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|Articles - February 2011|
|Thursday, January 27, 2011|
Page 5 of 7
The first company the Oregon angels voted to invest in was Lumencor, a California transplant that developed a sophisticated light engine for bioanalysis. The husband-and-wife founders Steve and Claudia Jaffe reversed the prevailing migration pattern for growth companies by moving from Silicon Valley to Beaverton to build the company in December 2006. They placed second in the 2007 Angel Oregon contest, landed $197,000 from the fund in September of that year, and set to work developing, manufacturing and marketing their products, with help from mentors such as Pixelworks co-founder Bob Greenberg and later DesignMedix CEO and biotech veteran Lynnor Stephenson.
They also tapped into a talented pool of optics experts from a local community that has seen several big successes in that niche. It was not an easy time to launch an ambitious new business but the founders kept at it, and with time the product took hold. VP Claudia Jaffe says the company has been living off revenue since October 2009, and employs 15 people in Beaverton.
A more recent investment supported a similarly ambitious medical devices company called Clear Catheter Systems. Dr. Edward Boyle moved from Seattle to Bend in 2001. A cardiothoracic surgeon by training, Boyle teamed up with researchers from the Cleveland Clinic to develop a device that prevents blood in catheters from clotting (these clots can lead to expensive and dangerous problems for patients and sometimes death). The company’s product, PleuraFlow, received FDA approval in December 2010.
The Oregon Angel Fund invested in Clear Catheter last year and placed 40-year medical device industry veteran Jim Fee on the board after Fee led the due diligence team. Boyle says Fee’s experience proved a huge asset as the company moved to hire the right sales executive to ramp up marketing after FDA approval. “Jim was very involved in helping me draw up the job description and recruit the right person. It was good to have him in the room, and I think it was good for the applicants to see him there too. We made the hire and he’s been doing great.”
Of course, angels do not give away their money and expertise for free. Entrepreneurs must work hard to earn their support, often coming before the group multiple times before landing an investment. And the terms of the deal don’t always please the recipients; at least one growing company, advanced food processor Columbia Phyto Technology, recently turned down an OAF investment because the founders were uncomfortable with the terms. Other entrepreneurs get put through the wringer repeatedly, revealing insider details about their nascent companies, only to be voted down in the end.
But the process is challenging for several reasons. First of all, the angels want to make sure they are investing in the best of the best. Secondly, they want to help the businesses that don’t make the grade to improve their plans and apply again. Giftango CEO David Nelsen, who has managed to expand aggressively during the downturn thanks to angel support, describes the process as worth the effort. “It’s more than them just giving you money,” he says. “It’s them taking you through a process that makes you a better entrepreneur.”
OAF invested half a million dollars in Giftango in 2009, and outside investors followed that up in 2010 by pouring in another $5 million. That money enabled the electronic gift cards company to expand into a new office near PGE Park in Portland and grow to 17 employees in time for the holiday rush season. Nelsen credits the Oregon angels with enabling that growth. “After having gone through that process with OAF, our series B round was pretty easy,” says Nelsen. “It made things easier for us at the next level.”
Other local companies have enjoyed healthy success since receiving backing from OAF. Portland-based Jama Software, which received $400,000 from the fund in 2008, has grown from eight people to 20. “Their revenues have quadrupled since we started working with them,” says Drew Smith, who led the due diligence team and sits on Jama’s board.
Another rising star from the OAF portfolio is Portland-based Elemental Technologies, a video processing business led by some of Greenberg’s former colleagues at Pixelworks. Elemental has raised $15 million and is aiming for $10 million in revenue next year. “They’re off to the races, and it’s great to see,” says Greenberg. He led the due diligence team for Elemental and serves on the company’s board.
Greenberg spent 20 years growing with InFocus and Pixelworks before delving into investing. He says he is more than happy to share his experience with the next generation of entrepreneurs. “We need people who have gone through the mill to nurture the next InFocus and the next Pixelworks,” he says. “We need more of those successes in Oregon.”
Friday, March 27, 2015
BY ROBERT MULLIN
A new energy-sharing agreement sparks concerns about independence and collaboration in the region's utility industry.
Thursday, March 26, 2015
BY LINDA BAKER
Everyone knows cell phones and driving are a lethal combination. The risk is especially high for teenage drivers, whose delusions of immortality pose such a threat to us all. Enforcement alas, remains feeble; more promising are pedagogical approaches aimed at getting people to focus on the road, not their devices.
Friday, March 27, 2015
BY OB STAFF
New events series brings magazine to life.
Friday, April 24, 2015
BY BEN DEJARNETTE | INVESTIGATEWEST
Timber companies and environmental groups take a stab at collaboration to boost logging and restoration in Oregon fires.
Friday, May 15, 2015
BY KIM MOORE | RESEARCH EDITOR
The Portland Bureau of Transportation is seeking input from businesses on a $5.5 million initiative to create a network of biking, transit and pedestrian trails within Portland’s central city.
Thursday, March 26, 2015
BY KIM MOORE
A conversation with Craig Wanichek, president and CEO of Summit Bank.
Friday, April 17, 2015
PHOTOS BY JASON E. KAPLAN
The 32nd annual CBC attracted a record number of attendees (11,000) to the Oregon Convention Center.
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New conference aims to solve challenges, quell fears amid regulatory changes.
Tourism marketing supports entrepreneurship by attracting visitors to all corners of the state.
Beaverton firm's business intelligence platform rivals that of industry heavyweights.
The Oregon Entrepreneurs Network (OEN) will be presenting its third annual Entrepreneurial Summit on Friday, June 5 at Castaway in Portland, Oregon.
On June 13th Mayor Charlie Hales will attend nonprofit organization Dream Change’s inaugural Love Summit and will introduce one of its keynote speakers, Dan Wieden of Wieden+Kennedy advertising agency.
34 spots for food, 17 places to sip, and 7 sites to choose a brew beckon visitors.