Presents

Crowdfunding Webinar Mini-Series
Upcoming Webinar:
"Crowdfunding, Small Business, and the Federal Securities Laws"
April 18, 2012, 1:00-2:30pm ET
Presenter:
C. Steven Bradford
Earl Dunlap Distinguished Professor
University of Nebraska-Lincoln
College of Law

Crowdfunding—the use of the Internet to raise money through small contributions from a large number of investors—could cause a revolution in small-business financing. Through crowdfunding, smaller entrepreneurs, who traditionally have had great difficulty obtaining capital, have access to anyone in the world with a computer, Internet access, and spare cash to invest. Crowdfunding sites such as Kiva, Kickstarter, and IndieGoGo have proliferated, and the amount of money raised through crowdfunding has grown to billions of dollars in just a few years. But the use of crowdfunding for business financing in the United States is limited by federal securities law. If businesses sell debt or equity using crowdfunding, this triggers the offering registration requirements of the federal Securities Act. Registration is prohibitively expensive for the small offerings that crowdfunding facilitates and none of the current exemptions from registration fit the crowdfunding model. In addition, the web sites that facilitate crowdfunding may be treated as securities brokers or investment advisers, subjecting them to expensive regulatory requirements as well. Professor Bradford will discuss the promise and potential pitfalls of business crowdfunding, the regulatory issues under federal securities law, and proposals to exempt crowdfunding from those laws.

To register, click here

In recent months, state and federal policy makers have launched a broad set of innovative programs aimed at accelerating technology transfer, the commercialization of government- and university-created intellectual property, or IP, through licenses and business startups. This fall, for example, the Obama administration directed federal agencies and labs to measure and expand their technology transfer efforts.  At the state level, Gov. Martin O’Malley’s (D-MD) Maryland Innovation Initiative, announced in January, would provide seed funding and foster greater cross-university collaboration to help close the state’s gap between its research levels and commercialization results.

Some universities, too, are rethinking their policies. Penn State, for example, announced in December that the university is no longer required to own intellectual property created by industry-sponsored research. “In short we consider the net present value of the interactions and relationships that our faculty and students have with industrial professionals to be real and therefore greater than the apparent future value of the proceeds from such IP,” wrote Hank Foley, Penn State’s vice president for research, in announcing this news. “Our goal … is to flatten any and all barriers or impediments to innovation and that includes our own past stance on intellectual property."

Next January, unless Congress and the White House take action, the National Institutes of Health, or NIH, and the critical medical research it supports will face an uncertain future. Under current law, most domestic spending, including every NIH institute and center, will be subject to a mandatory cut of at least 7.8 percent.

The cuts—which will go into effect January 2—are the result of the Joint Select Committee on Deficit Reduction’s failure to come up with a plan that would reduce the deficit by $1.2 trillion over the next decade. The debt limit deal, which created the committee, established a backup “sequestration” procedure as a mechanism to encourage compromise. Sequestration is a form of automatic budget cuts that are applied across the board.

Social entrepreneurs are notoriously creative—you have to be to concoct a venture that makes doing good profitable. But when they launch their businesses, many entrepreneurs discover that innovation was the easy part.

The learning curve is sharp when you’re building a company in an emerging sector. You’ve got to find investors willing to measure returns in social impact and dollars. Plus, to really make that impact, enticing new customers becomes key. Finding a fertile ecosystem of support—and methods for facing these challenges—leads many early-stage social entrepreneurs to universities and accelerators dedicated to growing impactful business.

If health care costs are ever to be brought under control, the nation’s doctors will have to play a leading role in eliminating unnecessary treatments. By some estimates, hundreds of billions of dollars are wasted this way every year. So it is highly encouraging that nine major physicians’ groups have identified 45 tests and procedures (five for each specialty) that are commonly used but have no proven benefit for many patients and sometimes cause more harm than good.

Many patients will be surprised at the tests and treatments that these expert groups now question. They include, for example, annual electrocardiograms for low-risk patients and routine chest X-rays for ambulatory patients in advance of surgery.

Becoming an entrepreneur is a fun yet scary proposition. Often, entrepreneurs go against the advice of their friends and family members, in order to follow their dreams and pursue their passion. However, making that leap is a rocky road.

Here are four action steps that you can take right now to make the journey less bumpy:

1. Develop a Personal Mission Statement

A challenging yet exciting thing about entrepreneurship is that you are inundated with ideas and opportunities, but to be effective, you need to choose the ones that work best with what you want out of your life. Create a personal mission statement that will act as a decisive filter. For example, my personal mission statement is "to become a tycoon politically, socially, and economically so that I may have a positive impact on my community." When developing your own, you must ask yourself two questions: What core things are most important to you? Why are those things important? Your answers will help you figure out how to accomplish your goals. Remember that your personal mission statement is not set in stone, so tweak it accordingly as your life's priorities change.

A study of the sexes reveals that when it comes to starting a business, women are more likely than men to consider individual responsibility and use business as a vehicle for social and environmental change.

"We found that women are 1.17 times more likely than men to create social ventures than economic ventures, and women are 1.23 times more likely to pursue environmental ventures than economic focused ventures," says Diana Hechevarria, a doctoral candidate in management and entrepreneurship in the University of Cincinnati's Carl H. Lindner College of Business.

Brian Matthews has been launching technology companies in St. Louis for nearly 20 years, and he says the region has more momentum than ever.

The biggest threat to that momentum, he says, is a lack of cash. The region's bumper crop of promising startups need capital to keep growing, and they need it in amounts that may be hard to raise in St. Louis.

Capital Innovators, a downtown accelerator program, showed off a dozen technology companies that are seeking at least $7 million from investors. A half-dozen local medical firms, all of which started with help from the St. Louis Biogenerator, were prospecting for $40 million at last week's InvestMidwest forum.

Today more than ever businesses have to be innovative to be successful. What is innovation? Trompenaars & Hampden-Turner, (2010) states innovation is taking creativity and transforming it into something that has valued use. The word innovation like transformation seems to be over used everywhere. It gets used so much it has almost lost any real value. However, innovation is the key to enabling companies to be competitive through tough and tumultuous economies.

True innovation is born out of creativity. For an organization to unleash innovation it must first tap into its own resources of creativity. To transform a company or to innovate on a large scale requires creative thinking or thinkers to potentially change the game. The primary object then becomes how to find and unleash creativity within the organization. This must start with organizational leadership.

Accion, a pioneer and leader in global microfinance, today announced the launch of Venture Lab, an initiative dedicated to providing seed capital and management support to financial inclusion start-ups worldwide.

The USD10 million programme will seek out companies that have completed research and development and are at the pilot/first-revenue stage.  Investments will typically be in the range of USD100,000-USD300,000, invested either as convertible debt or equity.

This week, algae-biofuel startup Sapphire Energy announced it has received $144 million in new funding, which brings its total to over $300 million.

The company, which is less than five years old, has been moving quickly to build a 300-acre algae farm as a large-scale demonstration of its process for making algae oils. The U.S. government has supplied over $100 million of the investments, including a $50 million Recovery Act grant designed in part to spur job creation.

Google once brashly believed that its engineers could invent a solution to the world's energy problems. These days, the company has a new strategy: finance less risky clean-energy projects where it can actually make an impact.

Last year, Google invested more than ever in renewable power, spending $880 million to underwrite conventional clean-energy projects such as solar panels on California rooftops. But that isn't the role the company envisioned for itself in 2007, when cofounder and current CEO Larry Page declared that it would get into energy research directly, intending to "rapidly" invent cheap ways to generate "renewable electricity at globally significant scale."

For entrepreneurs, navigating a career through the Valley can be a lot like competitive sports. Similarities include locker room leadership, a shifting playbook and ongoing onslaughts from opponents. What is perhaps the most important likeness to highlight, however, is the requisite sense of what your place is in the game.

Know Your Role: Player, Player-Coach or Coach The differences between each role in a company and team are substantial, and shifting between them requires a lot of adjustment, sacrifice, and changing skill sets. Players focus on their own performance while coaches manage for peak performance of the team as a whole, and player-coaches do a little of both. I’ll give you a personal example: I initially found my place as a player on a Sales team. I moved into pure coach mode when I was promoted to VP of Sales, and then split my time between coach and player when I transitioned into an entrepreneurial startup. When I became the CEO of a later-stage tech company, it was back to coach mode.

Thomas Edison's record as an American inventor seems hard to beat if Hollywood wants a historical hero — he pioneered practical electric lighting, spawned the sound recording industry and created the first commercial system for motion pictures. "The Wizard of Menlo Park" captured the public imagination with his awe-inspiring inventions and swam through a sea of celebrity as easily as Tony Stark, the superhero Iron Man of comics and films.

But Edison's greatest legacy may be as a founder of modern innovation, the process of turning an invention idea into a fully realized and patented commercial product. His early knack for entrepreneurial success gave him the wealth and investor backing to transform small inventor's workshops into the huge research-and-development laboratories of today. He even helped found U.S. military labs such as the Naval Research Laboratory.

Did you ever wonder why some entrepreneurs always seem to have all the luck and success, while others never seem to catch a break? As an Angel investor, I quickly learned that luck has very little to do with it, and I now look for some personal characteristics and leadership styles that separate the potential winners from the losers.

These differences are the reason that investors say that they invest in people, rather than ideas. As I was reminded recently in a new book by Dennis Perkins, “Leading at the Edge,” this isn’t a new concept. He illustrates this by comparing the acts of numerous teams which faced the edge of life and death as early Antarctic explorers in the 1800s.

Two seed-stage investment funds that were announced in the District last week will funnel money to fledgling ventures that can’t yet attract larger, institutional financiers. But the similarities seem to stop there.

In many ways, they reflect the diversifying nature of venture capital, particularly at the earliest stages when an upstart often requires less money to prove its viability.

Acceleprise

A new accelerator program, dubbed Acceleprise, plans to open its doors in July to provide $30,000 and four months of mentorship to firms that sell software and other technology to large organizations.

Measuring innovation can lead to unintended consequences.  Here are eight ways to avoid the traps.

1. Measure innovation alternatives, not just the current program.  When assessing the impact of an initiative, always ask, "compared to what?"  Don't fall into the trap of measuring only what the company is doing today.  Rather, measure it against the next best alternative.  For example, if you are using a ideation methodology like S.I.T., be sure to measure the effectiveness of using S.I.T. versus another ideation method.  Understand why you are using one method over another by forecasting results from the alternative.  This re-frames the question from "does this method work?" to "does this method work better than this alternative?"

How one man changed his life, and impacted thousands of others with 52 ways to make every Monday matter.

If I've learned anything over the past ten years, it's that the old saying, "It’s far more rewarding to give than it is to receive" is very powerful.

I was recently invited to mentor a group of emerging social entrepreneurs, all whom are focused on business models geared towards improving the lives of others, at an intimate conference called Praxis. While I was going there to help and guide others, I left with the gift of being inspired, challenged and full of hope.

What are the secrets from the happiest people on Earth? Some make sense: Be wealthy, married, and have a job. From there, though, it gets more complicated.

Happiness isn’t easy to quantify, but a lot of people have tried: Bhutan has its Gross National Happiness survey, global research company Ipsos has its annual world happiness poll, and now Columbia University’s Earth Institute has put out the first World Happiness Report, which has the ambitious goal of surveying the state of happiness in the world today and looking at how the science of happiness plays into it.

The report, commissioned by the United Nations Conference on Happiness (yes, that exists), contains over a hundred pages of musings on world happiness. Here’s an ultra-abridged version of the findings.

Forty-two U.S. venture capital funds raised $4.9 billion in the first quarter of 2012, according to Thomson Reuters and the National Venture Capital Association (NVCA).  This level marks a 35 percent decrease by dollar commitments and a 9 percent decline by number of funds compared to the first quarter of 2011, which saw 46 funds raise $7.6 billion during the period.  The top five funds accounted for nearly 75 percent of total fundraising this quarter as the number of funds raising money during the quarter fell to its lowest levels since the third quarter of 2009, when 36 venture capital funds saw new capital commitments.