Biz Plan Buzz
News, views, and events
in the Pacific Northwest
entrepreneur community
by Bryan Brewer
July 23, 2004

Conventional wisdom says it takes at least six months to raise a first round of capital for a startup. Don't bother telling that to Don Hirtzel, CEO of First Sound Bank, which opened its doors Monday in downtown Seattle. The new bank raised $20 million -- touted as the largest capital base ever for a startup bank in the area -- in about three weeks through Portland investment firm D.A. Davidson & Co. Banking veteran Hirtzel and President Steve Shaughnessy told me they were gratified at the quick response to their business plan, which features a very strong management team focused on an underserved niche market. This new commercial bank targets firms that borrow between $500,000 and $2.5 million annually and have sophisticated cash management needs.

That's the title of a recent article in Entrepreneur magazine by David Worrell outlining three alternative sources of capital if banks and VCs are out of your reach. He focuses on "hidden" personal wealth (life insurance policies, retirement plans, etc.), angels (more than 400,000 active individual investors in the U.S.), and commercial finance companies (less regulated than banks, but they still require collateral assets or adequate cash flow).

I would add two other commonly overlooked source of funds -- your suppliers and your customers. Can you negotiate delayed payment to vendors or other creditors ... just by asking? Can you get advance payment from customers by offering exclusives or incentives? Some creative cash flow management may supply the extra dollars your business plan needs.

If you think nanotechnology is science fiction found in other parts of the country far, far away, think again. Researchers and business people from the Northwest are gathering in Portland next week to map out this region's nano-future at Micro Nano Breakthrough Conference 2004, July 28-29. Co-sponsored by Pacific Northwest National Laboratory and Oregon State University, the two-day event will cover the latest nanotech developments in energy, defense, health care, and electronics. (Look for a full report in the next issue of Biz Plan Buzz.)

Did you know ...? The first place to offer a Ph.D. in Nanotechnology is ... the University of Washington. Grad students in science, engineering, or medicine can opt for a concurrent nanotech doctorate with multidisciplinary studies under more than 70 faculty members.

Attendees at a recent Northwest Entrepreneur Network breakfast in Bellevue were treated to an entertaining talk by Renée Behnke, President of Sur La Table. During a lively discussion of the ups and downs of transforming this local retailer into a chain of dozens of stores nationwide, Renée told of her mother's advice about coping with age:

"Age is relative. You just get younger friends, and then you feel really good ... or really bad."

• Boise: the newest city of "angels" -- The Boise Angel Alliance held its first meeting June 24, 2004, attracting about 50 investors and three startup presenters.
• Venture capitalists muse on new blog -- Martin Tobias, venture partner at Ignition Partners, encourages others to join him in discussing "... business, companies, interests, trends and any other random thing that hits us" at the new NW Venture Voice.
• Big Name VCs Invest in Seattle Firms -- by John Cook, Seattle P-I, July 16, 2004. VCs from others parts of the country lead four local investments totaling $97 million.
• Pitching Across America -- Funding Post hosts "the largest online venture competition ever." Application deadline is Aug. 15, 2004.

One of the most common investor complaints about business plans concerns entrepreneurs who ramble at length about markets or technology and then, only after many pages, spell out what the business actually does. A good executive summary will contain a concise statement of the business model in the first paragraph, and will give all the pertinent details in no more than two pages. (It's not an issue of "short attention span" as some pundits advise; it's really more about producing clear, smooth, and compelling narrative that builds excitement for a potential investor.)

• July 28, Portland -- OEF Business Plan Seminar
• July 28-29, Portland -- Micro Nano Breakthrough Conference
• Aug. 11, Portland -- Leaders and Innovation in Technology Luncheon
• Aug. 13, Seattle -- NWEN Breakfast, "Telling Your Story: Becoming an Effective Spokesperson for Your Venture," Steve Pool, KOMO-TV
• Aug. 17, Seattle -- WSA Networking Reception, Woodland Park Zoo
• Aug. 17, Seattle -- Pub Night at the Pyramid (NWEN members only)
• Sept. 15, Bellevue -- MITEF Dinner, Ann Winblad, Hummer Winblad Venture Partners
• Sept. 23, Portland -- OEF Entrepreneurship Awards, Oregon Convention Center
• Oct. 6-7, Boise -- 6th Annual Intermountain Venture Forum

MITEF = MIT Enterprise Forum
NWEN = Northwest Entrepreneur Network
OEF = Oregon Entrepreneurs Forum

PLEASE FEEL FREE TO FORWARD THIS NEWSLETTER
TO YOUR FRIENDS AND ASSOCIATES.

Click here to subscribe.