It's been interesting to speak with executives from start-ups who have received venture funding the past few weeks and how few have said they had trouble securing the money in the current environment. Granted, many began their fundraising efforts far in in advance of the economic meltdown and many had already closed their funding rounds before October. But it was still enlightening to hear a CEO honest enough to describe the difficulties he had raising money.
"I approached over 100 VC and private equity sources and about 75% of them didn't get beyond the first pitch," said Russ Hawkins, CEO of
Agilence Inc., a maker of point of sale video auditing software that announced a $4 million Series B round of funding on Tuesday. "For many of the VCs either we were out of step with their fundraising, the wrong geography or some had hard rules that they don't fund companies that serve retailers. About 20 of them went to more detailed due diligence and about five were advanced due diligence and
Granite [Ventures] just jumped to the head of the pack based on the terms they put on the table."
What helped Hawkins is a stellar track record with two other startups and that Agilence already is a revenue-producing company with a stable of customers that includes Bloomingdales and the New Jersey Turnpike Authority.
"What made it interesting is they have a mature product, they have live customers and they have a really compelling ROI in a huge sector," said Sam Kingsland, managing director with Granite Ventures. "This is an established business, not a technology speculative project." --
David Shabelman
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