There isn’t a much better introduction to entrepreneurship than being the first intern that Lebron James ever had. Ashlee Ammons holds that title. But, now her title is the founder of Mixtroz.    Of course, working under the King James branding machine taught Ashlee all kinds of lessons. Other lessons, like the importance of working hard, she learned from her Mixtroz coffee-founder. Which happens to be her mother.   Having spent a significant amount of time in the events industry, Ashlee had spent her fair share of time at mediocre events that left the attendee wanting more. In fact, even for someone as extraverted as Ashlee, the whole networking experience at events seemed forced, or random at best.   So, in the way that most founders get started, Ashlee decided to solve her own problem and Mixtroz was created.   Mixtroz is a live event networking app that pairs event attendees together based on a variety of factors. Attendees download the app and are then asked to complete a series of questions, chosen by the event host, that are used to recommend someone to network with.   In this episode of the SouthFound podcast, Ashlee shares how Mixtroz came to be and the struggles of being a minority startup founder in the South. Plus, we talk about their recent Rise of the Rest win and the way Ashlee crafted her pitch specifically, and brilliantly, to appeal to the judges.

Jessica Buffington, the founder of HelloHome, was involved in the real estate industry during the Great Recession. During that time she was working with large national banks on the liquidation of their foreclosure properties. But she wanted to give back.   As a realtor, Jessica knew that the business was all about trust. She also knew that there had to be a better way to help clients sell their homes without eating up a lot of their equity with real estate fees.    With the idea of giving back, Jessica created HelloHome. The company helps home-owners sell their home using a flat fee structure.    That fee, $3500, saves the average homeowner $8,000 in commissions!   The solution is also a win for real estate agents. Part of the HelloHome model is contracting directly with the home-owner and then matching them, through a proprietary algorithm (that looks at location, experience, and even personality), with the right real estate agent. The company is currently operating in 89 cities across the United States.   Investors are beginning to take notice. As Jessica and HelloHome have been able to raise over $350,000, while she has personally retained 94% ownership of her company!   Listen in as Jessica shares her personal story and the evolution of HelloHome.    To connect with her be sure to visit here.

On this episode of the SouthFound podcast, I talked with Alex Lewis of Electro-Active Technologies.   Like some other past guests, Alex was originally involved in the startup industry on the West Coast of the United States. However, he found a home here in the South at the University of Tennessee where he completed his Ph.D. studies.   During his Ph.D. research, Alex and his co-founder came across a way to a way to convert waste into hydrogen. That hydrogen can be used in a variety of ways, including as a fuel source. Due to the nature of their research, the company has licensing agreements with the University of Tennessee Research Foundation (UTRF) and Oak Ridge National Lab (ORNL).   Alex credit those two organizations, along with the Bredesen Center, for drawing him to this area. However, once he got to Eastern Tennessee he learned about all the other various resources that are available to entrepreneurs and startups.   They include:

• the Knoxville Entrepreneur Center
• LaunchTN
• the Tennessee Advanced Energy Mentor Network

  The company is currently seeking funding from a variety of grant opportunities, including SBIR grants. Which Alex points out requires a different sort of skill set versus traditional venture capital.   To learn more about the company head here.

In this episode of the SouthFound startup podcast, Pat Gibson of RapChat shares his background and entrepreneurial journey. Including opening for rappers like Wiz Khalifa and others.    Pat Gibson, or P Holla as he is known in the rap world, was always a musician. In fact, playing in a band was something he was used to doing. But something about rapping appealed to him. Especially after the first time, he decided to drop his own beat during a practice session.   It wasn’t long before he was hooked and rapping became a regular habit for P Holla and his friends.    The challenge is that there was no easy way to record your rap sessions and share them with your friends.   Thus, RapChat was born.   RapChat is a mobile app, available on iTunes and Google Play, that provides you with free beats, a mobile recording studio, and a platform to aid in being discovered.   RapChat and Pat are 500 Startups and TechStars alumni, having been through their accelerator programs. Which Pat says played a huge role in their evolution. In fact, one key turning point came when they were encouraged by advisors at TechStars to not require users to have the RapChat app in order to listen to a recording. That one decision opened up the floodgates for the team and user growth skyrocketed.   If you’d like to connect with Pat you can connect with him on just about any social platform under P_Holla.

Welcome back to the SouthFound podcast!

In this Season 4 opener, I talk with Connar Benson-Epstein.

Connar is a former collegiate football player turned self-proclaimed numbers geek. Connar focused his undergraduate studies on Finance, Accounting, and Economics before wrapping up his education with an MBA.

He spent his early post-graduate days as an intern in Silicon Valley studying their startup ecosystem and later spent time in places such as China, Dubai, and Boston (which he names as one of the best startup ecosystems).

Connar has recently moved back to Eastern Tennessee and has found himself to be presently surprised with the progress the area has made in the startup industry. 

Listen in as he shares his story and why the South is a great place to start a business.

To connect with Connar you can find him on:

• Instagram

Hi, there!

This week I am wrapping up Season 3 of the podcast and sharing some details about Season 4. 

Including possible changes to the format (back to more interviews) and a story about a little girl that changed my life this week.

Look for Season 4 in about a month.

If you know of an entrepreneur or startup who would like to share their story please send them here to contact us.

As always, thank you for being a loyal listener.

So far this week we have been talking about real estate-based investing. Today I want to share with you how borrowing money to invest in the stock market works.   Borrowing money to invest or “on margin"   Borrowing money to invest happens all the time. When you do so through a trading platform it is called “on margin”. For example, if you have a trading account with TD Ameritrade or any of the other online trading platforms they will allow you to borrow money to buy stocks with.   Lenders will also consider allowing the borrowing of money to invest. However, when a traditional lender does so they discount the value of those stocks heavily.   Cut in half   Let’s look at an example of how a lender, not a stock account, might lend you money.   For this example, we will assume that you have $100k in stocks in your trading account. Most lenders will provide you about $50k against that value in your stock account. That means that they are cutting the value of your account in half. Why is that?   Well, lenders know that the stock market can be extremely violative and they hedge their own bets by limiting the loan amount they will give you in anticipation that the value could drop quickly. I would say that is a lot of hedging, considering the last time the market dropped 50% was….well, it is extremely uncommon.   Another limitation the lenders use to protect their own position is by often only using the best of stocks as collateral. Here they may only count the value you carry in “blue chips” or well-established companies like Apple, Google, etc.    So, if your $100k stock trading account is made up of $20k in penny stocks then the lender is likely to only consider lending against the other $80k. Using the 50% loan-to-value average you are looking about only being able to get a $40k loan versus the original $50k in our example.

Real estate investing loans   Lenders, by nature, are risk adverse. They like to make loans where they have a relative level of comfort that they will be paid back. So, getting real estate investing loans approved can be a challenge. Today, I want to share how real estate investing loans work and how to best go about getting approved for them.   More specifically, I want to talk about investing in rental real estate. Not real estate that you purchase for your own, or your businesses, use.   OO versus NOO   One note on that - any property where you occupy more than 50% of the square footage is considered owner-occupied. Anything less is called non-owner occupied. The key significance is the percentage of funding a lender will provide.    For example, on owner-occupied properties lenders will often fund up to 75-80% of the value or purchase price, whichever is less. On non-owner occupied properties that percentage falls to 65-75%. On a large loan that percentage difference can mean you are coming up with some significant cash down.   The property should stand on its own   Ok, now that we have determined we are talking about NOO properties today, let's talk about what a lender is looking at when they are evaluating real estate investing loans.   You may recall that getting approved for a loan is almost always about proving the ability to repay the loan. And the primary source of repayment is cashflow. So, in the case of rental properties, the lender is going to gauge the properties ability to make the loan payments without any assistance from you as a guarantor.    Meaning, the rental income you anticipate earning or already have in place through an existing lease, should yield a profit when compared to the loan payment and any associated expenses.    Those other expenses will include some consideration for potential vacancies (usually 5% of annual income) and a property management company (another 5-10%) if you plan to use one.   Next up   Coming up this Wednesday on the podcast I will be talking about real estate development and construction loans associated with land.

This week I have been talking about some of the popular early-stage startup founding vehicles. On Monday we talked about convertible notes and on Wednesday I covered the more popular SAFE funding option.   While the SAFE was created by the folks at Y Combinator, the Keep in Simple Security, or KISS, funding vehicle was created by another popular incubator team at 500 Startups.   This funding option is also designed to make the use of convertible notes even more simple, as the name eludes to.   What is a Keep it Simple Security?   The KISS is even more focused on simplifying the startup funding process through convertible notes by making the legal  process of closing such a deal easier.   One of the biggest expenses in closing a round of funding with an investor can be the legal costs associated with the deal. The KISS documents were specifically designed to be open sourced, short (less than ten pages in length), and extremely flexible.    My one concern is that with the flexibility you often leave the opportunity for each side to add too much customization to an agreement. Hopefully, the team has addressed this by limiting the conditions that can be added to the document.   I did note that the KISS legal documents come in two separate formats. One each specifically for debt-based or equity-based funding rounds.   Next up   Normally I have my episodes all scheduled out in advance. But next week that isn’t yet the case. So, here is your chance to request topics you’d like to see me cover. Tag me over on Twitter if you’d like to suggest a topic.