Photo: Kirk Penton
Richard Takai (left) and John Sechrest at Kelowna’s Innovation Centre.
The Okanagan Angel Summit has named its six finalists, and one of them will be walking away with $125,000 next month.
Daniel Rondeau of 925 Freelancing, Ian Paterson of Plurilock, Peter O’Brien of VO2 Master, Austin Walper of PLAYR.gg, Justin Goodhew of Trellis and David Brough of Klonetics are the last ones standing of the 44 startup hopefuls who entered the Accelerate Okanagan competition last fall.
Each finalist will give a pitch to the 27 investors on April 11 at the Innovation Centre, and the group will then meet to decide which one gets the cash to grow his business.
The 27 investors pitched in $5,000 to take part in the Okanagan Angel Summit, which has been as much about learning how to angel invest as it is to give money to the lucky winner. John Sechrest, who started the Seattle Angel Conference and is a driving force behind angel investing in the northwest U.S., was recruited to help Okanagan’s first foray into capital fundraising.
“If you took the top 10 per cent of the wealthiest people in Kelowna, and you got half of them to write a few $5,000 cheques a year, how much money would that be going into the ecosystem, and how would that be different than what’s going on now?” Sechrest said. “So that conversation led to us working on the Okanagan Angel Summit.”
The 44 startup businesses who entered the summit were whittled down to 24 quarter-finalists, 13 semifinalists and then the six finalists announced Tuesday. All along the way investors listened to pitches and learned as much as they could about each company. They also took part in an angel investing workshop.
Grant Thornton senior manager Richard Takai is one of the investors, and he said bringing together some of Kelowna’s wealthier people should lead to only better times down the road. In other words, the investing doesn’t have to stop on April 11 when the summit’s winner is declared. In fact, two of the startups that didn’t make it past the quarter-final round have garnered investment interest.
“This program is intended to create those kinds of connections and interest in people forming their own funds,” Takai said. “Those discussions are taking place right now.”
The success rate of companies that receive angel investment money is similar to the venture capital field, according to Sechrest. About 30 per cent lose all the money, 30 per cent lose some of the money, 30 per cent make some money, and the final 10 per cent make a lot of money. Angel investing is a way for investors to contribute a relatively small amount of money to help get new businesses off the ground.
And interestingly, Sechrest said not every investor is in it for the money.
“Some people want to do it because it makes them look good,” Sechrest said. “Some people want to do it because their friends are doing it. Some people want to do it because they want to see a difference in the world. Some people do it because they want their kids to have a job.
“If you went through and talked to all the different investors, I bet you that at least 80 per cent of them have some auxiliary reason for doing it besides wanting to make more money.”
Takai said the process has been a lot of fun for the investors and that there has been plenty of good energy in the room when they met to discuss who moved on and who didn’t. The goal is to keep finding more angel investors and running the summit at least once a year.
“We’ll do it once a year to start. If we have enough traction and interest from both companies and investors, we’ll try to get that up to two a year as well.”
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