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Home / Articles / Santa Fe Guides / Local Economy /  Get Start-Uppity
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Santa Fe Business Incubator

Get Start-Uppity

Are you an entrepreneur or a wantrepreneur?

March 16, 2011, 1:00 am
By SFR

On its sleepy, brown exterior, Santa Fe isn’t exactly a hot stew of entrepreneurial angst and venture capital cool, but a closer look reveals a community ripe with ideas and plenty of high-level investors willing to take a chance on smart business concepts. Two venture capitalism professionals offer their takes on the Santa Fe landscape, sage advice and a list of resources for ideas and entrepreneurs in need of heavenly help.


Like many smaller towns and cities, Santa Fe confronts the problem of achieving critical mass and sufficient differentiation in its entrepreneurial ecosystem. While Santa Fe’s rich cultural environment and high quality of life draw many educated, talented people with the ideas and skills to start companies, the supply of veteran entrepreneurs is limited. Santa Fe also has active early stage angel investors––with monthly meetings by organized groups such as the New Mexico Angels––as well as individual high-net-worth investors who enjoy hands-on investing in local start-ups.

Entrepreneurs probably wish there were more active investors, but my sense is the raw supply of angel- and VC-ready deals is in fairly good balance with the investor demand here in the city. 


Beyond the never-ending search for highly experienced veteran entrepreneurs, Santa Fe could stand improvement in two areas: a diversity of investors for the more developed angel- and VC-ready deals, and support for the true early stage seed ideas. On the first point, for five years I have watched really terrific life science (biotechnology, pharmaceuticals, environmental technologies, etc.) deals here in Santa Fe struggle to find investors. Key life science venture firms left the market, and angels hesitated to play in that specialized area. However, there are recent wins on that front, as evidenced by several new life science firms with great management teams that found backing and have taken up residence at the Santa Fe Business Incubator. The other gap lies in very early pre-seed “idea development”-type projects; those with potential to grow into real products and real companies if they were able to find support to get to a solid prototype or a beta app to the testing and marketing stage. Even elsewhere, many of these projects are funded in the time-honored bootstrap method: sweat equity, and long nights and weekends, while the entrepreneur toils away at a day job.


However, we need more buzz and excitement and awareness to help these folks along. I’m not talking funding, but I am talking support. Getting more people to invest themselves in these ideas and trust that angels and venture capitalists will be there when they get their idea to an investment-ready phase, or to believe they can create a self-funding business model and grow it themselves, will depend on role models and assistance out in the community. I know that sounds kind of soft and fuzzy, but being in an entrepreneurial hotbed such as Silicon Valley or Austin naturally helps would-be entrepreneurs find the role models, mentorship, examples and introductions that make the difference between being a guy or gal with an idea that never sees the light of day and being an entrepreneur leading a company. We humans are “monkey-see, monkey-do” primates, after all. Here in Santa Fe, our beloved city just doesn’t have the raw supply of role models and venture capitalist-littered coffee shops that more entrepreneurial cities naturally possess. We need to highlight and help our brave and talented entrepreneurial “monkeys,” our successful entrepreneurs, and the small business owners and tinkerers living quietly in our midst in order to inspire our latent entrepreneurs to take that first real step toward starting companies.

—Stephanie Spong
Managing director, Moksa Ventures, an early stage venture fund building out the game layer
President, New Mexico Venture Capital Association



Santa Fe has an improving landscape for entrepreneurs and start-ups. We live in an area where there are a number of programs in the region that assist entrepreneurs (ie Northern New Mexico Connect), investors who are truly accessible and approachable, and an increasing variety of events to foster networking among entrepreneurs and young professionals. Successful entrepreneurs are hanging out at places and events where they can hang with other entrepreneurs, and get to know local angel investors and venture firms. This community is just small enough that one can become easily connected. It’s also small enough that investors can pretty quickly figure out in whom to invest. What’s hot: getting out, being visible and meeting people face to face by attending a Santa Fe MIX event or a Coronado Ventures Forum, presenting at an Ignite, or participating in a Springboard. It’s a no-brainer; entrepreneurs and investors very often hang out in the same places. What’s not hot: expecting to find investors by simply sending out your business plan via email, or leaving dozens of phones calls requesting a meeting. It’s a long line. You need to set yourself apart from the pack, and it helps if the investors know you or if you are referred by a trusted source. Establishing a reliable network won’t happen if you stay at home.

—Lillian Montoya-Rael
Principal at Flywheel Ventures


REFERENCES

An angel or angel investor is an individual who provides capital to one or more start-up companies. Unlike a partner, an angel investor is rarely involved in management. Angel investors can usually add value through their contacts and expertise.

New Mexico Angels
mission is to provide opportunities where its members can obtain outstanding financial returns by investing in early stage companies in New Mexico and the Southwest region, and accelerating them to market leadership.

The Santa Fe Business Incubator helps local entrepreneurs grow successful businesses. These emerging companies create new jobs, increase our tax base and diversify our economy, enhancing the quality of life for all in our community.

Northern New Mexico Connect is the principal economic development investment of Los Alamos National Security LLC and Los Alamos National Laboratory. NNMC’s collection of coaching, networking, research, technical assistance and investment activities helps businesses reach the next level of success and create an entrepreneurial culture in northern New Mexico.

MIX
is a casual, monthly networking event that occurs on the third Thursday of each month. MIX routinely launches micro-stimulus projects aimed at crowd-sourced ideas and bootstrap entrepreneurs.

The Coronado Ventures Forum educates investors and entrepreneurs on the process of early stage, private equity funding and provides a gathering point for these two communities to come together and network.

Ignite New Mexico is an ongoing series of high-energy evenings made up of 5-minute presentations by people who have ideas—and the guts to get on stage and share them with their hometown crowd.

Springboard is a program of Northern New Mexico Connect that provides expert coaching for companies facing strategic decisions such as securing funding, verifying business models, building management teams or penetrating new markets.

 

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