Category: News Stories

By John Tozzi for Businessweek

For small companies selling consumer products such as makeup or snack food, a partnership with a big multinational company can mean the difference between obscurity and becoming a household name. How does a small brand get a behemoth’s attention?

CircleUp, a crowdfunding website that connects startup consumer brands with investors, wants to be part of the answer. Today, the company announced a partnership with Procter & Gamble (PG) to get companies on CircleUp in front of P&G executives scouting for new brands. It made a similar deal with General Mills (GIS)last year.

Most companies on CircleUp have $1 million to $10 million in yearly sales and are trying to raise about $1 million from wealthy individual investors, says Chief Executive Ryan Caldbeck, a former private-equity investor. Since opening its doors last April, CircleUp has helped eight companies close funding deals. In addition to connecting young companies with investors, CircleUp wants to expose them to multinationals that could lead to partnerships or acquisitions, he says.

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By Kevin Colleran

One of the very first hurdles that a new entrepreneur faces is how to find the initial capital necessary to fund the process of building a company. Most entrepreneurs begin using their own money for the initial costs. Eventually, however, the time comes that it no longer makes sense (or is no longer possible) to continue doing this. At this point, entrepreneurs need to figure out a strategy to raise the funds necessary while minimizing disruption of day-to-day business operations. If done incorrectly, fundraising can be incredibly distracting and difficult for the entrepreneur, and can slow any initial momentum that the business has attained. The best options for finding initial angel and seed investors are friends and family, incubators, professional investors and crowdfunding.

Upstart watchmaker Pebble announced at CES this week it would ship its smartwatch on January 23.

The smartwatch connects to a smartphone. “The idea is that instead of having to constantly pull out your smartphone, you can just glance down and see the key portion of the message right there,” said Pebble CEO Eric Migicovsky on CNBC’s “Squawk on the Street” Thursday. If you want to ignore the call, you simply shake your wrist. “If it’s someone you can brush off, you can just cancel it right there,” he said.

Fun features aside, Pebble’s arrival to market hasn’t been smooth. After becoming a darling on crowdfunding site Kickstarter last year, the startup ran into trouble when demand far outpaced supply, and the upstart wasn’t able to deliver by September 2012 as promised.

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By Matt Burns for Techcrunch.com

There we were, circled around a bachelor party campfire and drunk on keg beer, discussing the viability of using Kickstarter to fund a sex toy startup. My buddy Derk (he goes by Dangerous D at karaoke) had designed and handmade a compact speed controller for small vibrators (pic below). He was selling them at $75 a pop and apparently – I have yet to see or try one – they were getting rave reviews. Dangerous D’s Magic Box, he called it. Another friend and I were passionately trying to convince him to quit his job as a store manager and start a sex toy startup. We were positive, and a bit drunk, that all he needed was a successful Kickstarter campaign. The video would obviously be key.

It was then I knew that 2012 was the year of crowdfunding. It’s a household term now. This year saw the birth of the Pebble Smartwatch, iPhone-powered gTar, OUYA gaming system, and literally tens of thousands of arts, media, and design projects. And those were just on Kickstarter. Other projects turned to Indiegogo, RockThePost, and Quirky. Some startups like Lockitron even went at it alone, conducting their own crowdfunding campaign themselves.

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By Kristin Voinovich For Venture Beat

January 6, 2013 12:18 PM

Investment Bankers have traditionally been the gatekeepers of access to the capital markets.  It is time for crowdfunding to play a greater role.

The caliber of underwriting firm is often an indication of the quality of the issuing company. The investment banks are paid well for that implicit endorsement, but that puts their reputations on the line. Their success is tied to the execution, after market performance and perception of the deals they complete –so they had better be selective and smart.

However, the banks are not infallible. The capital raising process has been inexorably altered by many different changes to the funding environment.  I am not talking just about the botched Facebook IPO either.   But the banks are pretty good.

The playing field between institutional investors and “mom and pop” is not level.  The market is driven by inefficiencies and the average investor is generally on the wrong side of the spread.  The differential comes down to knowledge.
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By Wayne T. Price for FLORIDA TODAY

12/16/12

The Space Coast likes to boast, often with good reason, about the area’s deep pool of entrepreneurs.

Some of them are trying hard to get the attention of investors through the Space Coast Energy Consortium’s “Space Coast Challenge,” a venture with the New York-based crowd-funding company RocketHub Inc.

Last month, the consortium selected 10 area entrepreneurs to participate in the fund raising challenge using RocketHub as the launch site. Two dropped out of consideration and now there are eight in the group.

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When the disappointment of unfulfilled pledgers set in on Kickstarter, the notion was that something had to be done. I thought the solution would have been to better educate backers on the potential fallibility of the design process, but I realize that’s unrealistic, given how long it takes us ID’ers to learn what we know: Two to four years of school, the internships, the first few floundering projects executed as a freshly-minted designer.

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