When we started Hyde Park Angels in April of 2007, we had several themes. One was that we saw a huge donut hole between start up funding and venture capital funding. Companies had no where to go-except the coasts. There were private networks in the midwest that did start up funding. However, those networks were hard to penetrate, disjointed and expensive to access. HPA created a unified place that made start up funding very efficient. The time invested by the company seeking funding is less, and the time researching the company and performing due diligence for the investor is significantly less too. Plus, the investor gets the power of easily accessing other investors for their opinion. It’s like having the “power of crowds” for company analysis.
Government has always tried to create the community here in the midwest. How many “Silicon Prairies”, “Golden Corridors” and similar grand sounding names have we heard, with no results? But, government can’t create the community. All good government should do is eliminate rules and regulations, eliminate taxes, and let the community build the networks and go to work. HPA is not only about investing in companies, we are about building a self sustaining entrepreneurial community. This idea is why we were excited to participate in the Excelerate Labs exercise last summer. By the way, we have participated in financing many of those companies. That’s why we were encouraged when we saw this post at the Technori blog. The following is an excerpt, but click the link and read the whole thing. It echoes everything we have stood for since our inception.
“The need to come together as one business community has never been greater than it is now. In 2011 there is going to be a continuing explosion of new startups to follow up on the growth in 2010. In addition there will be new initiatives and events all centered around the promotion of entrepreneurship and the exploration of technology.
While this may give some sense of interconnectedness, a true community does not come from there.
A true business community must be built upon a foundation of openness and trust; a sense of shared purpose found not in the common desire for one’s own success, but in the desire to build a foundation upon which the success of one company can impact a hundred.
It’s the smallest interactions, when placed in the context of thousands of participants, which lay the groundwork for true community.
It’s the successful CEO sitting down for a coffee with a new startup to help them create a revenue model. It’s the local entrepreneur making introductions to associates he trusts on behalf of someone. It’s a company opening up their spare desks for new startups to use.
One of the most intriguing aspects of the above actions, is that they already occur in abundance in Chicago. However, they need to not only occur more, but we as a community need to start talking about how open we really are.”