Welcome to the Texas Coalition for Capital's special edition e-newsletter. We are a non-profit, statewide coalition of leaders supporting economic development and job creation through long-term access to capital for Texas entrepreneurs and emerging companies.

In each newsletter, we highlight Texas' dynamic investment infrastructure, recent investments, and the spectrum of funding sources available to our small businesses. Texans are innovators, and the infrastructure we are seeing come to fruition - connecting companies and capital - is no exception.

We are a resource for promising young companies, entrepreneurs, investors, economic developers, universities, and other stakeholders in the deal flow chain. The Texas Coalition for Capital hopes to work with you to keep Texas the most vibrant business climate in the country.

With best regards,

Craig Casselberry, President
Texas Coalition for Capital



Events

Texas Rural Challenge 2010
Set for May 24 & 25
"Building the Competitiveness of Texas Rural Communities"

The Texas Rural Challenge Conference is a state-wide rural focused event that will provide rural leaders with tools for funding in these critical times, creating jobs and improving quality of life in rural communities.

The goal of this conference is to spur business and economic growth in rural communities across Texas by providing leaders with practical and proven approaches to rural development.

Experts will be paired with successful everyday practitioners. Attendees will benefit from the input of other rural leaders that have successfully used the tools presented to overcome rural challenges.

Invited Keynote Speakers: Al Salgado, Southwest Border Network; Liz Sumter, Hays County Judge; Donna Gambrell, Director, U.S. Treasury; Todd Staples, Texas Agriculture Commissioner; Denise Trauth, President, Texas State University; Judy Canales, United States Department of Agriculture-Rural Development; Brian Dabson, Rural Policy Research Institute

Panel Sessions: Community Planning Tools, Community Research Tools, Infrastructure Planning & Development, Capacity Building, Creating New Markets for Small Businesses, Community Entrepreneurial Readiness, Regional Approach to Rural Economic Development, Success Stories for Community Projects and Entrepreneurs

For more information or to register click here.

 



Welcome New Coalition Members!

Rebecca Arterbury / Eric Fox - Lockheed Martin

 

Jason Black - Boundless Network

 

Michael Dwyer - Azaya Therapeutics

 

Carrie Fox - Principal Financial Group

 

Matheson Law Partners

 

Jim Poage - SATAI Network



Advisory Board

Chairman, Tom Kowalski
Texas Healthcare & Bioscience Institute
President, Craig Casselberry
Quorum Public Affairs
Dan Matheson
Matheson Law Partners
Jeff Clark
Tech America
Larry Peterson
Texas Lyceum
Pike Powers
Fulbright & Jaworski
Damon Rawie
Advantage Capital Partners
Steven Anderson
West Texas Coalition for Innovation Commercialization
James Arie, Ph.D.
University ot Texas Medical Branch-Galveston
Curt Bilby
Terapio LLC
Susan Davenport
Greater Austin Chamber of Commerce/Central Texas RCIC
Guy Diedrich
Texas A&M University
York Duncan
Texas Research Park Foundation
Michael Dwyer
Azaya Therapeutics Inc.
Sloan Foster
Digital Convergence Initiative
Eric Fox
Lockheed Martin
Fernando Gonzalez
Rio Grande Valley Regional CIC
Neal Iscoe, Ph.D.
University of Texas-Office of Technology Commercialization
Martin Lindenberg
AlphaDEV LLP
Mike Lockerd
North Texas Regional CIC
Andrew Nat
Texas Life Science Regional Center of Innovation
Beto Pallares
El Paso/Trans-Pecos Regional CIC
Jim Poage
Satai Network/South Texas Regional CIC
Brian Hermann
University of Texas Health Science Center San Antonio
Bob Prochnow
Gulf Coast Regional CIC
Terry Schpok
Akin Gump Strauss Hauer & Feld, LLP
Brent Sorrells
TECH Fort Worth
Dennis K. Stone, M.D.
University of Texas Southwestern Medical Center
Mark Ellison
Texas A&M University
Sara Patuel
The University of Texas/TechBA Program
Jacqueline Northcut
BioHouston

Two Companies Benefit from Public-Private Investment
Texas CAPCO Program Fuels Company Growth


Schools getting 'WhiteGlove' health care service
 BY TAMARIND PHINISEE, San Antonio Business Journal
 
School districts around the city are opting for an alternative health care service that is quickly gaining popularity.

This service, provided through Austin-based routine medical provider WhiteGlove House Call Health, essentially brings the doctor's office to the school district employees.

Employees are visited on-site by a nurse practitioner who takes vital signs and performs a complete check up on the ailing patient.

The nurse practitioner also brings generic prescription medications, foods, beverages, and over-the-counter medications, which are furnished to the patient.

Employees simply pay a $35 co-pay and everything provided during the visit, including prescription meds, is included.

An annual membership fee of between $300 and $400 per employee is covered by the school district's insurer, when the service is first used by the employee.
 
The three insurers partnering with WhiteGlove to provide this service are: Humana, Aetna and United Healthcare.

This service is available to employees 365 days a year between 8 a.m. and 8 p.m. - at work or at home.

The idea is that employees miss less school, districts pay less money for substitute teachers and shave costs off of health insurance.

 To read more click here.

 

Uvalde-based Sierra Industries creates new division
BY JANICE WOOD, GA News
 

Sierra Industries has created a new division, SkyWay Aerospace Technologies, after signing a multi-year contract with a major aircraft original equipment manufacturer (OEM) for a joint aerospace technology development program.

While non-disclosure agreements prevent specific company identification, Sierra officials said, the program will involve the development and manufacture of multiple new product offerings in aviation. Program Manager Bobby Smith will oversee the new company. Smith is a retired Air Force Colonel and fighter pilot with an Airline Transport Pilot, civilian flight instructor, instrument, and multi-engine instructor ratings. He has over 6,000 flight hours, including Cessna Citation 500 series business jets and test pilot experience.

SkyWay Group President and Sierra CEO Mark Huffstutler remarked, "Despite the challenging business environment in today's business aviation industry, Sierra continues to seek new opportunities for growing our customer base and our workforce. The creation of this new division and winning of long-term technology development contracts are integral to that goal."

Sierra Industries has specialized in Citation aircraft for over 25 years and is a leader in Citation Performance Enhancement Modifications, currently holding more than 75 proprietary Citation modifications and products - which covers only a part of the company's more than 300 FAA supplemental type certificates (STC). 



In a Cash Crunch? Work With Your Vendors
Paying your bills late and stretching your payables could yield increased cash flow.

BY GEORGE CLOUTIER, entrepreneur.com
 
You're in business to make real money for you, your family and your employees. At least I hope you are. If your goal isn't to pile up personal wealth, you will probably fail. If you care about doing something good, give a portion of your profits to charity--just be sure to make profits first.

Over the last two years, most small-business owners have exhausted both their personal net worth and that of their businesses. They've borrowed where they can on household equity, emptied their 401(k)s and family savings accounts, have drastically reduced their compensation, and some are even facing foreclosure. Bank lending and other commercial financing sources have shriveled. In fact, for most small businesses, every day is hand-to-hand combat for cash flow. Sometimes if your situation is dire, you may have to sacrifice profits for cash.

One of the last sources of cash for your business is your vendors. One major distributor recently announced it paid down $1.9 billion in debt by drastically extending its payment terms with vendors. The corporation went from net-30 to net-60 days--in some cases, net-never--after sale. Why can't you do the same on a smaller scale? Whenever you negotiate additional time to pay, you have created an interest-free permanent loan for yourself.

Whether you have $5,000, $50,000 or $100,000 in payables, extending those payables 30 days is free cash. Would you rather ease your cash flow problems or be warm and fuzzy with your vendors? It's your choice.

If your terms are 30 days, see if you can get 60, and in another three months try for 90. Negotiate honestly with your vendors; be upfront about why you need extra terms and that you need their help. About 90 percent will respond favorably. If you absolutely need a vendor, let him win. In most cases, you can find other sources that will go the extra mile for you; they are your real friends.

To read more click here.

 

Entrepreneurs Find Success With Specialty Lenders
Some Banks Cater to Niche Areas, Such as Veterinarians, Life Sciences, but Too Much Concentration Can Carry Risks
BY EMILY MALTBY, The Wall Street Journal
 
...Business owners who approach specialty lenders have an advantage. The loan officer already knows the revenue potential, financing and cash-flow needs of that industry, particularly in the context of the broader economy, and can advise with keen awareness of any snags in the business plan.

When Motion Computing Inc., an Austin, Texas, manufacturer of tablet computers, needed a revolving line of credit, the managers heeded the advice of their investors and approached Silicon Valley Bank, based in Santa Clara, Calif. The bank specializes in catering to high-growth technology and life sciences firms. "They totally understood our market so we could have good strategic conversations about the growth plan," says Cathy Thompson, Motion Computing's chief operating officer. The company secured a line of credit. Ms. Thompson declined to say the amount.

Loan officers at specialty banks often have a sharp eye for mismanagement and are judicious about loans they issue. That selectivity is a necessity, as regulators often scrutinize banks that carry too much weight in one or two industries.
 
Specialized lenders are considered risky, especially in light of the financial fallout that resulted from a too-high concentration of loans in the real-estate market, says Mark Schmidt, a 33-year veteran with the Federal Deposit Insurance Corporation's Atlanta office who now advises financial-services companies at consulting firm Promontory Financial Group LLC.
Mr. Schmidt adds that existing banks are "not prohibited from identifying and moving in to a niche model," but they may be subject to more scrutiny from regulators if the niche appears risky.

To read more click here.

 

Syndiant Receives $3.5 Million Investment from Texas Emerging Technology Fund; Recruiting to Fill New Jobs
 
Syndiant, enabling consumers to enjoy a large screen experience in handheld electronics, received a Technology Commercialization Award of $3.5 million from the Texas Emerging Technology Fund (TETF). The funding will be used to advance the production of Syndiant's VueG8 ("ViewGate") display products for embedded pico projectors, as well as add engineering staff to its Texas-based headquarters.
 
"We are pleased to be chosen as a recipient of the Emerging Technology Fund and believe this is strong endorsement of our technology, which offers consumers significant advancement in display technology for embedded pico projectors," said Mark Harward, CEO of Syndiant. "The funding will expedite the commercialization of our technology, accelerate the market acceptance of next-generation, embedded pico projectors and enable us to create job opportunities at Syndiant."
 
The first funding tranche (out of two) will enable Syndiant to hire six additional engineers, expand its U.S. and International patent filing activity, and engage with the Center for Integrated Circuits and the Materials Science Department at the University of Texas at Dallas.
 
North Texas Regional Center for Innovation and Commercialization (NTXRCIC) Director, Mike Lockerd, who is responsible for assisting companies with the Emerging Technology Fund application process stated, "The selection committee gives priority to companies with technology that will disrupt the marketplace. We believe Syndiant has the ability to do this and, by providing resources and capital to help bring their technology to market, we are helping Texas maintain a strong position in our highly competitive global economy."
 
To read more click here.

 

How to Win Angel Funding
BY COLEEN DEBAISE, The Wall Street Journal


If you're looking for a cash infusion for your high-growth company, angel financing might be for you. (See related story, "What's an Angel Investor?")

I asked Susan Preston, author of Angel Financing for Entrepreneurs and an angel herself, to explain what an angel wants to see before making an investment. Here's her list:
 
· A solid potential for return. Angels want to know how your company will make money, when it will turn profitable, and when they can expect a return on their investment. You'll need to back up those promises of profitability with financial documents that include an income statement (also referred to as a profit/loss statement), a balance sheet and cash flow statements.

· A good plan for the cash. Investors want to make sure their money will be spent wisely. If you've founded, say, a consumer product company, you'll need to show how the money will be used to design, develop and distribute your product. And emphasize your thriftiness: angels don't want to see the money being used for big salaries or fancy office space.

· A winning attitude. Get fired up. Angels want to see passion; they want to see you're committed to your concept and company and that you'll stay the course when obstacles arise. Aside from enthusiasm, you must be able to clearly articulate your company's mission-and how you'll make that dream a reality.

· A seasoned team. Angels want to see a strong management team that's capable, experienced in their industry and, more important, open to suggestions and opinions. "If I don't think that a CEO or founder is coachable, I won't invest," Preston says. "Someone who comes in and says 'I know all the answers' is the kind of person who is doomed to failure."

· A competitive edge. How are customers responding to your product or service? An angel will want to know that you can capture market share quickly and beat out competitors as you ramp up. If your product or service is fairly unique, an angel will want to see you've secured the patents, copyrights or trademarks to protect your intellectual property.

· A well-defined exit strategy. Investors will want to know exactly how you plan to make them money-and just saying "IPO" or "acquisition" might not be enough. Research how other companies in your industry have returned profits to investors. Identify potential suitors for your business. "It's a homework point that they need to have done," Preston says.