Wednesday, October 29, 2008

Interview with Alan Hall, Grow Utah Ventures

We recently spoke with Alan Hall, who is at Grow Utah Ventures (www.growutahventures.com), a nonprofit helping to promote entrepreneurship in Utah. Alan is also regional director of Enterpreneurship Week Utah (www.gewutah.com), a weeklong event running November 17th through the 23rd in Sandy, Utah focused on entrepreneurship and investment. We talked with Alan about the event, plus a little bit about what he's seeing in Utah's high tech market.

Tell us a little bit about what you're hoping to accomplish with Entrepreneurship Week Utah?

Alan Hall: Let me give you a bit of background on Entrepreneurship Week. There are a number of national and global organizations that are promoting Entrepreneurship Week, and we delighted when they contacted Grow Utah Ventures to help. We're a nonprofit in the State of Utah focused on stimulating and encouraging entrepreneurships. I became a regional director of this event specifically in Utah. We are going in with USTAR, Zions Bank, and a number of other sponsors with a week-long set of activities beginning on the 17th of November running until Friday the 21st, giving speeches all over the state about entrepreneurship. We're encouraging cities and towns, schools, chambers of commerce, and universities to celebrate entrepreneurship, and to encourage it, hold classes on its, and do everything we can do to carry out the functions of celebration and networking. It's a big thing across the State of Utah. On Thursday, the 20th, we'll also have a day-long event which will have an angel track for angel investors, with classes and seminars to educate angels on how to invest in good companies, a concurrent entrepreneur track to talk to entrepreneurs about term sheets, valuations, and moving their business forward, and opportunities for angels and entrepreneurs to get together in various settings. We're hoping to have about 600 people, a mix of angels, entrepreneurs, and suppliers of services to those people.

In the area of entrepreneurship, what are some of the things happening to encourage entrepreneurs?

Alan Hall: Our focus is on just getting more companies started, growing, and funded. Aside from celebrating this specifically in the 17th of November, we do things throughout the year. Our whole objective is to make sure we're helping people with ideas get commercialized, and find what they need in terms of finding funding and getting to the next stage.

Speaking of angel investments, what's the state of angel/venture investing in Utah, given the current public markets?

Alan Hall: A couple of years ago, there was just one angel group in Utah. Now, we're up to about nine angel groups. We've seen lots of growth. We're seeing that angel deals are still happening, because there's still lots of money out there, and obviously, people are looking on where to put their money rather than into the public markets. I'm finding that angels still have money, and are still investing in very good deals. They're cautious, but money is still being invested in companies--there's been no slowdown.

You also runs some incubators, don't you?

Alan Hall: We have three--one in Ogden, another in Kaysville, and another one in Logan at USU. They're beginning to fill with the companies we've funded, and we have our eye on two more, one in Provo and one in St. George.

What are the most interesting companies you've run across lately?

Alan Hall: We invest primarily in companies with a technology orientation, such as software applications, something on the web, and hardware devices. There really are some outstanding companies. I'll describe one-- 3Dvo. This is a company that is helping online retailers feature their products on the internet--not statically, in 2D, but in a three dimensional way. You can look at it, and open it up. The technology is out of Utah State University. They have customers like Skull Candy, Overstock.com, and Solomon, the ski people. They're growing out their market, and have a unique technology online.

Let's talk a about Mercato Partners - your venture firm-- where are things with the firm, are you making investments, etc?

Alan Hall: Actually, we're very pleased as we closed the fund last week, at $53M dollars. We have made two significant investments, one in Skull Candy, where we now own a large percentage of the firm, and another one is Mediconnect. We also have a third company, where we have just signed a term sheet, but I can't tell you the details publicly, which is a wonderful company. All three of them are in the Inc. 500 and are doing extremely well.

We raised money in an interesting way with the new fund, in a difficult time--we have a fund of funds that gave us money, and also JP Morgan came in and gave us a lot of money, but we capped the fund at $53M. I think, in terms of a startup venture firm in Utah, we've done better than anyone else.

The next question from entrepreneurs would of course be--what are you looking for in companies?

Alan Hall: We are looking for fast growing, large markets. For me, at the end of the day, is you have to have a product or service that takes care of lots of people. It has to be a very big market, but it also has to be a very compelling product that everyone needs. It's not something that you wish someone would buy, but something people really do have to buy. We are looking for those who will do really well, and grow fast.

Thanks for the time and the interview!