Funds until money rolls in

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This article was published 19/11/2014 (3455 days ago), so information in it may no longer be current.

A new funding organization has been launched in Winnipeg with lofty ambitions — to help startups navigate their way through the Valley of Death.

That’s the term used in the startup world to describe the period between the launch of a product and the time regular revenue starts rolling in.

The CatchFire Group is a partnership of five individuals, including Sean Burns from VA Angels, Stu Henrickson from the Asper School of Business and the Stu Clark Centre for Entrepreneurship and Gary Brownstone, CEO of the Eureka Project.

Burns said CatchFire closed its initial round of financing, raising an undisclosed amount and will launch a second round this month.

It will make investments in companies of between $25,000 and $100,000 and CatchFire will take a small, single-digit percentage of the equity of the firm.

Burns said the cash investments in the companies CatchFire supports is not the most important part.

“We typically find that $25,000 to $100,000 is sufficient to marry that with the management expertise to get them to be where they need to be,” Burns said.

The fund announced the first two Winnipeg companies it will support today — Koronis Health Inc. and Quipped: Interactive Learning Tools Inc.

Suzanne Braun, president of Quipped said it’s the access to the expertise that CatchFire brings that is most enticing.

“What we’re doing is challenging and we have to move quickly,” Braun said. “It’s great to have high-level access to investors or international sales assistance or help in organizing how we are selling… to have them involved and to be able to pull from such a diverse collection of talent will be beneficial to us.”

Brownstone believes this is the first undertaking of its type in Manitoba that provides some cash — and access to additional funders — as well as professional management.

He said the incubators, such as Eureka Project will say their work is done when a new company successfully commercializes its product or service and makes is first sale.

“But what happens at that point is their access to money and support talent evaporates almost immediately,” Brownstone said. “They become too grown up for government assistance and not yet grow up enough to attract private investment. We created CatchFire to fill that gap.”

Quipped is an educational-technology company that has developed software to help teachers create a better assessment and learning plans.

Koronis Health specializes in health and medical software communications innovations. It’s founder, Dr. Ali Esmail, is a head and neck surgeon who took a break from his residency at the Health Sciences Centre to do a master’s degree in business, entrepreneurship and technology at the University of Waterloo.

That’s where he started to formalize the idea to develop software for a secure mobile-communications platform for health-care professionals to share information about patients.

martin.cash@freepress.mb.ca