Seed Capital From Angel Investors: Lewis Hower, Executive Director, University Impact Fund (Part 4)

By guest authors Irina Patterson and Candice Arnold

Irina: Have you made any investments already?

Lewis: No, we have not made any investments, yet, out of the University Impact Fund.

Irina: If an entrepreneur heard about your program and want to get in touch with you, what is the best way to reach you?

Lewis: We have a website, www.uimpactfund.com, that explains what we do and has our contact information.

Also, a lot of the deals and information and connections that come through our door come through our personal networks as well as the strong networks of the folks on our board who are advisors to our program.

Irina: On average, from all the sources, how many approaches do you receive per month?

Lewis: On average, I would probably say around 10. That number will continue to increase as both our program and our student staff expand, so we have a greater capacity to absorb more work. But we will also get more once we establish ourselves more in the industry and it’s known and recognized that we are seeking strong relationships for potential investments and things of that nature. So, I would say once we’re at full capacity, I expect to get anywhere from 20 to 25 approaches a month.

Irina: Out of the 10 approaches that you receive, how many do you service?

Lewis: Out of those 10, I would say two, maybe three. We look for strong entrepreneurs who predominantly have a for profit-model in their organization and operation.

Not to say that we do not ever consider facilitating a nonprofit organization, but given that we are both establishing our program as well as our own potential deal pipeline, we do have a sharper focus on for-profit entrepreneurs.

And it also depends on the stage of their organization, what the area they’re currently servicing is, and whether it’s going to be the type of engagement where can be of assistance from a service and then from a funding capacity. It has to be an idea that we would think has promise and would be seen as a potential investment either for ourselves in the future or for one of our partner funds that’s currently making investments.

It’s been since May that we’ve really been going full speed ahead on this.

It was in the first few months of 2010 that we were getting a bit of the operations and organizations established, but I actually moved to Salt Lake City from San Francisco in May.

Irina: Were any of the deals that you serviced funded by your partner funds?

Lewis: Some of them have been, but on the entrepreneur side, a lot of them have been earlier stage, so we’ve been really helping them to build their infrastructure to the point where they could absorb more capital. There have been a few that have been funded through friends-and-family networks as well as some foundations and organizations.

Irina: How do you engage with entrepreneurs who are not local?

Lewis: We do a lot of e-mailing back and forth of information. We also, if they are overseas, we spend a considerable amount of time on Skype with them. Usually, the way that it’ll work is we’ll have an initial introduction, you know, “Tell us a little bit of the high level of who and what you are,” and then we ask them to send over all relevant and pertinent material, ranging from existing financials to marketing plans to business plans and everything in between.

We then do an initial analysis and dig in on that. Usually throughout the process, if it’s a three- or four-week engagement, we’ll have one or two Skype or teleconference dialogues with the entrepreneur to allow the students to ask questions that have come up in process of their research and analysis, to have the entrepreneur have the time to say, “I’ve really been thinking we want to focus on this a bit more.” So, it is an open dialogue, but we are aware and respectful of the entrepreneurs, the funders, and the partners at these different organizations that we work with, that their time is valuable.

That’s predominantly where Patrick [Mullen] and me come in to facilitate the process so that we are not being a large drain on the entrepreneur or the partner at the fund.

This segment is part 4 in the series : Seed Capital From Angel Investors: Lewis Hower, Executive Director, University Impact Fund
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