Generating capital is essential to building a successful business and there are many public and private options available such as angel investors, debt financing, government programs and seed funding from programs such as Innovation Guelph’s Fuel Injection program.
Local entrepreneurs had the opportunity Friday to hear fund-raising stories firsthand from six successful business people during an early-morning panel discussion organized by Innovation Guelph called, Lessons From Leaders: What I’ve Learned About Bankrolling a Business.
Robert Menegotto opened the discussion with stories about building his company Mantech Inc. that develops and manufactures water analysis and monitoring systems.
Menegotto has been very successful but said he might have avoided mistakes if he had been more open to advice from others.
“My first mistake along the way as far as mentors and talking to people is, I listened to only one person,” he said. “That was a big mistake. Talk to lots of people, family, friends, talked to lots.”
Matt Wittek is the founder and director of Guelph-based company, Cupanion, that develops environmentally sustainable technology and products.
He became an entrepreneur at 32 and in five years has built Cupanion into a multi-million dollar business. He advised people to be ready to look for outside investment, to prioritize, know your mission and be patient.
“The fuel of any successful business is money,” he said. “Being an entrepreneur was always my dream and thank goodness I have a loving wife and family that support that dream.”
Caitlin MacGregor is the CEO and co-founder of Plum out of Waterloo, an employment consulting company that uses artificial intelligence and organizational psychology to help companies hire the best people for the job.
She and her husband started the company six years ago. They have raised $2.2 million to date and are on target toward $5 million.
“I was able to build something from nothing and that is when I knew I was an entrepreneur,” she said.
She emphasized the value of generating “social clout” and said the more you can stand out from the crowd the more likely it is you will attract potential investors.
“One of the ways to stand out from the crowd is to really leverage the social club,” she said. “Before you even go to ask for money you need to already have someone from the community that believes in you.”
Michael Litt is CEO and co-founder of Vidyard a six-year-old Kitchener-based startup that transforms business communication using online video. The company has raised more than $90 million and now runs an angel fund that has made 65 investments in the past two years.
“You are investing in the people not the idea necessarily because the idea is going to change with the challenges of the market,” he said. “The most important thing I can say is do not go in with your hat in hand asking for money from someone you are meeting for the first time. It is going to take time. You have to invest in that relationship. Through building those relationships you will get introductions to amazing people and subsequently start raising cash.”
Spencer Waugh, CEO of AceAge, developed an automated medication dispenser business that has, to date raised $2.7 million.
“There are two main lessons,” said Waugh. “One, you have to find the right investors. People who know the space and see the business need. Second, you need to have the right deal.”
Caroline Bolduc, CEO and founder of Bold Canine that produces natural raw food for cats and dogs in their plant in Erin. Before starting her business she was working full-time and training dogs on the side.
“I became an entrepreneur on a whim,” she said. “One day my boss pissed me off and I quit.”
She started making pet food and selling it out of her garage and has since grown the business into a multi-million dollar company with 25 employees.
She told a story about getting a friend to help her finalize a $250,000 financing deal with OMAFRA and the bank.
“I am part of a triathlon club and I was at the pool in the lady’s changing room and I talked to a woman who offered to lend me money,” said Bolduc. “I emailed her last week and said, ‘remember that time at the pool when we were naked and you offered to lend me money’. She agreed and on Monday morning I am getting a cheque. There is a lot of money out there if you are open to it and remember the people who can help you along the way.”