Pitch Day for the NC IDEA Grants is a big deal, not just for this Fall’s 10-14 finalists, but also for the community.
For the finalists, it means the chance to secure up to $50,000 in non-dilutive funding, often at a critical juncture in the companies’ evolution. For the community, it’s an important barometer for the health and vitality of the early stage startups of North Carolina’s entrepreneurial ecosystem.
The health of the ecosystem is very strong, evidenced by this cohort of finalist companies, which pitched November 14 in front of NC IDEA judges. They were by far the most “mature” early stage ventures I have ever seen pitch at NC IDEA. By that, I mean that several of the finalist companies were led by serial entrepreneurs starting their second (or third?) ventures. They demonstrated poise, skill and confidence, along with the prerequisite passion, for those new ventures. Others recently graduated from accelerators and incubators. So while they may be on their first startups, they clearly benefited from the customer discovery process taught and coaching and connections made while in the incubator. They came across as more “investment ready” entrepreneurs.
But there’s always room for improvement. And this session, I observed that “use of funds” is often too vaguely described by the applicants. Applicants need to focus on one specific project that, if successful, will have a significant impact on the company’s prospects for success and/or valuation. It could be filing a patent, building a working prototype or testing and measuring the results of a software product with a specific audience.
I don’t believe the grants are intended to simply keep the business moving forward, but rather to have a significant impact. If you want some insight into what NC IDEA is looking for, just read its mission: “Selected companies will be given small grants to fund business activities that validate potential markets, reduce business risks, and advance projects to the point at which they are suitable for private equity investment.”
This cycle’s winners will be announced within the next two weeks, but I would argue that all of the companies selected to present (9 of 19 finalists) are winners. Because NC IDEA leverages the network of early stage investors and angels to vet and review these finalists, all of them are, in essence, pitching to potential funders simply by participating in the process.
So, if you are an early stage company and could use up to $50,000 to “de-risk” your venture or gain important intellectual property protection or prove your invention with a specific commercial market, be sure to take advantage of this important asset. I would encourage all North Carolina high-impact startup companies to apply for the next funding cycle in Q1 2015. And be specific about how you’ll use those funds to move your business forward.