Spare a million? Few people enjoy asking for money.
At venture institute,
you learn how to ask
The Investors Choice event
links startups with financiersBy Lyn Danninger
ldanninger@starbulletin.comSo asking a room full of strangers for several million dollars would seem like a daunting task. It's actually anticlimactic, according to a couple of local entrepreneurs.
Local entrepreneur Kevin Sypniewski took his pitch to the Investors Choice International Equity Capital Conference in Salt Lake City in February 2001.
Sypniewski successfully obtained $2 million in first round of venture capital and is now working on a second round of capital for his company, AssistGuide Inc.
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Likewise John Prest, chief executive officer of Integrated Optical Corporation and a graduate of the same event in last year's incarnation on Maui, is about to complete his first round of venture capital. Prest declined to specify how much money is involved.Both men say it's the lead-up to the conference where much of the hard work is really done.
When it's time for the 10-minute presentation before the venture capitalists and industry representatives at the conference, it's almost second nature, Prest said.
"By the time you get there and do it you're on remote control, you're well prepared," he said.
The 2002 Investors Choice International Equity Capital Conference returns to Maui Wednesday and Thursday. This will be the fourth year in Hawaii for the conference, which is sponsored by the Utah-based Wayne Brown Institute.
It gives entrepreneurs a chance to make their pitch for needed capital to a group of venture capitalists and industry experts drawn from the mainland and Hawaii.
Prior to that point, those selected have endured many practice sessions and critiques with a team of professionals and have refined their presentations, Prest said.
"You're assigned teams to work with you on your presentation, they also bring in real VCs for feedback," said Sypniewski.
Sypniewski founded AssistGuide Inc. and developed an on-line resource guide for seniors and the disabled; as well as internet-based business systems for related health-care products, services and providers. The company has 20 employees and offices in St. Louis, Houston and Dallas as well as Hawaii.
With round one under his belt, Sypniewski said connections made at the conference have also helped in obtaining a second round of venture capital. He's in the process of negotiating the deal.
"We are now in the middle of working on financing with one of the people we met there at the conference," he said.
Sypniewski said a big part of the event's value, apart from networking opportunities and the exposure, is the amount of effort the conference advisory team put into coaching and preparing those who participate.
"It gave us a more polished presentation," he said.
Because those who participate are allowed about 10 minutes to make their presentation, every minute counts.
Sypniewski has attended other VC conferences before where there wasn't as much personalized attention.
"The other ones I've been part of were pretty much submit your information and if we like you we might give you a few pointers on the back end," he said.
Even if no venture capital comes immediately, Sypniewski believes participants are better off for the experience.
"I think every company should make the effort to participate if attracting outside investment is the path they want to go down," he said.
Sypniewski notes attracting investment is even tougher since the tech bubble collapsed.
"Raising money is a much more difficult task now, which makes the value Wayne Brown provides in counseling and mentoring even greater. We had attracted money before the downturn but you always anticipate you need to attract more," he said.
Prest of Integrated Optical said his company began with a series retail outlets in 1997. He consolidated those outlets, then grew them into an optical supply chain that provides independent eye doctors with a direct link to optical suppliers and manufacturers.
Prest partners national optical laboratory Diversified Ophthalmics to supply his products.
Integrated Optical provides a way for the independent doctor to compete in a market that has been increasingly taken over by big box retailers, he said.
Prest said he has been able to network with other local and mainland VCs through the networking he did at the Maui conference.
"It offers exposure. Funding today especially equals networking, without it you're going nowhere," he said.
Ultimately, Prest said he hopes to expand into other selected markets outside Hawaii and perhaps one day do either a private equity sale of the company or an IPO.
This year, five Hawaii companies have been chosen to be part of the event at the Westin Maui Hotel. They are: Kona Bay Marine Resources, a Honolulu and Kona-based aquaculture company; Hoku Scientific, a Honolulu-based developer of fuel cell technology; Aiea-based Hawaii Biotech; Maui-based White Hat Security, a Web application security software company; and Zoji Golf, a Honolulu golf company that offers customized equipment targeting the youth golf market.