This article first appeared in the St. Louis Beacon: When his slide clicker malfunctioned up on stage, Brian Kohlberg kept his cool. Afterward, he was philosophical.
“It was just one of those things I can’t control so I had to keep moving on and show the resilience of our company,” chuckled Kohlberg, founder of Manufacturers' Inventory, an online marketplace for industrial and electrical components. “We’re going to hit some bumps in the road….we’ll still make it through.”
It’s a spirit of optimism that might describe not just Kohlberg’s enterprise but any of the 11 presenters who pitched to dozens of investors at Wednesday’s Demo Day, Capital Innovators’ annual showcase of local up-and-coming IT businesses on the start-up scene. Among those strutting their stuff in eight-minute presentations at the Pageant this year were an analytics service to help lawyers predict the actions of juries and judges, a concierge company that connects customers with caterers and an electronic platform to encourage fans to stream music from their favorite band.
“This is a bit of a graduation ceremony for the companies,” said Judy Sindecuse, CEO and managing partner of Capital Innovators. “It’s like their coming out party.”
The idea is to expose companies to angel money and venture capital folks. Of the more than 500 people who signed up to attend the afternoon’s event in the Loop, just over 70 were investors.
Sindecuse said that with the 24 companies in the organization’s portfolio, the area has seen 350 jobs created and about $37 million in follow-on funding – not to mention an increase of 3.5 times the portfolio’s value.
“The companies from those earlier classes have really grown dramatically and we are really excited about the 'dealflow' that we see,” she said.
Walter Harrison is happy to have been a part of that dealflow. The founder and CEO of the Sea App, a concept that streamlines price comparison shopping for an array of products from shoes to books to car parts, said the investment in his company from Sindecuse’s group has really helped to open other doors.
“You get the stamp of approval from Capital Innovators just by being selected,” he said. “Now I just give them my business card or introduce myself and they’ll likely come by our booth.”
The St. Charles native said he’s thrilled to be able to stay in town and build the business he founded in 2010.
“So many people go out to the West Coast or New York,” he said. “I think we are a strong entrepreneurial city at our core.”
Kohlberg agrees, noting that the organization has helped raise the profile of the entire area.
“The outreach and the street credibility are really what we’re looking for with events like this,” he said. “We can bring in some great investors from the region and all over the country to see what St. Louis is really working on and the type of companies that Capital Innovators are bringing to the table. It’s great to be a part of (that).”
Kohlberg’s whole team is from the Gateway City. He said the change in culture in recent years is palpable.
“Growing up here, we didn’t actually think these kinds of opportunities existed: to be entrepreneurial and have resources, mentors and money here to help us do what we want,” he recalled. “Over the last couple of years, being inside the ecosystem, understanding that there really is a great team atmosphere around here and a St. Louis entrepreneurial spirit that more and more companies, personnel and investors are tying onto, has given us a great opportunity to stay home.”
Others may be returning home. St. Louisan Peter Meng originally went in 2004 to Columbia where he would go on to co-found his business, AdFreeq, an electronic classified ad platform.
“I’m a serial entrepreneur and there was nothing going on here,” he said bluntly of life in this city nearly a decade ago.
He feels differently today. After his pitch, Meng compared the confab favorably to a similar out-of-town get together he attended not long ago in a traditional tech haven. He liked Demo Day better.
“There were more people in this room today than there were in Silicon Valley for one of their premiere events,” he said.
AdFreeq, which is expanding into potentially lucrative markets in China, may soon create an office in St. Louis.
“Now we’re headed back this direction because it is vibrant here,” said Meng. “It’s amazing what a few people with passion have been able to do to get things going. There’s a lot of energy and a lot of young people who are staying because there are opportunities.”
He believes St. Louis gives a chance for young startups to get their feet wet in a less hostile environment than they might encounter elsewhere.
“If you went to the West Coast, you (would) get beat up pretty good pretty fast,” he said.
Meng said Capital Innovators has been of enormous help and it is not just the $50,000 seed capital investment or the training and mentoring.
“The money is good. It’s helpful,” he said. “It’s not enough to really build your business on, but it is enough to really work through that semester and take the time that you need to get your business organized right.”
However, the networking opportunities are extensive as well and not just with investors. Other entrepreneurs can be a help too.
“They are all in the same boat. You can talk through ideas,” Meng said. “Two or three other companies, we’re actively talking to about integrating their stuff into our product. We wouldn’t have even known they ever existed if it weren’t for Capital Innovators.”