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September 2014 Newsletter

September 2014 Newsletter

17:10 03 September in Uncategorized
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This is a regular update of events and deal news for BWA members. We respect your time: if you do not desire updates please simply unsubscribe – we wish you nothing but success!
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The Art of Angel Investing =  De-riskingby Ken KouskyThe art of angel investing boils down to successful de-risking. There is a continual flow of new opportunities for individuals to convert savings into meaningful (both social value and significant financial return) investments. However, when the government steps in, the quality of its decisions is inevitably distorted by lobbying. When you pit David against Goliath, at least in Washington, David doesn’t fare as well as in the original story.So we should not be surprised that the financial services industry (Goliath) continues to pour hundreds of millions of dollars into a permanent presence keeping Wall Street linked to K Street, not Main Street.

Congress passed a valuable piece of legislation with broad bi-partisan support called the JOBS Act (the abbreviation for – Jump Start our Business Start-ups). So far, it’s clear that this particular law is simply adding to the ongoing decline in the pace of US start-ups.

Continue reading article…

Open Deals

RetroSense Therapeutics Series A follow-on round is expected to close in the coming weeks; approximately $1M remaining in the Series A.

It has been a busy, but productive year, thus far in 2014 for RetroSense Therapeutics.  The Company has made substantial progress on its Series A round of investment which has enabled the company to make substantial progress in IND-enabling studies.

In preparation for the IND-enabling safety studies, RetroSense initiated and completed manufacturing and testing of vector suited to these studies.  Since then, the first of two stages of clinical “GMP” manufacturing has been started with a completion of both stages anticipated in Q1 2015.  The company is on pace to finish IND-enabling work in Q1 2015 and initiate human clinical studies in Q2 2015.

*RetroSense is a biotechnology company at the forefront of developing optogenetic therapies for vision restoration.  These game-changing gene therapies are designed to restore vision in patients suffering from blindness due to retinitis pigmentosa (RP) and advanced dry age-related macular degeneration (advanced dry-AMD).  RST-001 is the company’s lead product.  There are currently no FDA approved drugs to improve or restore vision in patients with these retinal degenerative conditions.

The company is led by a team of seasoned veterans with experience in developing some of the most successful drugs on the market and numerous successful new business ventures.  For more information on RetroSense Therapeutics, visit www.retro-sense.com.

Portfolio Updates

*ProNAi Therapeutics Announces New CEO

ProNAi Therapeutics announced last week the appointment of Nick Glover, Ph.D. as President and Chief Executive Officer.  The company’s previous CEO, Mina Sooch, will be leaving the organization to pursue new opportunities.

Dr. Glover, an accomplished biotech executive, brings to ProNAi Therapeutics extensive experience in the field of oncology drug development.  Dr. Glover most recently served as President and Chief Executive Officer of YM BioSciences Inc. (NYSE: YMI; TSX: YM), a publicly traded oncology drug development company acquired by Gilead Sciences Inc. in February 2013. Previously, Dr. Glover was President and Chief Executive Officer of Viventia Biotech Inc., a drug development company developing novel therapies for cancer, and Investment Manager at MDS Capital, a life sciences venture capital firm.  He currently serves on the board of directors of MEI Pharma Inc., a company focused on cancer drug development (NASDAQ: MEIP).  Dr. Glover holds a B.Sc. in chemistry from the University of East Anglia, Norwich, England and a Ph.D. in chemistry from Simon Fraser University, British Columbia, Canada.

*ProNAi Therapeutics, Inc., is advancing DNA interference (DNAi®) technology, a proprietary and differentiated nucleic acid therapeutic modality.  DNAi utilizes single-stranded, unmodified, phosphodiester DNA sequences designed to specifically hybridize to genomic DNA and modulate gene transcription.  Beyond PNT2258, the company is developing DNAi assets against other cancer and non-cancer targets.  For more information on ProNAi, visit www.pronai.com.

*Altus Brands Acquires iHunt!  The No. 1 hunting app for smartphone users, iHunt, is joining the Altus Brands family.

Altus Brands, headquartered in Grawn, Michigan, has acquired iHunt, an app that features high-quality animal and hunting calls.  With a 4.5 reviewer rating, iHunt has been the best-selling hunting app for more than three years.

Gary Lemanski, President of Altus Brands, said, “We are real pleased to have acquired iHunt.  Not only does it boost our portfolio of unique species calls to over 1,000, it will help us grow and compete in the digital calling market.”

The i-Hunt app features an unmatched selection of more than 47 animals and 600 hunting calls. For example, the app features 40 different deer calls, 54 coyote calls, 37 turkey calls, 29 duck calls—even 26 alligator and crocodile calls—just to mention a few.

The iHunt app joins an Altus Brand family that already includes market leaders such as Pro Ears, Benchmaster, Cass Creek Electrontic Game Calls, Extreme Dimension Wildlife Calls, Harmon Scents and Kwikee Kwiver.

*Since 2008, Altus Brands LLC has worked with small to mid-sized companies in the hunting, shooting and outdoor market to unlock their potential for growth through partnerships and acquisitions.  For more information on Altus Brands, visit www.altusbrands.com or call (800) 891-3660.

The iHunt app is available through iTunes or Google play at ihuntcalls.com

I-Corps Update

MMIC Announces an I-Corps boot camp in Midland.  This will be the first time this highly regarded program has been offered outside our top research universities. Stanford and Berkeley have proven the success and the University of Michigan is now carrying this program forward throughout the Midwest.  We just broke the model by making it a tool for industry and not just research universities.

Save the Date

BWA’s Fall Dinner Deal Review Meeting, September 24 (Wed), at Apple Mountain, Freeland, 5:00-9:00pm.  (Angel Overview at 4:00pm precedes reception and dinner meeting).

Presenters include:

foodjunky – www.foodjunky.com (Detroit)

foodjunky has a unique solution for online food ordering.  Founded by Travis Johnson and Andy Waldman, the pair has assembled a great team of developers and marketers with 70+ years combined experience.  The company’s business model, which charges the end customer rather than the restaurant, differs from others in the space by accommodating the needs of both restaurants and customers.

Organizations such as The Kresge Foundation, Tumblr, International Bancard, and Crain Communications have already streamlined the food ordering by using foodjunky company-wide.  With an average revenue growth over 1000% per month in 2014, foodjunky has proven the ability to attract and retain customers.

From office managers to c-level executives, foodjunky is known as “the easy way to order food”.

Harrietta Hills Trout Farm – www.harriettahills.com (Harrietta Hills)

Harrietta Hills Trout Farm is located in rural Harrietta, Michigan, in the heart of the Manistee National Forest.  The Vogler family has operated this farm since 2001, and it is the primary source of Michigan farm raised rainbow trout in the Michigan marketplace.

Despite the small size of its business, HHTF is the largest aquaculture farm in Michigan and has been an industry leader focusing on development and growth of the potential for farm-raised fish in Michigan. The company is now undergoing a major expansion of its production capacity from less than 200,000 lbs. per year to over 600,000 lbs. per year.

Halo Report – Congratulations to the Great Lakes Region which rivals California in Q1 activity!

In early 2012 the Angel Resource Institute, Silicon Valley Bank, and CB Insights launched a collaborative project intended to raise awareness of early stage investment activities. Together, the three organizations produce a quarterly research report, titled the Halo Report™, which highlights angel group investment activity and trends in the United States while providing much sought after data previously not available to entrepreneurs or early stage investors.

Here’s the latest U.S. Angel investing trends in the Q1 2014 Halo Report…. Angel Group Round Sizes and Valuations Up in 2014:

The report found median angel group round sizes increased to $980K per deal and pre-money valuations rose to $2.7 million in the first quarter of 2014 (compared to $600K and $2.5 million respectively in 2013).

•           All of the top ten most active groups were ACA members.

•           Together internet, healthcare and mobile companies comprised 71.5% of all deals, with internet companies receiving the largest percentage of

investment dollars.

•           75% of deals were completed in the angel groups’ home state.

Angel Capital Association – The latest on the SEC’s Consideration of Accredited Investor Definition

Have you been wondering what’s happening with the accredited investor definition?  There has been a tremendous response by angels and startups, but consumer advocates continue to actively recommend at least a doubling of the financial requirements.  Also, the timeline for the SEC rules or decisions is later than we originally thought.  The SEC Investor Advisory Committee met on July 10 and leaders said they would make their recommendations to the SEC on October 9, pushing SEC actions on the issue to late this year.  The committee discussed a range of ideas, including raising thresholds even higher than previously discussed creating new categories of “sophistication.”

To stay current, checkout these excellent articles!

SEC Advisory Committee Mulls Accredited Investor Criteria  

Who Should be Deemed ‘Sophisticated’ Enough to Be an Investor? (Entrepreneur.com)  

Do You See Yourself as a Sophisticated Investor? (Wall Street Journal)

SeedInvest (ACA member platform) campaign to Save Angel Investing – another easy way to write to the SEC

The Angel Capital Association is the leading professional and trade association supporting the success of angel investors in high-growth, early-stage ventures.  ACA provides professional development, industry voice, public policy advocacy and an array of benefits and resources to its membership of more than 200 angel groups and more than 10,000 individual accredited investors.

ACA’s mission is to fuel the success of angel groups and private investors that invest in high growth, early-stage ventures.

Upcoming Events

September 16 (Tues):  MMIC Speaker Series, “Innovators Spotlight”, Monthly, third Tuesdays, Noon to 1:00pm / light lunch provided – donations welcome.  To register, visit, www.mmic.us, or call MMIC Receptionist at 989-839-2333.

September 17-19 (Wed-Fri):  ACA Leadership Workshop.  ACA member-only event / pre-event seminars open to the public.  Location: Ohio Union, Ohio State University, Columbus, Ohio.  Leadership Workshop $325pp / Pre-Event Seminars $90pp.  To register, visit: http://www.angelcapitalassociation.org/2014-leadership-workshop/registration/

September 24 (Wed):  BWA Dinner Deal Review Meeting, 5:00-9:00pm, (Angel Overview, 4:00pm, precedes reception and dinner meeting).  Non-Members $40pp.  Location: Apple Mountain Conference Center, Board Room, Freeland.  To RSVP, contact Judy Morrison at 989-771-1007, or via email, jmorrison@ip3inc.com.

Presenters Include:  foodjunky and Harrietta Hills Trout Farm (syndication with NMA and Muskegon Angels).

September 30 (Tues-New Date! ):  MMIC Workshop, “Access to Capital:  Fundamentals of Angel Investing”.  Workshop led by Ken Kousky.  Time: 3:00pm-7:00pm (Dinner included).  Location:  MMIC, Room 112, 2007 Austin, Midland, MI, 48642.  To register, visit www.mmic.us.

October 9 (Thurs):  BWA Pitch Night, 6:00-9:00pm, (Angel Overview, 4:30pm, precedes reception).  Hors d’oeuvres & Cash Bar.  Non-Members, $20pp, Location TBD.  To RSVP, contact Judy Morrison at 989-771-1007, or via email to jmorrison@ip3inc.com.

October 16 (Thurs):  BWA Screening Committee Meeting, 4:30-6:00pm.  Location: MMIC, 2007 Austin, Midland. To confirm attendance, contact Judy Morrison at 989-771-1007, or respond via email to jmorrison@ip3inc.com.

November 4-6 (Tues-Thurs):  The Accelerate Michigan Innovation Competition is an international business competition designed to highlight Michigan as a robust and vibrant venue for innovation and business opportunity.  Competition Winners are announced on November 6, 2014.  The competition is open to any early stage business.  Application Fee is $100. The $500,000 Grand Prize consists of $250,000 as a cash award and $250,000 as a convertible note.

To Register:  https://acceleratemi.fluidreview.com/, or call 313-446-0300.

November 20 (Thurs):  BWA’s Annual Meeting, 5:00-9:00pm.  (Angel Overview, 4:00pm, precedes reception and dinner meeting).  Location TBD.  To RSVP, contact Judy Morrison at 989-771-1007, or via email to jmorrison@ip3inc.com.

December 9 (Tues):  BWA Dinner Deal Review Meeting, 5:00-9:00pm, (Angel Overview, 4:00pm, precedes reception and dinner meeting).  Non-Members $40pp, Location TBD.  To RSVP, contact Judy Morrison at 989-771-1007, or via email to jmorrison@ip3inc.com.

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Karen Letain

kletain@bluewaterangels.com
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