Venture In The South

E113: Maybe you had a Startup Investment Exit, or know someone who did, that wasn't as lucrative as you expected. The target return may have been 10X or greater but after the dust settled your proceeds were more like 1.2X. You generally can attribute that outcome to the known risks of Early Stage Startup Investing, but sometimes it's the deal terms that bite.

David and Paul discuss their experience with some deal terms that bite, bad behavior that exploits some deal terms, and what an investor might be able to do to mitigate those deal term risks. (recorded 4/4/24)

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We invite your feedback and suggestions at www.ventureinthesouth.com or email [email protected].

E112: Luminelle is a surging FemTech startup that was recognized by VentureSouth for >100% YoY revenue growth, albeit from a modest base.

2023 was a breakout year for luminelle because they completed all FDA medical device regulatory requirements, achieved third-party payor acceptance, and gained provider acceptance as the new standard of care for office based uterine diagnostics without anesthesia using  their patented micro hysteroscopy system. They are  now focused on sales and developing a national partnership with an established industry player.

David interviews CEO Allison London Brown for an update on luminelle. Allison previously was on E56 in March of 2023 when she laid out the luminelle story. Today she's talking about the key events that enabled doubling revenue in 2023, why she expects to more than double revenue in 2024, and key sales developments that will propel luminelle to an exit. Watch the office  procedure performed without anesthesia with the luminelle system. (recorded 3/27/24)

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We invite your feedback and suggestions at www.ventureinthesouth.com or email [email protected].

E111: The Expanding Access to Capital Act of 2023 (HB2799) is a proposed bill tha recently passed the US House of Representative. It would substantially change how startup investing works in the US.

It would change the basic definition of an accredited investor, change how both small and large startup funds operate, and lower regulatory burdens. The stated goal is to increase available capital for startups while lowering the barriers to entry for small investors so as to democratize startup investing.

Startup investing is mostly the domain of wealthy accredited investors, as non-accredited investors can only participate via crowdfunding (at much higher investor cost). Co-hosts David & Paul discuss this legislation, the many effects that might be expected, and the potential for passage into law.

We think it will be modified in the Senate to address some peripheral Democratic political concerns around gig labor and investor risk. However, the upcoming 2024 election cycle is likely to delay a deal until after the election. 

For some context, on December 21, 2011, the SEC adopted amendments to the definition of accredited investors, requiring that the value of a person’s primary residence be excluded when determining whether the person qualifies as an “accredited investor” based on having a net worth in excess of $1 million. The regulation change is estimated to have removed over 20% of previously-eligible households from the market. Check out this study of the impact of  investor protection regulation changes from 2011. (recorded 3/12/24)

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We invite your feedback and suggestions at www.ventureinthesouth.com or email [email protected].

E110: Gradient Health has had a blow out year consistent with the AI economy at large.

As a data provider for AI training and validation for foundational models in medical imaging, they have enjoyed explosive growth with >100% YoY revenue growth for 2023 and forecasting even greater revenue growth for 2024.

David previously interviewed CEO and co-founder Josh Miller about his company in E55 in February 2023, and today he gives us an update on their growth in 2023. Josh discusses the GH business model, the growth in the AI data market, their value proposition, and their competitive advantage. We close with a discussion of his revenue projections for 2024 and potential exit milestones for acquisition. (recorded 3/12/24)

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We invite your feedback and suggestions at www.ventureinthesouth.com or email [email protected].

E109: Sharpen is a digital therapeutic and training tool for the best ideas in mental health. Its a social-ecological model approach to mental health literacy where all tiers of individuals are trained with age-appropriate, de-stigmatized content. They use peer-focused documentary film-based trainings created in collaboration with community members and researchers for: Screening & Monitoring, Content & Training, Crisis Response & Treatment using peer-focused documentary film-based trainings created in collaboration with community members and researchers. Sharpen has created a platform for individualized engagement and supervised training with a library containing over 600 modules on over 200 mental health topics including over 4,000 peer-based videos.

CEO and cofounder Robyn Hussa Farrell updates our initial show on Sharpen (E86 in October 2023) and explains how they achieved >100% YoY revenue growth in 2023, their fundraising plans and an exit trajectory.  (recorded 3/8/24)

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We invite your feedback and suggestions at www.ventureinthesouth.com or email [email protected].

E108: Angel Investors are everywhere but only represent about 7.5% of all accredited investors. Given that diversified early stage startup fund results equal or exceed many other capital investment strategies (Public Equities, Bonds, Private Equity, & Real Estate) with a >20% 10 year average IRR, why aren't more accredited investors including early stage startups in a diversified portfolio?

The available data is not clear and a 10 year investment cycle doesn't fit all investors, but perhaps the principal barrier-to-entry for early-stage Angel Investors is knowledge. Most accredited investors don't (yet) know how to learn about startup investing, how to do diligence, how to develop deal flow, and how to execute a long term strategy.

In today's show David interviews Marcia Dawood, an experienced Angel Investor who has her own podcast about Angel Investing, The Angel Next Door. She tells her story and how others can do the same. (recorded 2/1/24)

Also check out her forthcoming book, Do Good While Doing Well, available here.

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We invite your feedback and suggestions at www.ventureinthesouth.com or email [email protected].

E107: Hey parents, it turns out you're never too young to innovate!

Mother and daughter team Rozalynn and Gabby Goodwin set a new standard for innovation when Gabby pushed her mom to help her solve a common hair care problem with GaBBY Bows when she was just 7 years old. Over the last 10 years, the team has developed multiple patented hair care products that solved an unmet need and grown that business into the brand Confidence. 

Gabby is now 17 and graduates High School next year. She's using the Confidence brand to finance her college education and as a career springboard for her future. Gabby has appeared in multiple media profiles and has been recognized with multiple entrepreneurship awards. 

Having raised funding from VentureSouth and other Angels, the Confidence brand has expanded into new products and services, and partnered with celebrity influencers to grow the brand. (recorded 2/14/24)

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We invite your feedback and suggestions at www.ventureinthesouth.com or email [email protected].

E106: The Angel Investor Ecosystem has grown from modest beginnings to a robust national ecosystem thanks to Angel Groups such as Queen City Angels in Cincinnati and the Angel Capital Association.

David and Matt Dunbar interview Tony Shipley, the Chairman and Co-founder of Queen City Angels (QCA) in Cincinnati and the Chair Emeritus of the Angel Capital Association (ACA), about those organizations' roles in the Angel Ecosystem. 

Tony walks us through the beginning of QCA and the ACA, how they have evolved over time. He also talks about the six Angel Funds managed by QCA and how they have responded to their Angel Investor members interests in structuring, funding, and executing deals. (recorded 2/12/24)

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We invite your feedback and suggestions at www.ventureinthesouth.com or email [email protected].

Startups and Venture investing seems to have come to a crossroads in 2024, with many venture funds and founders that have much in common but maybe not so much when it comes to innovation.

The Brick Yard is innovating Southern Venture with an In-Residence Seed Stage Fund focused on a select group of founders, supporting them to a Series A.

David interviews General Partner Cam Doody about the Brick Yard strategy, what distinguishes it from other incubators and VCs, and how they make it work. They are planning on around 40 In-Residence startups over about 4 years working heads down on product market fit on their way to a Series A raise. Brick Yard is selective but takes a hands off attitude toward founders who they feel perform the best in their unique environment. They are currently deploying an ~ $20M fund raised in 2022 and expect to raise a second fund in 2026. 

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Connect On LinkedIn with Paul at

https://www.linkedin.com/in/paulclarkprivateequity/

We invite your feedback and suggestions at www.ventureinthesouth.com or email [email protected].

In this bonus segment we discuss an special opportunity for investing in a company into which we have previously invested in their Seed round. Now we are investing in their just announced Series A.

We can't name the company on the pod due to SEC 506c rules which limit public promotion to Accredited Investors, but we can discuss the impressive metrics and reasons why we're investing again. You can get all the specifics by joining the RollingSouth Syndicate on AngelList or by contacting David or Paul directly. 

*Paul misspoke in this episode. He meant SPV means "Special Purpose Vehicle" (not Single Purpose Vehicle). Slips like this are one reason why he isn't running for President.

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Connect On LinkedIn with Paul at

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We invite your feedback and suggestions at www.ventureinthesouth.com or email [email protected].