dsmWealth: May 2, 2024

Venture capital is available, if you know who and how to ask
BY STEVE DINNEN

Drake Bauer is a confessed gearhead. He’s loved cars his entire life.

“I think I left the womb with a Hot Wheel in my hand,” said the Colorado native, who grew up in Decorah and now lives in Des Moines.

Bauer thinks he can make money, maybe a lot of it, with a process he is developing to help automobile owners such as rental firms better manage their fleets. “There are a lot of inefficiencies,” he said of oil changes, tire rotations and repairs that disrupt the flow of vehicles through a fleet.

He thinks he can fix that. But first he needs to get some money — again, maybe a lot of it — and is turning to venture capital as he builds a plan. Last month, at a Greater Des Moines Partnership seminar designed to help startups raise capital, he learned some of the ins and outs of venture capital in particular — what it is, how it works, how to ask for it and whom to ask.

Tread lightly here, Bauer cautioned. Ask for too much money “and you might turn people off.”

Or you might not even know how much you’ll need. Google co-founders Sergey Brin and Larry Page were in a breakfast meeting with Silicon Valley powerhouse Andy Bechtolsheim when he cut the meeting short but wrote them a check for $100,000, which they couldn’t even cash because they didn’t yet have a bank account. But that initial investment greased the skids, and when Google went public six years later, Bechtolsheim’s seed capital was worth $1 billion.

We should all be so lucky. Kaylee Williams directs investment at InnoVenture Iowa, a $30 million public co-investment fund, which was funded by the federal American Rescue Plan. She described a balancing act between asking for enough money to help your business succeed and asking for too much, which could dilute your ownership. “The more you fundraise, the more of your company you’re giving up,” she said. “You only raise as much as you need.”

That’s lesson No. 1. But to get that far, you have to have a product, a business plan and a polished pitch you can make to potential investors to convince them that yours is a good idea. This entails wiping out doubts that investors may have by telling them what you know, not what you think, Bauer said.

Williams said that venture capital is available at local, state and national levels, especially for startups that can demonstrate intellectual proprietorship (IP). There are various forms of intellectual property, including patents, trademarks, copyrights and trade secrets. The person who comes up with a concept or idea has the IP — and attracts the venture capital.

Iowa seminar series helps startups seek venture capital
BY STEVE DINNEN

Venture capital is available, but you have to know where to find it and how to ask for it. InnoVenture Iowa, a public venture capital fund, can help you make those connections.

They call it the “Heartland Hustle: How to Raise Venture Capital For Your Startup.” It’s a series of seminars meant to provide budding entrepreneurs and innovators with information they need to successfully attract venture capital. It could be seed money. It could be Series A funding. Whatever it’s called, it boils down to developing a business plan that will attract outside capital to enable your enterprise to thrive.

“We introduce the concept to (company) founders,” said Kaylee Williams, workshop presenter and investment director at the Iowa Venture Capital Co-Investment Fund. “When do you raise it? How do you raise it?”

The series began in April and runs through the end of May, or perhaps longer as more cities sign on as site sponsors. Upcoming events are slated for May 9 in Indianola, May 17 in Oskaloosa and May 30 in Fort Dodge.

The workshops are free, but online registration is required.

Fearless panel on financial empowerment: It’s not just the wage gap keeping women from security
BY NICOLE GRUNDMEIER

Kara Hoogensen told her co-panelists an uncomfortable statistic.

“The fact is, there’s five panelists here on this event today. Odds are, at least one of us is going to go through a period of time during our career where we’re unable to work for a lengthy period of time. And it can be a very big challenge,” said Hoogensen, senior vice president and head of workplace benefits – benefits and protection at Principal Financial Group.

One solution can be good partnerships between the government and the private sector, she said.

“So one of the movements here in the states – and we are seeing this happen – more states embrace paid family medical leave programs and more employers that are supplementing those programs. Or in states where those programs don’t exist, offer short-term disability coverage for purposes of people at least taking care of their own illness and injury and having an income stream,” Hoogensen said.

Women are traditionally the caregivers — of children, of aging parents, of the sick and the dying. Women are more likely to suffer from autoimmune diseases. Women are more likely than men to be diagnosed with anxiety and depression. They also typically outlive men. All of this can affect their career trajectory, their budgets and their finances.

Over the years, many Iowa women have told Fearless that they struggle with aspects of their personal finances. They’re often ashamed. To help Iowa women with this challenge, our first Fearless Focus panel of the year was on financial empowerment.

The April 18 panel included:
Kara Hoogensen, senior vice president and head of workplace benefits – benefits and protection, Principal Financial Group
Marcie Ordaz, executive director, Lift Women’s Foundation
Sonya Sellmeyer, consumer advocate, Iowa Insurance Division
Ashlee Vieregger, senior lead adviser, Foster Group
Michele Williams, associate professor, management and entrepreneurship, University of Iowa Tippie College of Business

Suzanna de Baca, president and CEO of Business Publications Corp., introduced the panelists. Emily Wood, the Business Record’s special projects editor, moderated the discussion.
Wood’s first question was solutions-oriented: What is one financial barrier that adversely affects women? How does the business community play a role in addressing it?

The following responses have been edited and condensed for clarity.

Hoogensen:
We find that 68% of women, relative to 80% of men, feel financially secure. What do we mean when we say “financially secure?” We mean, they feel comfortable that they can get a loan. They feel comfortable that they can get a mortgage. They feel comfortable that they can make investment decisions, whether that be an employer-sponsored retirement plan or outside of that. So, there is absolutely a discrepancy here.

Employers play a big role. Employers are the most trusted institution in the United States. From my perspective, the role that employers play in helping their talent, particularly their female talent, make sure that they understand what they have access to and provide the education and support. To really get super specific around one of the challenges that we focus on at Principal – that really is the income-protection gap.

The child care responsibilities, being able to take time off, whether that be for one’s individual illness or sickness or to care for a loved one, is a major issue. If there’s not an income stream coming in, you as an individual may or may not be in a position to be able to do what in your heart of hearts you want to do in providing care for another or for oneself.

Read the rest of the responses here.

How changes to ‘noncompete’ agreements and overtime pay could affect workers
BY CATHY BUSSEWITZ AND MAE ANDERSON FOR THE ASSOCIATED PRESS

For millions of American workers, the federal government took two actions last week that could bestow potentially far-reaching benefits.

In one move, the Federal Trade Commission voted to ban noncompete agreements, which bar millions of workers from leaving their employers to join a competitor or start a rival business for a specific period of time. The FTC’s move, which is already being challenged in court, would mean that such employees could apply for jobs they weren’t previously eligible to seek.

In a second move, the Biden administration finalized a rule that will make millions more salaried workers eligible for overtime pay. The rule significantly raises the salary level that workers could earn and still qualify for overtime.

The new rules don’t take effect immediately and won’t benefit everyone. Read more about them here.