” said Stacey Patterson, Vice President of the University of Tennessee Research Foundation and founding member of the Innov865 Alliance, which hosts Innov865 Week. “Our region has a rich tradition of innovation, and Startup Day gives our entrepreneurs a platform to share their hard work and grow their businesses. The award winners and startup pitchers truly exemplify Knoxville’s entrepreneurial spirit.”

Startup Day was just one in a series of events held during Innov865 Week, which wraps up today. Throughout the week more than one thousand entrepreneurs, investors, business leaders, students and the East Tennessee community participated in educational panels, investor roundtables and social events that promoted entrepreneurship in Knoxville and the surrounding area.

About Startup Day

Startup Day is an annual event that showcases Knoxville as a destination for startups and entrepreneurs. The event is part of Innov865 Week which is organized by the members of the Innov865 Alliance: The University of Tennessee Research Foundation, Oak Ridge National Lab, Launch Tennessee, PYA, Knoxville Entrepreneur Center, and The Anderson Center for Entrepreneurship & Innovation at The University of Tennessee, Knoxville. http://innov865.com/

T&T Scientific Wins Startup Day 2016 Pitch Competition

Graham Taylor with T&T Scientific claimed the winning pitch prize during Startup Day 2016 on Thursday, September 22, 2016 on the U.S. Cellular Stage at The Bijou Theatre in Downtown Knoxville.

Graham Taylor, T&T Scientific received $5,000 from sponsors Three Roots Capital and SouthEast Bank. The winning pitch was one of six heard during the fourth annual Startup Day, which began offering prize money for a pitch winner in 2015.

“Graham Taylor exemplifies the entrepreneurial spirit that defines Startup Day and makes Knoxville such a great place to grow a business. It is truly an honor to bestow this prize on T&T Scientific and I am excited to see where the future leads them,” said Monty Montgomery, President of SouthEast Bank.

Graham Taylor, co-founder of T&T Scientific, created LipX, a time-saving, single use extrusion device that researchers can use to prepare liposomes for use in a wide range of research applications. Unlike the gold standard device which requires 45-60 minutes to assemble and clean with each use, LipX is ready to use out of the package and does not require the use of harsh chemicals for cleaning.

Judges David Kereiakes, Senior Associate, River Cities Capital Funds; Sue Malone, President, Strategies for Small Businesses; and Tony Shipley, Chairman and Co-Founder, Queen City Angels, scored all presentations on a variety of criteria including value proposition, market and sales strategy, distinctive competence and growth potential.

“Startup Day’s Pitch Competition showcased some of the best entrepreneurial talent that East Tennessee has to offer,“ said Grady Vanderhoofven, President and CEO of Three Roots Capital and co-presenter of the $5,000 prize. “I commend all of the entrepreneurs for their hard work and vision, and look forward to seeing them grow their businesses.”

Startup Day 2016 featured Paul Singh, nationally recognized serial entrepreneur and seed stage investor, who came to Knoxville as part of his North American Tech Tour. The event also featured the awarding of the second annual Traction Award, sponsored by UT Federal Credit Union, which is presented to a Startup Day alum who has made the most progress over the past few years. Bob Bradley of NewsBreak was the 2016 recipient.

All six startups received a one-year subscription to FundingSages’ TurboFunder Platform, which provides entrepreneurs information, resources and tools to guide them through the creation and development of an investable company.

About Startup Day

Startup Day is an annual event that showcases Knoxville as a destination for startups and entrepreneurs. The event is part of Innov865 Week which is organized by the members of the Innov865 Alliance: The University of Tennessee Research Foundation, Oak Ridge National Lab, Launch Tennessee, PYA, Knoxville Entrepreneur Center, and The Anderson Center for Entrepreneurship & Innovation at The University of Tennessee, Knoxville. http://innov865week.com/event/startup-day-2016/

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