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Lakeshore seed fund closes three more deals
7/31/2008
by Mark Sanchez | Business Review Western Michigan Thursday July 31, 2008, 8:00 AM
"We have a good number of entrepreneurs out there that have really good ideas," says Randy Thelen, head of Lakeshore Advantage. He's designing and producing "lifestyle electronics" that use Bluetooth technology.
His introductory products are wireless audio transmitters that allow you to send and receive high-quality audio through any multimedia device, as well as a Bluetooth-enabled speaker system.
Those and future products are made for "anywhere it makes good sense to get rid of a cable," said Jeremy Kovacs, founder, owner and president of Miccus Inc. in Zeeland.
"Really, our main competitor is the cable," said Kovacs, whose company was one of three recent recipients of loans from the $1 million Lakeshore Advantage Seed Capital Fund.
The loan will help Miccus cover the cost to develop and market new products, Kovacs said. The emergence of "smart phones," such as Apple Computer Inc.'s iPhone, will drive the market for his products, Kovacs said.
"As that trend progresses, you're going to see a typical MP3 player go away. 'I have a smart phone, and it has everything I need it to do,'" he said.
Also receiving loans from the Seed Capital Fund were Keglove -- which makes and sells insulation sleeves for beer kegs and beverage dispensers -- and Crayon Interface, a developer of software that enables cell phones, PDAs and other mobile devices to connect to equipment and information in a vehicle, home or business.
The three businesses collectively received $225,000, Lakeshore Advantage President Randy Thelen said.
Working with a group of private investors, the economic development organization formed the Seed Capital Fund to provide start-up capital for new businesses.
Offering loans of up to $100,000, the fund seeks to financially position entrepreneurs to where they can validate their innovations, raise additional capital from venture capital funds or angel investors, and eventually move into the marketplace.
Investments by the seed fund come via loans that investors can convert into equity positions once a start-up company builds valuation.
Focusing on companies in the electronics, consumer and "green" product markets, which have a shorter product development window, the fund may do another three deals by the end of the year, Thelen said.
"We're continuing to see good interest," he said. "We have a good number of entrepreneurs out there that have really good ideas."
The fund closed on its first investment in November 2007 to Creative Byline, a Holland company developing software for publishers to review manuscripts. The fund invested in Creative Byline with Grand Angels, a Holland-based angel network.
The seed fund's areas of focus play well on the strengths of the region and its strong capabilities in design and engineering.
"We have the talent here and the people with ideas," Thelen said. "Now we have the resources."
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