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Seed Capital From Angel Investors: Peter Birkeland, RAIN Fund Program Manager, RAIN Source Capital (Part 2)

By guest authors Irina Patterson and Candice Arnold

Irina: Would you consider yourselves regional and national at this point?

Pete: I would say we’re regional now with the goal of being national.

Irina: Since you have such a diverse membership, would you say that you have a specific expertise or a more general approach?

Pete: I think we’ve got expertise in multiple areas throughout our fund. Most of our members are business owners and entrepreneurs themselves. And we have a good background in traditional manufacturing, we have people who have medical backgrounds, high-technology backgrounds, energy, distribution, veterinary sciences, and biotech.

We can find expertise in the network. We’ve got access through our investors, through portfolio company managers, things like that, where we can, hopefully in a short period of time, find the expertise we need to evaluate a deal. >>>

Seed Capital From Angel Investors: Peter Birkeland, RAIN Fund Program Manager, RAIN Source Capital (Part 1)

By guest authors Irina Patterson and Candice Arnold

This is the tenth interview in our series on financing for entrepreneurs. I am talking to Peter Birkeland, RAIN Fund Program Manager at RAIN Source Capital, a multistate network of RAIN® funds.

The network currently has more than $33 million invested in 55 companies. Its head office is in St. Paul, Minnesota.

Irina: Hi Pete, Could you tell us a little about your own background?

Pete: I started off in public accounting and then wound up doing some incubation in a company and decided I wanted to work with startup businesses. From there I went to do some tech transfer work, and then years ago I joined RAIN Source to help on the financial side. Now I manage our RAIN Fund program.

Irina: Tell us about RAIN Source Capital.

Pete: RAIN Source Capital is network of angel funds, 23 of them, that operate mainly in the upper Northwest – Minnesota, North Dakota, South Dakota, Iowa, Montana, and Idaho. These 23 funds are made of 450 accredited investors, and we’ve been operating as an entity for about 12 years and focused on specifically angel investing for the past seven.

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Working Capital (Debt) Financing For Entrepreneurs: Mitch Jacobs, Founder And CEO, On Deck Capital (Part 6)

By guest authors Irina Patterson and Candice Arnold

Irina: What do you think business owners should do, in general, to be more successful with finding the capital that they need?

Mitch: I think the absolute, most pivotal thing that business owners need to do is to make it easier for lenders to understand the performance profile of their businesses. >>>

Working Capital (Debt) Financing For Entrepreneurs: Mitch Jacobs, Founder And CEO, On Deck Capital (Part 5)

By guest authors Irina Patterson and Candice Arnold

Irina: What business sectors do you usually see?

Mitch: It’s all of the local services that you would see in any community or neighborhood. Restaurants, retail, local practitioners such as doctors, dentists, veterinarians, hospitality, hotel and lodging, plumbing, HVAC, repairpeople. Those are the major categories. Then there’s a category of “other” that probably includes another 50 [types of businesses]. It’s all of the different retail and service operations that make a neighborhood or town work. >>>

Working Capital (Debt) Financing For Entrepreneurs: Mitch Jacobs, Founder And CEO, On Deck Capital (Part 4)

By guest authors Irina Patterson and Candice Arnold

Irina: All your contacts with businesses seeking financing and all the processes are through the software, right? There are no people-to-people meetings like angel groups have?

Mitch: No. Although, I think increasingly there are businesses where there’s both a technology layer and a business services layer. And we do have people who get on the phone with small businesses owners. Small business is still a contact sport. >>>

Working Capital (Debt) Financing For Entrepreneurs: Mitch Jacobs, Founder And CEO, On Deck Capital (Part 3)

By guest authors Irina Patterson and Candice Arnold

Irina: How long do they need to be in business?

Mitch: We work with businesses that have typically been in businesses for several years. It’s not a program for startups. It’s a program for businesses that typically have $250,000 to $3 million in revenue and also businesses that tend to have a very high volume of small transactions but tend not have any collateral or hard assets as traditionally defined by a bank. >>>

Working Capital (Debt) Financing For Entrepreneurs: Mitch Jacobs, Founder And CEO, On Deck Capital (Part 2)

By guest authors Irina Patterson and Candice Arnold

Mitch: In general, business owners don’t do a good job of helping a bank to very quickly and readily understand the excellent performance of their businesses. It’s very hard for a bank to assess the performance of a small business. Given the economics of small loans, it ends up with the bank using the credit score as a substitute for any real analysis of business performance. >>>

Working Capital (Debt) Financing For Entrepreneurs: Mitch Jacobs, Founder And CEO, On Deck Capital (Part 1)

By guest authors Irina Patterson and Candice Arnold

This is the ninth interview in our series on financing for entrepreneurs. I am talking to Mitch Jacobs, founder and CEO of On Deck Capital, a small business online lending platform.

Irina: Hi, Mitch. Let’s start with your background and how you arrived where you are today.

Mitch: I began a career in entrepreneurship, somewhat unintentionally, as a junior at Dartmouth College. I launched a company that enabled local businesses to accept the student ID card as a form of payment off campus. It had a different name at every campus. >>>