New Pasadena Angels Site Launches

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Angel Investing / Bluebeam / Pasadena Angels / Raising Captial

Pasadena Angels, Inc. 2013-09-10 08-34-03

The Pasadena Angels have redesigned our site with a new focus on Entrepreneurs and LA Basin tech resources.

We took a lesson from successful companies we have funded–we talked to the market first.  We started by surveying a group of local entrepreneurs and our own members to find out what they wanted in a site.  The message that came back was very clear–both groups wanted a site that showed that: 1) the PA are actively funding companies, 2) are engaged with the local tech community, and 3) made it easy to apply for funding.  We rebuilt the site with that in mind.

Check us out at–you’ll hear the voice of local entrepreneurs, talking about what it’s like to work with the PA.  You’ll see a long list of companies we’ve funded.  There are links to great community resources like Innovate Pasadena and others.  And “Apply Now” buttons everywhere.

We are grateful to Chris English of Chris English Design for his hard work and wise counsel as we rebuilt the site.

Let me know what you think!


The Best Pasadena Tech Company You’ve Never Heard Of

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Angel Investing / Bluebeam / Innovate Pasadena / Pasadena Angels

Why are there great tech companies in Pasadena that no one has heard of? Sometimes the answer is that the team is too busy building a great company to worry about generating press outside their own industry.

One example is Bluebeam. They are revolutionizing the Architecture, Engineering and Construction industries by eliminating the need for hard copy blueprints. They employ 100+ people, have substantial sales, are profitable, and have hundreds of thousands of users world-wide. Had you heard of them?

Bluebeam’s technology is phenomenal. They enable multiple contractors, architects, and engineers to share CAD-generated blueprints on tablets or iPads as PDFs. In the field. With no paper. Saving months on major construction projects. You can learn more about the products here: Bluebeam Products.

Bluebeam CEO Richard Lee

Bluebeam CEO Richard Lee

Their story is amazing. Bluebeam started as a spin-off from a JPL-focused engineering company some eight or nine years ago. They have achieved great success by building pioneering products that meet a real need. And they have done it all with minimal financing–a Pasadena Angels round years ago.

Back to the original question–why is Bluebeam so invisible? They have chosen not to focus their PR efforts on the general press. In their own space, they’ve generate 20+ articles so far in 2013 and attended many conferences around the globe. They chair the standards committee for PDF users in the AEC space. The local tech press? Only Ben Kuo from SoCalTech has noticed them. There’s a listing on CrunchBase, but that’s about it.

We could all take a lesson here–keep your head down, build a great company, and let the LA Tech Scene buzz take care of itself.

That said, we still need to put Pasadena on the map as the real tech hub it has already become. Companies like Bluebeam point out the reality. Innovate Pasadena has begun the process of making the area more visible, and you’ll be seeing more in the months to come. Stay tuned, and watch a new tech hub blossom.

Obama’s SEC Trying to Kill Entrepreneurship

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Angel Investing / Entrepreneurs / Pasadena Angels / Raising Captial



Overwrought headline?  Hardly.

New SEC regs will destroy your ability to raise capital.

In a nutshell, new SEC rules will REQUIRE entrepreneurs to register with the SEC BEFORE approaching investors.  Worse yet, Angels will no longer be able to “self certify” as accredited investors–we will have to show W2’s or proof of our net worth, and most of us will never be willing to share such personal information.

And did I mention that pitch events will become a form of illegal solicitation?

Here is the Angel Capital Association’s take: SEC regs.

Please–call your Congressman, write your Senator, and post a comment at the SEC’s website.

Why is all this happening?  Because our Nanny State thinks Angel Investors need “protection”.  I normally try to keep my politics out of my blog, but this is ridiculous.  Startups create most of the jobs in this country, and unemployment is intolerably high.  So the solution is to cripple capital formation for startups?

This Administration and the SEC have lost their minds.  Do everything you can.  Your funding depends on it.

Creating B2B Mobile Apps

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Entrepreneurs / mobile apps

I’ve recently joined Malauzai Software, a developer of Mobile Banking Apps for Community Banks and Credit Unions, as their Chief Sales Officer.  Even though I’ve been involved with SaaS products since 1998, the last few months have been quite the education.  Delivering apps to a wide variety of financial institutions is dramatically more challenging than I expected, and my experiences illustrate many of the issues you can expect if you build a B2B app company.

Malauzai has signed 130 banks, and has 94 live with native apps across the iPhone, Android, and iPad platforms.   The look and feel of the apps are customized to each FI (financial institution), and the UIs range from stately to playful.  Each bank or credit union chooses its’ own array of functionality from a standard set we maintain and grow over time.

One hot new deliverable is Picture Pay–a new feature that lets consumers pay bills by simply taking a photo of the bill with their mobile device.  This commercial from one of our customers explains it in 33 funny seconds: First Financial Bankshares commercial.

A few takeaways: 1) businesses that buy apps are feeling real pressure to make their apps cool.  Banks are jettisoning their generation 1.0 apps, which are often rewarmed internet banking functionality, in favor of generation 2.0 apps that take full advantage of the platform.  2) There is huge demand to be first to market with new functionality.  Picture Pay is a good example.  3) keeping existing customers current is going to be challenging in this environment.  We launch new functionality more frequently than our banks want to update their apps.  Finding the right balance between frequent updates and not inundating customers with updates is going to be an interesting balancing act.

Stay tuned…I’ll post more as we move forward.


Progress in Pasadena, Part II

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Angel Investing / Entrepreneurs / Incubators and Accelerators

The Pasadena Innovation Council organized a great tech executive meeting in Pasadena on Friday.  A group of 20 or so local entrepreneurs gathered at Jones’ coffee to meet, share stories, and talk over new ventures.  This is another good step toward pulling together the tech community in the greater Pasadena area.

It was a great crowd.  Ted Tekippe, CEO of Doublebeam joined us, as did Kevin Scanlon, Chairman of the Pasadena Angels.  Andy Wilson, CEO of Rexter and leader of the Innovation Council, hosted us.   Several members of the old Overture mafia attended, as did a number of entrepreneurs who have recently started companies in the area.  Erik Hovanec also joined us to update the group about the new accelerator being developed by the Art Center College of Design.

Two key conclusions emerged: 1) it was great to be with such an interesting group without driving to Santa Monica, and 2) we’ll be doing it again, and in a bigger venue.  You can find out about the next gathering at Innovate Pasadena.

Here are a few candid shots of the event:

Andy Wilson and guests, thinking megathoughts

Andy Wilson and guests, thinking megathoughts

Erik Hovenec discussing a new Pasadena Accelerator

Erik Hovenec discussing a new Pasadena Accelerator

New Tech Center Emerging in Pasadena?

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Entrepreneurs / Incubators and Accelerators

pasadena banner

Pasadena may be the best tech story never told.  Somehow the home of IdeaLab, OpenX, CalTech, Art Center College of Design, and JPL doesn’t have much of a reputation as a innovation hub.  A number of tech companies, such as Bluebeam and Materia, are quietly building powerful businesses, and many startups are in Old Town.  Still, Pasadena never hits anyone’s radar as a hot tech destination.  We can put a rover on Mars repeatedly, but can’t get press coverage as a tech hub.

Andy Wilson, CEO of Rexter and one of the Partners in Momentum Ventures, is leading an effort to change that situation.  The Pasadena Innovation Council, led by Wilson, has brought together the City of Pasadena, CalTech, the Art Center School of Design, the Pasadena Angels, and area business leaders and entrepreneurs to support the growth of the Greater Pasadena Area as a tech center.

The goals are straightforward: 1) brand the Greater Pasadena Area a desirable location for tech companies to startup or locate, and 2) encourage collaboration among companies.

As always, the challenge is in the execution.

The Council has been meeting every two weeks or so for the last quarter, and I’ve joined several of the meetings.  There is a bit of a startup feel to the sessions–we meet in borrowed space–IdeaLabs, Materia, CalTech.  Since the meetings are usually 5-7pm, various attendees contribute wine (critical to the creative process) and snacks.  People arrive after a full day at their “real” job, but there is still energy in the room.  It’s a committed group.

The meetings are challenging–this is a strong willed group of business, academic, and City leaders, and they have (ahem) firm notions about how to proceed.  The City of Pasadena has given great support.  City Manager Michael Beck regularly joins us, as do representatives from CalTech, the Art Center, and the Pasadena Angels.  There is a real partnership emerging among all the players, and the group has coordinated efforts for the Pasadena StartUp Weekend, and is bringing in Brad Feld to speak in the near future.

You can follow Pasadena’s progress at Innovate Pasadena on LinkedIn.

Angels to the Rescue

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Angel Investing / Entrepreneurs / Raising Captial

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One of my favorite Dave Berkus quotes is: “Never, never, never run out of money.”  But inevitably, it happens to some startups.  What then?  Your VCs and lenders will likely impose onerous terms, and your ownership will get badly diluted.  The one group of investors you can count on to support you in a crisis are your Angels, and I saw two examples over the Holidays.

Two companies, with funding from the Pasadena Angels and Tech Coast Angels, ran out of money and needed a few hundred  thousand dollars to reach the next stage in their growth–an exit for one, and profitability for the other.    I won’t mention their names, as it would be inappropriate, but both are LA-based companies that have been operating for several years.

Over a few short weeks during the Holidays, groups of Angels, one  led by Dave Berkus, raised enough money to secure the futures of these companies.   A Christmas miracle, indeed.

The terms?  Emergency cash is never free, even from Angels.  I saw the deal terms for both, and invested in one company.  The terms were the same as the prior raise, plus a modest amount of warrants as an incentive to close quickly.  No cramdown, no significant dilution of management.

This story highlights a key point–unlike many other investors, Angels are there for you in a crunch.  We all expect to make more than one investment in companies, and so long as the business is making progress, are a great source of small to medium follow on rounds.  Even in a crisis, Angels typically rally around their companies, rather than using the maximum leverage to drive harder deal terms.

I often hear from fellow entrepreneurs that raising money from traditional Angel groups is difficult, and it can be true.  But there is another side to the story–once your Angels are on the team, they are there for you in good and bad times.   It’s something to remember when you’re deciding whose money to take.

Storytelling and Startup Fundraising

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Entrepreneurs / Raising Captial

Every startup has an elevator pitch, but what comes next?  Do potential investors’ eyes glaze over when you get beyond the quick, punchy one liner and try to REALLY describe your company?  Successful fundraisers tell a complete, engaging story and close the deal.

Last week, the WSJ ran a great article on the value of college humanities courses, and used comments from a successful entrepreneur to make their case.  I have to confess that I almost ignored the article, thinking that it was one more elaborate defense of worthless, expensive humanities departments that should be defunded in favor of more math, science, CS, and business classes.  I was wrong, and the article was a good reminder that telling your company’s full story is a critical element in raising capital.

Malauzai is an example of a company that tells its’ story well.  The company builds a SaaS mobile banking platform for community banks.  Malauzai, founded by Tom Shen, is in the midst of raising a series A round to fuel rapid growth.  The core idea is very simple—give community banks a powerful, customizable platform that allows bank customers to bank via their smartphones.

The bigger story?  Tom does a great job laying out his heartfelt conviction that community banks are critical to the economy and the fabric of local communities.  He then takes that emotionally gratifying picture—local bankers battling it out with the likes of Citicorp to serve their communities—and builds on it with the idea that Malauzai software turns the local bankers into formidable competitors armed with new technology that the big guys are slow to adopt.

It all flows into a great story.  Mobile is important.  Community banks are an essential part of the financial landscape.  With the right technology, they can compete with the Megabanks and Wall Street.  And Malauzai collect a monthly per user fee for each consumer.  What’s not to like?

And the story gets better as you dig deeper.  Tom has had two exits in bank technology.  One of his early investors is a key banking software provider with hundreds of customers.  Several members of his Board have very deep experience in the bank technology space.  They have 100 customers on the platform already, and they are so excited about the product that they put it on billboards.  It all hangs together.

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The net result?  A very attractive package, and a story that is easy to comprehend.

Does your investor pitch tell a story, or is it a disconnected jumble of elevator pitch, market sizing, technology and financials?  People like and relate to stories on an emotional level.  Learn to tell yours.

SwingBySwing: Making Golf More Social

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Angel Investing / Entrepreneurs / Incubators and Accelerators / Sales

There are days when I feel like we’ve gotten a bit carried away with social media.  You get bombarded with Facebook requests–P&G wants me to “like” their consumer products, as if Tide is my best pal.  You can’t go to a website without getting hit with requests to do something on Facebook, Twitter, LinkedIn, Pinterest, ad nauseum.  But once in a while, someone gets it right and delivers a social experience that benefits the consumer instead of companies promoting a product.  SwingBySwing (SBS) has done it.

Two million consumers have downloaded the SBS golf app that includes a rangefinder (using the GPS chip in your phone), course maps, scoring, and more.  Now SwingBySwing has offered their users the chance to share their experiences on the course in real time, and the adoption rates are rapidly increasing.

Golf is  a social sport–you play it in a foursome, surrounded by other players on the course.  It’s natural to share experiences and banter  in the clubhouse over a beer and a hamburger after the game.  But what about sharing those experiences with golfing buddies who are not on the course with you?  Wouldn’t you like to be able to show your great shot to an out of state pal?  With SwingBySwing you can.

The latest version of the SBS app lets you post to Facebook, Twitter, and their own photo repository while you play.  Your friends get realtime updates on the course, your score, pictures, and your latest great shot.  You can post items to Facebook and Twitter, or send people to to see everything at once.

You can see an example of the information on SBS here: My Round

How do consumers like it?  Check the graph below–the functionality was just released, and consumers are adding pictures, scores, and other data at a sharply growing rate (Q4 is forecast):

No gimmicks, contests, nor crazy videos.  Golfers are sharing the information because it lets them expand the social aspect of golf beyond the course.  What’s the upside to SwingBySwing?  More users, more traffic, more content, and more data on golfers and their habits.  SBS is building the premier  platform to reach the 26 million Americans who play golf.  And they are doing it the old fashioned way–making their users happy with the product.