Funding

The investment process comes with many challenges and rewards. As an investor, it's up to you to overcome the challenges and reap the rewards, but how do you do it? One simple tactic that always helps is asking questions!

When it comes to investing, you don’t just need to ask questions, you need to ask the right questions. The questions that you ask during the due diligence process can give you an insight into the companies and teams that can help you make your final decision to invest in a company.

Norman Boone has compiled a list of questions every investor should ask themselves and entrepreneurs before investing. He is an experienced leader, entrepreneur, long-term angel investor, and member of the Keiretsu Forum NorCal region. He gave the keynote address at the Denver/Boulder chapter meeting at our May 2022 Roadshow.

Whether you're investing for the first time or have been investing for years, here are some key questions Norman asks himself and the entrepreneur during due diligence and before writing a check.

The most important Question Investors need to ask themselves! (With examples!)

Do you have space in your allocation?

If you plan to invest in a new business, it is important that you have sufficient funds allocated for the investment.

Do you love the product idea?

Does it appeal to you? Do you find it practical? If the answer to both of these questions is no, you need to reconsider your investment decision. Norman explained that Northern California-based Earth Grid is working on underground tunnels almost as large as roadways, and he thinks they will eventually work with power lines, water lines, and more. This is a global opportunity as their competitor in the region PG&E (power company) has had major problems with fires on overhead power lines. Investing in the company could be a great opportunity to create more beauty and less harm to the environment.

What is the quality of management and the board?

Most fledgling companies probably don't have a board of directors at this stage of their growth. Norman went on to say that if the company has a board of directors, you need to look at how involved they are. Also, the quality of the team such as management, entrepreneurs, and core decision-makers. Norman cites the company Epilogue Systems as an example. When he joined Epilogue Systems as part of the due diligence team, he appreciated CEO Mike Graham's ability to act on recommendations and his willingness to accept feedback.

Is there an exit plan?

No sane investor wants to lose money on an investment. Therefore, it is important to assess whether the company has a clear plan and path towards an exit.

Is the Term Sheet fair?

The Term Sheet is an essential document that contains all investment terms. As an investor, it is important to understand the details of the Term Sheet and the financial terms contained within. It is necessary to read the Term Sheet frequently to ensure that you are getting the best deal from your investment. To make money from a company, it is imperative to understand the Term Sheet.

Operational Efficiency

Norman went on to ask, does the business model make sense for you? Can it be scaled? With the current business model, will the company deliver on its promises? Or do they need to change their operating structure as they grow? The more effective the business model, the more likely it is to succeed in the future.

Is the market ready for this innovation?

The market plays a significant role in the success of a company. As an investor, you want to know if this company is an attractive investment. You want to know if there is a large market for the product or service you are investing in and if that market is ready for innovation. Example: Turn Technologies is one of the companies that Norman believes has great technology and a way to connect gig workers with employers.

Competitive Landscape

Competitive landscape analysis is a proactive way to understand how a company competes with its competitors. By leveraging on its strengths, the company can make up the ground between itself and its competitors. 

Do the economics/financials make sense?

Understanding the numbers in a company's financial statements is a vital skill for investors. Meaningful interpretation and analysis of balance sheets, profit, and loss statements, and cash flow statements to identify a company's investment quality is fundamental to making informed decisions.

The impact of technology

A company's technology is critical to its success. Norman gives another example of Epilogue Systems. In his experience, their technology overwhelmed unicorn-sized competitors. He loves their management and their technology, what they do and how it makes them useful.

Here are Questions Investors Need to Ask Entrepreneurs 

The infographic below summarizes 4 key areas where questions can be asked.

Questions Investors need to ask themselves before finally writing a check

Even if investors like a company, there are a few other factors to consider before closing a deal.

• Is there room in your allocation?
• Have your questions been answered in a way that makes you feel comfortable?
• Will it help you build diversity in assets?
• Are you passionate about this company and its people?
• Will this affect your decision to proceed and the investment amount?

Final advice for all investors

Norman recalls the advice given to him by Keiretsu Forum founder Randy Williams when he joined Keiretsu Forum.

• Don’t invest in your first year – use it to learn;
• Attend as many sessions and deep dives as you can;
• Do at least 1, preferably 2 due diligence projects;
• Seek insights from more experienced people in Keiretsu;

At the end of the day, what matters to Norman is the big picture, does the company have a real possibility of becoming successful? What are the obstacles and how do they get around them? Does the company have a clear vision of what it wants to achieve? As a longtime financial advisor, Norman explained that you can only invest in what you can afford to lose. As an investor, you need to be careful and ask the right questions every step of the way.

ABOUT THE SPEAKER

Norman Boone is an experienced leader and entrepreneur. He founded and successfully sold two companies - one a financial advisory firm and the other a software SaaS firm. He is a board member of many non-profit organizations, a university, and professional associations. He also authored a textbook for the financial services industry and a variety of articles and columns. He is currently retired and is focused on consumer fairness, scaling of successful non-profits, and consulting to non–profits, and is an active angel investor. Click here to watch his keynote address.  

Keiretsu Forum saw a 21% investment increase in 2021 as its members continued to power seed, late-stage, and early-stage companies.

SEATTLE, WA, May 10, 2022 – The Keiretsu Forum Northwest and Rockies regions within the world’s largest angel investing community, has announced its 2021 funding data. Angel investors in the Northwest & Rockies have invested more than $60 million in 93 companies across multiple sectors, surpassing all investment forecasts and making 2021 the most invested year to date.

“Keiretsu Forum continues its vibrant growth across our regions. Investors and entrepreneurs are benefiting from our unique footprint, disciplined process for originating quality deal flow, and success syndicating early and late-stage investment opportunities,” said Brianna McDonald, Keiretsu Forum Regional President.

According to Pitchbook's 2021 global annual figures, Keiretsu Forum in the U.S. invested in 167 companies, and the global network invested in 246 companies, bringing the total to over 380 fundings in the past year. In a year of economic and social uncertainty, angel investors have funded entrepreneurs and start-ups in one of the most challenging business environments in recent history.

“We continue to welcome expanded partnerships to benefit the Keiretsu Forum Network community. Despite the global disruptions, we are likely to see continued growth across all sectors in 2022,” continued McDonald. Keiretsu Forum has also expanded its international presence and is now represented in 24 countries across 4 continents.

2021 has been an incredible year for the Keiretsu Forum global network, with investments up 21% since 2020, and Life Sciences/MedTech, Fintech, and Technology attracting the most funding.

In 2021, Keiretsu Forum has backed the following companies and many more:

• AI Optics
• DigitSec
• E2C Technology
• Epilogue Systems
• Healionics
• Inmedix
• Joule Case
• Key Co Travel
• KitoTech Medical
• Light Line Medical
• LumiThera
• Lumoptik
• Orion Biotechnology
• Oticara
• Seneca Therapeutics
• Soteria Battery
• Steelhead Composites
• Summit Venture Studio
• Vartega
• VKTRY

About Keiretsu Forum Northwest & Rockies

Keiretsu Forum Northwest & Rockies is the Pacific Northwest portion of Keiretsu Forum. It includes chapters in Vancouver (Canada), Denver/Boulder, Bellevue, Seattle, Salt Lake City/Boise, and Portland. Keiretsu Forum Northwest & Rockies has more than 400 members and has invested over $500 million in over 775 companies since its founding in 2005.

For more information visit www.k4northwest.com

About Keiretsu Forum

Keiretsu Forum is a global investment community of accredited private equity angel investors, venture capitalists, and corporate/institutional investors. Keiretsu Forum was founded in 2000 by Randy Williams. Keiretsu Forum today is a worldwide network of capital, resources, and deal flow with 50+ chapters on four continents. Keiretsu Forum members invest in high-quality, diverse investment opportunities. To date, it has invested in over 2,000+ companies. The community is strengthened through its involvement in social and charitable activities.

For more information visit www.keiretsuforum.com

Keiretsu Forum Global Investor Network Ranked #1 Angel Investor, U.S. Region, by The Angel Resource Institute 2020 HALO Report based on the number of deals - lauds Keiretsu Forum’s leadership presence for both entrepreneurs and investors in key, localized markets.

Keiretsu Forum is known by investors and entrepreneurs alike for its proven approach for originating quality deal flow and success in syndicating early and late-stage investment opportunities around the world.  According to the report, “This year Keiretsu Forum’s participation put them in the top position nationwide for a number of deals in 2020. They also have many chapters across the country – with direct leadership in each region.” 2020 was a banner year for Keiretsu Forum, with the organization achieving a record 300 + fundings (including follow-on fundings) into seed, early-stage, and late-stage companies in 2020. Deal activity increased approximately 16% compared to 2019. Keiretsu Forum deal flow and fundings continue to be diverse and across all technology sectors, prop-tech and Real Estate. Life Science, Medical Devices, Environmentally Sensitive/Aware; and solution-driven Technologies attracted a significant amount of capital.

Keiretsu Capital, the exclusive worldwide fund partner of Keiretsu Forum, continues to be a top-tier funder of late-stage investment deals in the network. The 2020 Halo Report is based on an analysis of 2,198 transactions completed in 2020. The focus of the report primarily focused on Seed and Series A companies. These transactions represented a total of  $4.617B invested, of which $2.84B is clearly Seed or Pre-Seed, and $1.024B is Series A, A1, or a convertible note leading to a Series A. In addition to industry growth in general, the 2020 HALO report pointed to the increasing spread of investors across the US, and the need for angel groups to accommodate investors in those areas. Keiretsu Forum, which has recently launched a number of regional and localized chapters in emerging markets, now boasts 50+ chapters on four continents.

About The Angel Resource Institute (ARI)

Founded in 2005, The Angel Resource Institute (ARI) is a charitable organization devoted to increasing the effectiveness and availability of financial and mentor capital to entrepreneurs. The organization provides education, training, and information on best practices related to the earliest stages of angel investing and new venture development. Through its core competencies of research, data collection and analysis, ARI develops educational workshops, white papers, and toolkits for angel investors, entrepreneurs, and the entire startup community. The founders of the Angel Resource Institute include leading angel investors and entrepreneurs in collaboration with the Ewing Marion Kauffman Foundation.

About Keiretsu Forum

Keiretsu Forum is a global investment community of accredited private equity angel investors, venture capitalists, and corporate/institutional investors. Keiretsu Forum was founded in 2000 by Randy Williams. Keiretsu Forum today is a worldwide network of capital, resources, and deal flow with 50+ chapters on four continents. Keiretsu Forum members invest in high-quality, diverse investment opportunities. To date, it has invested over $900 million in 2000+ companies. The community is strengthened through its involvement in social and charitable activities.

BALTIMORE, July 21, 2021-- b.well Connected Health, the digital transformation platform providing consumers a new front end to health care, today announced it has secured $32 million in an over-subscribed Series B financing round.

Screenshots of the three most popular features of b.well: Search, Health Circle and My Health.

The funding will be used to increase market penetration and advance product innovations that help customers achieve their digital transformation goals and expand visibility into the populations they manage. The funding round follows a strong year of growth in 2020-21, which saw the business increase by 2x as more organizations implemented the b.well platform to connect with their patients, employees and communities.

The capital raise was led by HLM Venture Partners (HLM), and Steven Tolle, General Partner at HLM, has joined b.well's board of directors. Existing investors ThedaCare, UnityPoint Health Ventures, and Well Ventures–a subsidiary of Walgreens Boots Alliance, Inc.–also joined the round.

"Our digital transformation platform is helping healthcare organizations and self-insured employers deliver an unparalleled and personalized health care journey for their patients, members and employees," said Kristen Valdes, CEO and Founder of b.well. "Consumers have grown accustomed to technology that makes banking, travel and shopping simpler and more convenient. Now more than ever they're demanding the same convenience when it comes to managing their health and that of their loved ones. We thank our investors for their strong support of our vision for creating simple, connected, and personalized health care journeys."

b.well's customers use the company's digital transformation platform to provide their patients, health plan members, and employees with the most informed and simple pathway to access care and improve their health. That in turn helps organizations to manage their population health initiatives including Medicare Advantage risk-based contracts, Direct Contracting, and Accountable Care Organizations. To drive better outcomes, customers can deploy incentive programs through the b.well app without the need for costly care management programs. 

End users access b.well on their phone or PC to gain access to all of their health data from virtually any source—providers, insurers, labs, pharmacies, wearables, devices and apps—and to receive truly personalized, proactive health guidance, as well as navigation to care in-person or virtually.

"In the wake of the pandemic and the rise of virtual health, every health system in the country should rethink how they engage with their community and patients, especially in competitive markets," said Tolle. "HLM looks for investments like b.well that have proven early stage adoption and strong leadership. They have already achieved significant scale with adoption by several name-brand health systems as well as large self-insured employers, plus the company is led by an impressive team of industry veterans, and is poised for substantial growth in the coming year."

About b.well Connected Health
b.well Connected Health is a healthcare technology company providing platform services comprised of five core capabilities that work together to enable health systems, payers, and employers with a configurable and personalized digital health experience for their populations. The b.well technology platform is transforming how consumers interact with the healthcare system by integrating data, insights, and partners into a single customized solution that helps people take control of their healthcare experience. Visit www.icanbwell.com for more information.   

Company expands manufacturing of HaptX Gloves DK2 to meet strong customer demand

REDMOND, WA,  – HaptX, the leading provider of realistic haptic technology, today announced a Series A-1 financing round of $12 million along with new headquarters in the Seattle area. HaptX also announced a second manufacturing run of HaptX Gloves DK2, the world’s most advanced haptic feedback gloves, after selling out the first run in less than six months.

“The COVID-19 pandemic accelerated enterprise adoption of virtual reality and telerobotics. Companies are increasingly recognizing the value of true-contact haptics for training, design, and robotics applications,” said Jake Rubin, Founder and CEO of HaptX. “With fresh capital and a new state-of-the-art headquarters, we’re well positioned to scale our workforce to meet this growing demand.”

HaptX’s $12 million in growth financing brings the company’s total funding to $31 million. The round includes participation from existing investors Verizon Ventures, Mason Avenue Investments, Taylor Frigon Capital Partners, and Upheaval Investments.

“HaptX’s advanced technologies make virtual reality a more fully immersive and realistic experience while addressing real-world enterprise needs,” said Michelle McCarthy, a Managing Director of Verizon Ventures. “Verizon’s 5G and MEC are instrumental in enabling wireless VR for multiple applications – especially in a quickly evolving workforce. We look forward to supporting the team’s vision and technology.”

The company’s new Redmond, WA headquarters features 15,000 square feet of office and warehouse space. HaptX has also expanded its San Luis Obispo office footprint by 50%. Over the next 12 months, HaptX will add dozens of new positions across all areas of the company.

“We can’t wait to bring HaptX customers to the hardware showroom in our new headquarters,” said Joe Michaels, Chief Revenue Officer of HaptX. “Customers will soon be able to experience current and next-generation HaptX products and meet the talented people who make them.

HaptX has open positions available in mechanical engineering, software development, sales, and operations across its Seattle and San Luis Obispo offices. Learn more about HaptX Gloves DK2 and career opportunities with HaptX at haptx.com.

About HaptX 

HaptX builds technology that simulates touch sensation with unprecedented realism. HaptX Gloves enable natural interaction and true-contact haptics in virtual reality and robotics for the first time. A venture-backed startup, HaptX is headquartered in Redmond, WA, with offices in San Luis Obispo and San Francisco, CA. Visit us at www.haptx.com

Read The Article: https://haptx.com/growth-funding-redmond-hq/

Starting a business can be a tumultuous experience for an entrepreneur. Every entrepreneur wants to build a business that will attract funding, scale their operations and make profits. Likewise, investors are looking for companies that promise attractive returns on their investments. So, what connects entrepreneurs and investors? Both are looking for a recipe for a start-up’s success. Is there a recipe for success? If not, what are the factors that can accurately predict a successful future for a start-up? Is it the business model? The idea? The team? Kevin Turner tells you how!

He is a long-time angel investor and Keiretsu Forum member who recently delivered a keynote speech at the Keiretsu Forum Northwest & Rockies April Roadshow. Under the theme, "Due Diligence – to write a check", he explained what investors are looking for in a company and what factors give them the confidence to invest.

So, what are the factors that make a start-up a success?

The answer to this question goes back to a 2015 Ted Talk. In a study, American businessman and Idea Lab founder Bill Gross identified the most important factors for a start-up’s success.

How do you predict which start-ups will be successful? Does funding rank as the most important factor? Or does the business model win? Bill Gross gave his prediction in order of importance:

• Timing (42%)
• Team/Execution (32%)
• Idea (28%)
• Business Model (24%)
• Funding (14%)

Timing

We all know that being in the right place at the right time is critical. When new technologies become part of the innovation landscape, their success depends on how well they help ensure that these technologies are understood by a wider audience.

Example: The apple pilot debuted in the 1990s. it was the first personal digital assistant to be produced. It was a failure, and Apple had to abandon it, not because it was a bad product, but because it was ahead of its time. In the future, the iPod and all other Apple products follow Apple's pilot. This shows that timing plays the most important role in the success of a product.
 

Team/Execution

A good team that can thoroughly implement the idea is the second most important factor. Every business needs a quality team and a good execution plan, otherwise, the business will not move forward. Some people only invest based on the team, especially if they have a track record of entrepreneurial success and multiple successful exits. A good team includes not only a group of highly qualified professionals but also their ability to respect each other's opinions and collaborate effectively to implement ideas and push the company vision forward.
 

Idea

A good idea is the third most important factor after timing and a good team. According to Bill Gross, the success rate of the idea is 28%. If you have a great idea, you can get the team, you can get funding, and you can get a lot of recognition in the market - but a great idea by itself doesn't give you huge success.
 

Business Model

A good business model is a very important strategic tool for entrepreneurship. It's not enough to have a good idea - even a good business idea can be useless if it cannot be developed, executed, and implemented. A good business model not only helps you focus on the steps needed to make your idea successful but also helps you achieve your short- and long-term goals.
 

Funding

To Kevin's surprise, funding was considered the least important factor out of the five for a start-up's success. He explained that while start-ups need funding, they don’t need it initially. A start-up needs to organize launch times, business strategy, ideas, and teams into a cohesive model that ultimately drives funding. As an entrepreneur, you might have a great product at the right time, run by a great team, and your chances of getting good funding might be high, and that's what it's all about!

Kevin follows the KISS (Keep it Simple Stupid) approach to investing
and these are his 4 predictors for a start-up’s success

Kevin’s mantra to finding the perfect company to invest in, with examples! 

 Kevin shared his experience as a member of multiple due diligence teams and the core of the investment philosophy that led him to invest in multiple companies. His investment philosophy? Invest in companies that have a positive impact on humanity. Kevin has always been passionate about investing in companies that work to create positive change in the real world, and now he has decided to go a step further and invest in companies and services that can do just that! Here are some examples of companies he invested in and what aspects of the companies led him to ultimately decide to invest.

Oisin Biotechnologies – Gene Therapy Startup

Oisin Biotechnologies wanted to be the FedEx of gene therapy. It wasn't until he became part of the due diligence team that he began to appreciate the simplicity of gene therapy. The company had a highly skilled and experienced team who together developed an elegant solution.  They have yet to identify any bottlenecks for the future of gene therapy, and based on their progress so far, Kevin thinks the future of medicine is very bright.

Oscilla Power – Wave Energy Start-up

Oscilla Power was focused on being the lowest-cost provider. They achieved this by creating an IP focused on the design of floats and reaction vehicles. They used off-the-shelf electronics to make the product as cheap as possible, saving on installation and maintenance costs compared to their competitors who used more expensive electronics. Kevin said he knew all of this because he was part of the due diligence team.

Pattern Computer – Explainable Artificial Intelligence

Kevin was introduced to Pattern Computer through a member of the due diligence team. It took him several months to understand the quality of the team and the people in the company. Since then, his initial investment in the company has seen a 20x return, and he attributes his investment decision to the time he spent on due diligence.

Kevin’s advice for investors  

Over the next decade, we will see tremendous advances in knowledge and technology as growth in both fields accelerates.  Kevin pointed out that it is currently difficult for investors to learn and keep up with technology within their area of expertise, let alone outside of it. He noted that if investors can overcome this hurdle, they can become excellent integrators, bringing together the latest technologies. He believes that every investor should develop an investment philosophy, and save money for investments. As an investor, you can choose the best start-up based on an idea you think will be successful, then join a due diligence team that will help you make key decisions and eventually write that check.

ABOUT THE SPEAKER

Dr. Kevin Turner has accumulated more than three decades of experience and expertise in the practice and business of medicine. An awarded and Board Certified, Obstetrician/Gynaecologist, Dr. Turner is an expert in navigating complex regulatory frameworks and compliance. His wide breadth of experience and expertise include the following: business management; robotics, human resources; public health; software development and integration; curriculum development; strategic planning; product development and manufacturing; and marketing. With a background in macroeconomics and technology, Dr. Turner has carefully monitored the rise of cryptocurrencies, blockchain, and artificial intelligence (AI). He is an accepted thought leader in the convergence of these technologies. Click here to watch his keynote address.  

SEATTLE, May 13, 2021 -- Healionics Corporation, a private medical device company, announced today the completion of a $4.7M equity financing round led by Keiretsu Capital. The company also announced the conversion to equity of $5.2M in previously outstanding notes and interest.

Healionics is preparing to commercialize its innovative STARgraft vascular graft, designed to provide a safer and more reliable means to access the bloodstream for dialysis in patients with kidney failure.  An initial human study was completed last year, and a follow-on human study is now in progress.  The financing will be used to complete this study and obtain FDA market clearance.

"We appreciate the strong support in this round by existing shareholders and welcome the participation by several new angel and venture investor groups," said Mike Connolly, Chief Executive Officer of Healionics.  "We are targeting early next year for commercial launch of STARgraft.  This novel synthetic blood vessel, based on our proprietary STAR biomaterial technology, has the potential to improve the lives of dialysis patients by reducing the frequency & severity of infections and the frequency of interventions required to maintain dialysis access."

About Vascular Grafts
More than 500,000 people in the United States suffer from kidney failure and require frequent dialysis to filter waste from their blood.  Current methods of creating and maintaining regular bloodstream access for dialysis are unreliable and account for a significant portion of the $50 billion spent each year on U.S. kidney-failure patients.  A vascular graft (synthetic blood vessel) is often implanted to create an access site with a sufficient flow rate for dialysis, but conventional grafts can develop life-threatening infections and frequently develop blockages that require expensive interventions.

About Healionics Corporation
Healionics is a clinical-stage company addressing the critical need for safer, more reliable means to access the bloodstream for dialysis in patients with kidney failure.  Its STARgraft vascular graft is designed to resist the problems of infection and occlusion suffered by current devices.  The company also has an exciting product pipeline based on its platform STAR® biomaterial, which has a unique ability to resist both infection and scarring, two problems that affect all implanted devices.  www.healionics.com

SOURCE Healionics Corporation

Sparrow Pharmaceuticals confirmed it closed a $50 million financing round, one of the state's largest such rounds of the year. The firm had not formally announced the round when the Business Journal uncovered it when tracking 2021's hefty first quarter of fundraising.

It also revealed it hired Robert Jacks as the company’s new CEO.

Sparrow is developing novel, targeted therapies for disorders caused by excess corticosteroids, which can be produced by the body or administered in medicine for autoimmune or inflammatory disease.

About 2 million patients in the U.S. are on corticosteroids, such as prednisone, which come with serious side effects, including fractures, diabetes, stroke and glaucoma, David Katz, Sparrow’s founder and CEO, has said. The company’s drug candidate could potentially separate the efficacy of steroid medications from those severe side effects, Jacks said.

The company will use the financing to speed the development of its drug candidate, which targets the source of steroids that cause toxicity in key tissues. Sparrow anticipates starting Phase 2 trials in patients with a form of Cushing syndrome in the next 12 months.

OrbiMed led the investment round with participation by RiverVest Venture Partners and U.S. Venture Partners.

Katz lives in Portland and serves as chief scientific officer. Jacks, who lives in Connecticut, comes to Sparrow after 20 years in the pharmaceutical industry, including corporate and business development work for Pfizer.

In 2019, Sparrow won the Oregon Bioscience Association’s Pitch Fest.

Credit: https://www.bizjournals.com/portland/news/2021/05/18/portland-biotech-startup-raises-50m-hires-new-ceo.html

If you're thinking about going the angel route, here are five critical things to know about the process that can lead to a successful round.

For startups, a great alternative to venture capital is angel funding. A silver lining that has rapidly emerged over the past year is the uptick of virtual angel investment groups. 

At Keiretsu Forum we have pivoted online, a notable trend amid large angel investment groups, which means existing investors, no matter their location, can access and evaluate any of the deals that go through the network. Concurrently, new investors seeking to diversify their portfolios are gravitating to the virtual angel model. Member onboarding, due diligence, live presentations, and member meetings are now all conducted online.

If you’re thinking about going the angel route, here are five critical things to know about the process that can help lead to a successful round:

1. Prepare for virtual fundraising

In a post-Covid-19 pandemic, world capital must be raised virtually. The biggest challenge for entrepreneurs is that investments are made without ever meeting potential investors face-to-face. There is minimal eye contact and little body language—which is the language of funding—in a Zoom meeting. The goal is selling the upside potential and creating interest.

Try and get into the mind of the angel, who will be evaluating you and asking themselves:

• Who are you?
• Why would I want to be involved and work with you?
• Do I support the journey, the mission, and the impact?
• Is the technology compelling?
• How vast is the market opportunity?

All those questions must be addressed during the pitch presentation.

Fundraising as an ongoing process, with presentation and speaking skills evolving over the course of the campaign. Constantly evaluate your own presentation: Is the audience-market quickly defined? What is the pitch about? Why is it being pitched? Who will benefit from it?

Indeed, the most effective technique for improving your pitch skills is to watch entrepreneurs with similar stage companies deliver pitches. Presenting to 50, 60, or hundreds of investors is no small task. Before and during the process, put your ego aside, and attend a few online investor forums to see how the best do it.

A good pitch coach is someone who can simplify the process and make it less daunting. In addition to the pitch itself, not to be underestimated is honing the presentation skills that enable the entrepreneur to deliver an engaging and compelling presentation.

2. Angels like familiarity

Angels gravitate toward opportunities in the industries they have direct experience in, and the insights they can share with founders on how to successfully grow companies within those markets is invaluable.

Relationships between entrepreneurs and angels can get started quickly and can be very hands-on, with angels oftentimes embedded within the company’s extended management and advisory network. In scenarios like this, the expertise, plans, and funding take place within an exciting and collaborative environment.

“People invest in people they know, like and trust. Once an entrepreneur goes through the process of securing angel funding, they are part of a tight community.”

People invest in people they know, like, and trust. Once an entrepreneur goes through the process of securing angel funding, they are part of a tight community. By example, approximately half the entrepreneurs that present to Keiretsu Forum are members of the group. Many are angels and entrepreneurs that have built and sold several companies.

The companies that make it through the full process are typically ones who raise capital, have a track record of success, understand the fundraising process and the value of seed funding. This environment helps to cultivate relationships between the investors and the entrepreneurs.

3. Due diligence is the force multiplier

Due diligence is the key to a successful funding round. The process can be lengthy, taking upwards of 80 to 100 hours over six to eight weeks, but once completed the company is now able to syndicate and receive further capital.

Typically, in an angel group setting, companies initially pitch first to a deal screening committee who determines if the opportunity is worthy of a full investor presentation. If there is interest, the due diligence process begins. Keiretsu Forum deploys on average 50 to 60 members that evaluate the opportunities and vote on inviting opportunities forward to the next step. Tight screening should be a confidence builder for both angel and entrepreneur.

For example, Keiretsu Forum members back more than 80% of the companies that go through the process. An affiliated fund, Keiretsu Capital, will often invest alongside the members backing the company. This process gets repeated when the deal is syndicated across the network that includes numerous additional angel groups. At the end of the cycle, there should be 50-70 interested angels to close capital from.

4. Protect intellectual property

Most angel investment groups will not sign NDAs to conduct due diligence. It is critical to have a proper patent strategy to protect key intellectual property (IP). That said, due diligence plays a large hand in formulating that strategy, ensuring there is a good framework in place for the company to document a sustainable differentiation, with the freedom to operate and prevent competition from infringing on their patents.

Most angel groups have IP attorneys who are members and conduct those reviews. Be careful about what you put in writing—angels should be able to understand what is going on with your business without you disclosing important assets.

5. Family offices deliver patient backing

The alignment between family offices and angel groups is the future of entrepreneurial finance. Indeed, family offices are experiencing a huge transfer of wealth (approximately $20 trillion) to the next generation of family members who are eager to make impact and diversity investments. Consider that more than one-half of the companies funded through Keiretsu Capital are now also funded by family offices.

Moreover, unlike VCs, family offices are geared toward investing over a longer horizon and do not have an incentive to overly dilute the companies they invest in. Most important, family office investment adds a substantial balance sheet for fueling growth, and a sense of financial confidence for anticipated tough stretches.

The symbiotic relationship between the angel investors that have the entrepreneurial expertise and the family offices that have the wealth that should most excite female entrepreneurs seeking to raise capital.

Brianna McDonald is president of Keiretsu Forum Northwest, the largest chapter of Keiretsu Forum, the world’s biggest angel investor network ranked by Pitchbook #1 “Most active investors early stage US region” and “Most active investors late-stage US region.” Brianna is adept at screening companies for angel investment, coaching companies on presentation and investor relations, sales strategy execution, relationship management, and leading due diligence teams. Brianna believes in companies that have “multiple bottom lines”, in that they are not solely focused on profits but also focused on impact, social good, diversity, and making the world a better place for the next generation. 

SEATTLE, Oct. 1, 2020 /PRNewswire/ -- OtoNexus Medical Technologies Inc. announced today that MedTech Outlook selected them as one of 10 companies nationwide that are at the forefront of providing infection control solutions and having an impact on the industry.

OtoNexus has developed the world's first ultrasound hand-held device to evaluate the four disease states of middle ear infection.  With the tools available today, detection accuracy is approximately 50% in the critical differentiation of viral versus bacterial infections.  As a result, middle ear infections are the #1 reason for antibiotic prescriptions and #1 reason for surgery in children.  

The Center for Disease Control suggests prescribing antibiotics for about 15% of middle ear infections. However, antibiotics are prescribed nearly 85% of the time. "Our goal is to decrease the usage of antibiotic therapy by 50% for the treatment of middle ear infections," said Caitlin Cameron, CEO OtoNexus Medical Technologies. It is an honor that MedTech Outlook recognizes how our unique technology empowers physicians to avoid unnecessary prescriptions of antibiotics and improve treatment of middle ear infections."

The OtoNexus device has the potential to:

• Minimize the use of unnecessary antibiotics in the treatment of middle ear infections
• Improve patient outcomes with timely, accurate diagnosis and treatment
• Reduce the cost of care by decreasing the number of follow up visits due to adverse antibiotics side effects and referrals to specialists

"We have been quite impressed by OtoNexus Medical Technologies' expertise in providing infection control solutions," said Alex D' Souza, Managing Editor of MedTech Outlook magazine." We congratulate OtoNexus Medical Technologies on this prestigious recognition and look forward to seeing their impressive growth streak continue."    

About OtoNexus Medical Technologies Inc.

OtoNexus has developed the world's first hand-held medical device with miniaturized ultrasound technology to instantly and accurately diagnose middle ear infections. In less than 2 seconds, physicians can evaluate middle ear infections and know whether antibiotic therapy is appropriate. This definitive test will provide physicians the information they need to minimize the use of antibiotics, improve patient outcomes, and reduce the cost of care.  For more information, please visit www.otonexus.com

About MedTech Outlook

MedTech Outlook is a platform that bridges the spectrum between MedTech Technology providers and healthcare facilities and medical institutions.  MedTech Outlook monitors and informs about MedTech trends, challenges, and solutions.  MedTech Outlook assists purchasers/procurers, decision-makers, and heads of operations, healthcare managers from peer vetted authoritative contributions.

About Keiretsu Forum

Keiretsu Forum, the world’s leading angel investor network with over 1,500 investors in 38 chapters on 3 continents. Keiretsu Forum has invested more than $500 million into more than 700 companies since inception. Keiretsu Capital administers funds on behalf of its Limited Partners - the Co-Investment & Opportunities Fund creates a diversified portfolio of technology start-ups backed by top tier angel groups and pursues the high upside value potential in these dynamic investment opportunities while promoting the sharing of risk inherent in any early-stage venture.  The firm is based in Seattle and San Francisco and its principals are veteran Silicon Valley and technology investors Randy Williams, Matthew C. Le Merle, and Nathan McDonald. 

For more information please visit www.keiretsuforum.com or contact us.

Sep 29, 2020, 10:31am, Forbes

Today, HaptX, Virginia Tech, and the University of Florida won a $1.5 million National Science Foundation (NSF) grant to develop the first program to bring force feedback to upper and lower limbs in virtual environments, ForceBot. Founded in 2012 by Jake Rubin and Dr. Robert Crockett, HaptX started with a vision they strikingly captured in an image of the full body haptic system Rubin envisioned for virtual reality (VR). The company has taken a serious detour through reality, productizing haptic gloves for VR and robotic telepresence. After turning practical, and doing another round of funding based on its growing enterprise business, they are going back to the future with this announcement.

ForceBot is a four-year project to develop an exoskeleton for commercial and enterprise applications using HaptX’s microfluidic touch feedback technology to simulate virtual objects. The NSF grant will be distributed between each company to contribute individual components to ForceBot, and then the resulting IP will be used for commercial products. In the project, VR and robotics are hand in hand towards building a full-body haptic exoskeleton rig. The rig will increase force feedback on the human body for users in virtual environments. HaptX’s contribution to the project is finding the commercial uses for the rigs, in addition to the use of HaptX Gloves products in the rig. Jake Rubin, CEO and Founder of HaptX told us that in the short term they have always, “built towards the company’s original vision piece by piece, performing R&D on each segment of the full system while simultaneously narrowing down what has the most short term commercial potential.” The grant brings things into a full circle, with plans to use the exoskeleton to create prototypes of a product for the future.

This exoskeleton will be designed to mimic real-world forces such as weight, texture of objects, shape, and terrain. Dr. Alexander Leonessa, Principal Investigator, Virginia Tech stated, “we’re excited to create a system that increases immersion for VR users in applications requiring intensive body motions like sports and industrial skills training, gaming, emergency response, and many others.” 

How we interact with the virtual worlds we occupy is one of the central questions of VR. This thought regarding HaptX was included in my first book, Charlie Fink’s Metaverse. With the HaptX full exoskeleton, the rig will be able to use mechanical arms with gloves [as seen at CES 2020] and actuators attached to each leg will simulate the haptic feedback from walking, running, and climbing stairs. The company is trying to establish itself as more than a glove company. Regardless of the success of the ForceBot, the worst-case scenario is still a product that fulfills the company’s original vision in some capacity. Rubin left us with this statement, “immersion and fidelity are wanted in the market and HaptX is not going to stop until we get there.” 

This story was written with Brandon Cloobeck.

About Keiretsu Forum

Keiretsu Forum, the world’s leading angel investor network with over 1,500 investors in 38 chapters on 3 continents. Keiretsu Forum has invested more than $500 million into more than 700 companies since inception. Keiretsu Capital administers funds on behalf of its Limited Partners - the Co-Investment & Opportunities Fund creates a diversified portfolio of technology start-ups backed by top tier angel groups and pursues the high upside value potential in these dynamic investment opportunities while promoting the sharing of risk inherent in any early-stage venture.  The firm is based in Seattle and San Francisco and its principals are veteran Silicon Valley and technology investors Randy Williams, Matthew C. Le Merle, and Nathan McDonald. 

For more information please visit www.keiretsuforum.com or contact us.

Aclipse Therapeutics is pleased to announce that one of the world’s largest biomedical research funding agencies has awarded Aclipse a $2.1 million grant to support the development of Aclipse’s M102 for the treatment of ALS. The grant is non-dilutive and will fund the completion of IND-enabling studies and will allow Aclipse to initiate the first-in-human studies for M102. The grant will also further fund the development of therapeutic biomarkers for M102’s efficacy and patient stratification. The grant award was the result of a highly competitive application and peer-review scientific process. 

This most recent grant makes a total of over $2.8 million non-dilutive funds awarded to the M102 program in the last month and further validates M102’s biological approach and potential to become a targeted and life-saving therapeutics for ALS patients. 

Raymond K. Houck, CEO of Aclipse Therapeutics, said: “We are honored by the support from FightMND which shares our vision for a novel and broad multi-disease pathomechanism approach to treating ALS patients.

 “The FightMND award also confirms M102’s success to date and validates M102’s potential to become a targeted and life-saving therapeutic for ALS patients.”

The research forms part of the work of the University of Sheffield’s Neuroscience Institute, which aims to bring academics and scientists together from across varied specialties to translate scientific discoveries from the lab into pioneering treatments that will benefit patients living with neurodegenerative disorders.

The study was supported by the National Institute for Health Research (NIHR) Sheffield Biomedical Research Centre, which is the UK’s only Biomedical Research Centre dedicated to Neurology. It is a research partnership between the University of Sheffield and Sheffield Teaching Hospitals NHS Foundation Trust, dedicated to improving the treatment and care of people living with chronic neurological disorders.

Read the article to know more.

 Keiretsu Capital identified and invested in Aclipse Therapeutics, an innovative biopharmaceutical company that focuses on developing novel and highly differentiated drugs to address diseases with high unmet medical needs. We are confident in this company and team; they continue to meet their milestones and deliver on targets.” said Nathan McDonald, Managing Partner and CEO of Keiretsu Capital.  

About Keiretsu Forum

Keiretsu Forum, the world’s leading angel investor network with over 1,500 investors in 38 chapters on 3 continents. Keiretsu Forum has invested more than $500 million into more than 700 companies since inception. Keiretsu Capital administers funds on behalf of its Limited Partners - the Co-Investment & Opportunities Fund creates a diversified portfolio of technology start-ups backed by top tier angel groups and pursues the high upside value potential in these dynamic investment opportunities while promoting the sharing of risk inherent in any early-stage venture.  The firm is based in Seattle and San Francisco and its principals are veteran Silicon Valley and technology investors Randy Williams, Matthew C. Le Merle, and Nathan McDonald. 

For more information please visit www.keiretsuforum.com or contact us.

About  Aclipse Therapeutics 

• Aclipse has an experienced management team that exited Thar Pharmaceuticals, where we developed a phase 3 orphan drug that was acquired by Grünenthal.
• They have an ALS clinical advisory board of 5 of the top 10 ALS physicians in the world.
• Their first product M102 is a disease-modifying, new chemical entity drug candidate for Amyotrophic Lateral Sclerosis (ALS, Lou Gehrig’s disease) with a significant upside to also treat in Huntington's disease, Friedreich’s ataxia, and Parkinson's disease.
• M102 activates the Nrf2 and HSF1 pathways and, in animal models, not only stops ALS disease progression, but reverses the animals back toward the healthy state.
• They can identify those ALS patients who respond to M102 vs. those patients who do not respond. This ability to precisely target specific patients increases our probability of clinical success by 3.1-fold according to industry data
• The US spends $6 billion per year on treating ALS patients. M102 is projected to generate $2.3 billion/year in peak sales.

Learn more - https://www.aclipsetherapeutics.com/

By Tony Lystra  – Tech Editor, Puget Sound Business Journal

Aug 27, 2020, 11:57am EDT

Earlier this year, Joule Case, the Seattle portable battery manufacturer, thought it had found a stable, reliable market in music festivals. 

Last year, the company powered nearly a half-dozen music events, including the Treefort Music Fest in Boise and the Nocturnal Wonderland rave festival, which hosts events in Southern California and Texas.

Historically, the festivals have relied on diesel generators, coughing out plenty of carbon emissions as they power lights, video displays, soundboards, amps, and monitors.

Joule Case has a solution for that: modular, stackable, and scalable battery configurations that supply all the power diesel generators produce and then some without the greenhouse gases. 

Until the pandemic hit, the music festival season had been scheduled to begin in March, and Joule Case was lined up to power more than 100 of them.

“If you were to tell me in January that there would be an international pandemic and all the customers and all the music festivals lined up would be zero — a big giant goose egg for music festivals — I would have said, ‘Well, Joule Case is not around anymore,’” said James Wagoner, the company’s co-founder, and CEO. 

Rather than quitting, Wagoner and his partner, Alex Livingston pivoted the company toward new markets. Since Joule Case’s beginning in 2015, the partners had been discussing what they see as their batteries’ potentially endless uses.

“The vision of Joule Case is to be, as we call it, the Standard Oil of the green revolution,” Wagoner said. 

That means the batteries can be used to store solar power, provide backup energy to homes in case the grid goes down, and for camping trips, food trucks, medical devices, and building contractors.

“We had some of these conversations back in the day. We had to restart those conversations,” Wagoner said. “It’s just finding those different sales channels and resellers, telling a different story.”

Since the Covid-19 pandemic gripped the U.S. economy, Joule’s investors have been channeling sales opportunities from those new markets to the company, which, Wagoner said, has had to do hardly any cold sales or marketing during the pandemic.

Last week, Joule closed an oversubscribed, second-round convertible note offering, raising $500,000. In all, Wagoner said, the company has raised $1.5 million, largely from angel investors, including Park City Angels and Keiretsu Forum, the international community of private equity angel investors, venture capitalists, and corporate and institutional investors.

Had COVID not killed this year’s music festival season, “Joule Case would have been a much larger company than it is right now,” Wagoner said. Joule had to lay off four music industry specialists because of the pandemic. 

Thanks to those new sales channels, he said, Joule now employs five people and is hiring to fill another two positions.

Since last year, the company has sold more than 200,000 batteries, which are assembled in the Boise, Idaho, suburb of Garden City. A single food truck spent $20,000 on Joule batteries to replace its diesel generator, Wagoner said.

The batteries, he said, come in various sizes and configurations and can be assembled like Lego blocks to suit a customer’s power needs. Costs typically range from $700 to $80,000. A single $700 Joule battery can power a TV for eight hours.

The company is currently talking with electric vehicle manufacturers about using the batteries in cars and trucks. In fact, Wagoner and Livingston’s previous company, R2EV, built batteries for use in electric vehicles.

Among the markets that have emerged from the Covid outbreak are video conference funerals, where portable power is needed to power cameras and TV monitors.

One hospital in California is using a Joule battery to power a portable video conferencing system that can be wheeled into quarantined patients’ rooms so they can talk with their family members.

And then, Wagoner said, there are coders and executives from Google and other Silicon Valley tech companies, who are working from home and facing an unstable California power grid.

“We are seeing significant demand for our power,” Wagoner said. “It’s sometimes good to not know what the future is so you’re not overwhelmed by it.”

About Keiretsu Forum

Keiretsu Forum, the world’s leading angel investor network with over 1,500 investors in 38 chapters on 3 continents. Keiretsu Forum has invested more than $500 million into more than 700 companies since inception. Keiretsu Capital administers funds on behalf of its Limited Partners - the Co-Investment & Opportunities Fund creates a diversified portfolio of technology start-ups backed by top tier angel groups and pursues the high upside value potential in these dynamic investment opportunities while promoting the sharing of risk inherent in any early-stage venture.  The firm is based in Seattle and San Francisco and its principals are veteran Silicon Valley and technology investors Randy Williams, Matthew C. Le Merle, and Nathan McDonald. 

For more information please visit www.keiretsuforum.com or  contact us.

About Joule Case

Joule Case is the only power solution that works for consumers and commercial, industrial, and special event applications.

Know more - https://joulecase.com/

SEATTLE, Sept. 3, 2020 - PRNewswire

 LumiThera Inc., a commercial-stage medical device company creating a photobiomodulation (PBM) treatment for ocular disorders and disease, today announced it is a recipient of a small business innovative research (SBIR) phase II grant from the National Institute of Health (NIH) and the division of the National Eye Institute (NEI).

The phase II grant supports a prospective, randomized, multi-center human clinical trial in U.S. subjects diagnosed with Diabetic Retinopathy (DR) and Diabetic Macular Edema (DME). The Photobiomodulation Reduction In Macular Edema (PRIME) trial, which is subject to FDA Investigational Device Exemption (IDE) approval, will test vision and examine disease pathology in the eye following PBM treatments using the Company's Valeda® Light Delivery System. Subjects will be followed for up to 6 months.  In 2018, LumiThera obtained a CE mark to commercialize the Valeda Light Delivery System in Europe for the treatment of dry AMD. 

Diabetic retinopathy is the most common diabetic eye disease and a leading cause of blindness in American adults.  It is caused by damage to the blood vessels of the light-sensitive tissue at the back of the eye (retina). At first, DR may cause no symptoms or only mild vision problems, but eventually, it can lead to blindness. Diabetic retinopathy can develop in anyone who has type 1 or type 2 diabetes. The longer a patient has diabetes and the less controlled their blood sugar is, the more likely they are to develop this eye complication. Sometimes the central part of the retina (macula) begins to swell (macular edema), a condition called DME that requires treatment.

"Diabetic retinopathy is the leading cause of blindness worldwide," commented Quan Dong Nguyen, M.D., M.Sc. and Diana V. Do, M.D., both professors of ophthalmology at the Byers Eye Institute, Stanford University School of Medicine. "We will be evaluating if PBM can provide an early treatment for DR and reduce macular edema. If successful, PBM could delay or reduce the need for intravitreal pharmacotherapy with currently approved Anti-VEGF medications or replace invasive laser surgery."

"The PRIME study expands LumiThera's global efforts to bring forward PBM treatments for debilitating eye diseases that can result in loss of vision," stated David Boyer, M.D., Retina-Vitreous Associates Medical Group, Los Angeles, CA. "The PRIME study in DME patients would create a novel treatment option for DME patients and expand the Valeda use into a 2^nd major therapeutic market."

"The NIH clinical grant is substantial in providing over $1.5M in funding to develop a PBM therapy for diabetic patients in the U.S.," stated Clark Tedford, Ph.D., President and CEO.  "We are pleased to have the NIH/NEI partially support the further development endeavors of LumiThera, and the grant is a significant step in the validation of the PBM technology and its potential in treating chronic eye disease."

"We are very excited to be part of the PRIME multicenter DME pilot trial," remarked Victor Gonzalez, M.D., Valley Retina Institute, McAllen, Texas. "The U.S. centers and investigators participating in this trial are very well experienced in the treatment of DME and this clinical trial will evaluate a variety of vision and imaging outcomes including Ocumet's mitochondrial and Diopsys' electroretinogram (ERG) functional measures with PBM and set the foundation for expanded use of Valeda in Diabetic Retinopathy and Macular Edema."

The Coordinating Center for the PRIME Study will be at the Byers Eye Institute at Stanford.  The Ocular Imaging Research and Reading Center (OIRRC, Sunnyvale, CA) will serve as the Reading Center for the Study.   

About LumiThera Inc.
LumiThera is a commercial-stage medical device company focused on treating people affected by ocular disorders and diseases including dry age-related macular degeneration, a leading cause of blindness in adults over 65. The company is a leader in the use of PBM for the treatment of acute and chronic ocular diseases and disorders. The company is developing the office-based Valeda® Light Delivery System to be used by eye care specialists as medical treatments.

The Valeda Light Delivery System has been granted authorization to use the CE Mark by an EU Notified Body as required for commercial use in the European Union only. Valeda is not approved for use by the Food & Drug Administration (FDA) in the USA.

Visit the Company's website at www.lumithera.com.

About Keiretsu Capital, LLC  

Keiretsu Capital, LLC is an affiliate of Keiretsu Forum, the world’s leading angel investor network with over 1,500 investors in 38 chapters on 3 continents. Keiretsu Forum has invested more than $500 million into more than 700 companies since inception. Keiretsu Capital administers funds on behalf of its Limited Partners - the Co-Investment & Opportunities Fund creates a diversified portfolio of technology start-ups backed by top tier angel groups and pursues the high upside value potential in these dynamic investment opportunities while promoting the sharing of risk inherent in any early-stage venture.  The firm is based in Seattle and San Francisco and its principals are veteran Silicon Valley and technology investors Randy Williams, Matthew C. Le Merle, and Nathan McDonald. 

For more information please visit www.keiretsucapital.com or contact Keiretsu Capital public relations at press@keiretsucapital.com 

425 business, August 10, 2020: Interview with  Brianna McDonald on how to successfully raise funding during COVID.

Despite a worldwide pandemic, entrepreneurs and investors continue the quest to uncover emerging-market drivers and opportunities. At Keiretsu Forum, we have funded nearly all of the companies this year that have participated in our (now virtual) online investment forum, with a continuous flow of due-diligence packages completed or syndicated new deals successfully closed. 

We strongly believe there will be a V-shaped recovery for 85 percent of the economy; already there are favorable market indicators such as a stabilized and appreciating stock market. Available capital and liquidity also remain abundant. Companies that have significant demand drivers associated with COVID-19 are raising capital fairly quickly and efficiently in large amounts. Technology also remains an area of continued interest with a high quality of deal flow.

A silver lining is we expect to see leaner, more efficient, and more focused companies moving forward, ready to take advantage of a market recovery. If you’re considering funding or in the process now, here are seven steps early-stage companies can take to become more attractive to investors.

1. Strengthen the balance sheet by closing outstanding commitments, and explore venture debt and lines of credit.

Companies should exhaust every opportunity to generate additional working cash flow without taking on additional liabilities. One way is to convert lines of credit or venture debt into expanded cash flow. Likewise, companies with inventory will want to increase stock, even though there might be volatility in inventory drawdowns and/or potential supply chain challenges. To do such, close any existing sales or partnerships because they can provide additional flexibility and cash where applicable. For example, Palarum offers a product for hospitals that prevent falls and just completed key pilot studies. It recently concluded a three-year purchase letter of intent from a key customer, which is leveraged to acquire additional financing that covered the cost of the product rollout.

2. Negotiate with vendors/landlords/others to reduce or defer costs.

On average, our portfolio companies are negotiating reduced rates cut at nearly 50 percent. If no reduction is available, look to get two or three free months deferred to the end of the lease. You might be surprised at how easy it can be to negotiate favorable terms. Replacing a tenant is a high-cost landlord who wants to avoid for otherwise high-quality growing companies.

3. Immediately variabilize costs/shift to equity-based compensation where it makes sense.

A great way to reduce cash burn is to increase option pools and/or create more equity-based incentive compensation in the form of stock options available to executive team members. Less cash-out equals less cash burned! Equity-based compensation is tied to milestones and is considered a variable cost.

4. Slow down payables, including maximizing payment schedules against terms and conditions.

This is another case of “Ask and Ye Shall Receive.” Negotiate longer payment terms, and/or purchase upfront or in bulk. That can drive substantial price reductions and savings of as much as 50 percent.

5. Take swift action to cut costs and reduce burn rates — earlier decisions are rarely regretted.

Where are you focusing your marketing spend? Where are you focusing on your business development efforts? Is that spend really realistic going forward? Is engineering fully focused on where it should be? If not, cut back as much of that discretionary spending to further reduce the burn rate. Look at ways you can be a more efficient customer-focused organization versus a market-focused one.

6. Focus on revenue generation, reorder priorities, replan the road map to emphasize the top line.

Maximize the top line and get healthy around that line of business. Start by replanning the go-to-market road map, with a focus on the core values and core customers that maximize survival. Oftentimes companies try to do lots of different things, but in reality, there are only one or two things they do really well. Everything else is a distraction that drives excess costs. Focus on the customers who have money and will have significant demand for your product or service. Then make sure to take really good care of them!

7. Get in line now for government support/non-dilutive funding (e.g. DoD, NIH grants), etc.

Most companies have probably filed for PPP funding; if not, do so immediately, but there are other opportunities for government funding. Many of our life sciences and health care technology portfolio companies, such as XYZ, have applied for DoD and NIH grants administered via the Small Business Innovation Research and Small Business Technology Transfer (STTR) programs.

Brianna McDonald is president of the Northwest region of the Keiretsu Forum angel investment community.