“An entrepreneur without funding is a musician without an instrument.” — Robert A. Rice Jr., author
- Bringing funding to the Midwest
- Podcast: What do investors get excited about?
- Arch Grants Startup Competition
- Introducing Bolt
- Soft robots
- Large-scale 3D printing
- Data and farming
- Want to find a Midwest unicorn?
- Fueling the Future
- Name that Flyover City!
April 15, 2021
Lewis & Clark Ventures brings funding to the Midwest
Brian Hopcraft, Lewis & Clark Ventures
Lewis & Clark Ventures is an early stage venture firm managed by former founders and operators. They invest in late seed through Series B companies between the coasts. We spoke with Brian Hopcraft, General Partner at Lewis & Clark.
Tell us about the fund.
Hopcraft: We founded the fund with the thesis that there wasn’t enough capital available in the middle of the country. At the very early stages of a startup, you raise money from friends and family to get you started. You might also get $500,000 to a million dollars in seed money. Where we invest is after that stage. We like to see companies that have customers and maybe $100,000 of revenue. That’s where we want to invest.
That’s where we always saw the need for a bigger check size, a bigger amount of investment and we knew we could have the biggest impact in the middle of the country. There are plenty of great companies here—ideas don’t just happen on the coasts—and there are great entrepreneurs taking chances. We wanted to be the funding source for companies at that stage.
What other factors led you to focus on the Midwest?
Hopcraft: I’ve spent my entire career in the middle of the country in software companies so I know that there are great ideas here that are overlooked by coastal ventures. Over 80% of the venture capital in the U.S. is all on the coast. So there’s less competition here in the middle of the country.
What can you tell us about your portfolio?
Hopcraft: We’re in our first fund, moving to our second fund. In our first fund, we invested in 14 companies. Everywhere from Chicago to Salt Lake City to Columbus to Indy. The company in Indianapolis is called Springbuk. It’s a healthcare data analytics company and it’s a great story: an entrepreneur had some background in the space and started a software company. They were probably 12 or 15 people, with some revenue and customers. We backed them with an investment. We’ve worked with them closely and they’ve grown significantly since then. That’s our model of what we want to do.
"I’ve spent my entire career in the middle of the country in software companies so I know that there are great ideas here that are overlooked by coastal ventures."
— Brian Hopcraft, Lewis & Clark Ventures
I’ve been an entrepreneur myself and I know that in those early stages it’s hectic but it’s also fun. I love working with those entrepreneurs. Being an advisor and mentor to help them grow the foundation of a company. Having a company of ten people is much different than having 100 people. When you have ten people, the CEO is probably the chief salesperson, the market lead and running the HR department. With a 100-person company, you have a dedicated marketing person, a dedicated sales lead, etc.
How do you find startups?
Hopcraft: Pre-COVID we used to spend a lot of times in different cities in the middle of the country. We’d meet good entrepreneurs who knew others. Entrepreneurs always want to talk to a company that wants to invest. Lately we’ve looked a lot online for companies that have already made that first seed round. The process involves a lot of networking, a lot of building relationships with anyone from attorneys to the seed fund investors to universities and their programs. You start getting into that world and it gets easier to find companies.
Other than funding stage, what criteria do you look for?
Hopcraft: We always look at the founders. Since the companies are so early, we’re backing an idea. So when we find a great leader, that gets our attention.
What do investors get excited about?
Need to better understand what investors look for in a startup? Want to know more about their growth strategy? These are must-listen to episodes of the Fast Frontiers podcast. Host Tim Schigel, Managing Partner of Refinery Ventures, brings you interviews from leading investors and venture capital firms.
Investing in unexpected places — S2:E2
There is more innovation happening in the Midwest than you think. Get insight on the region and access to capital from M25 founder and partner Victor Gutwein. CBInsights recently identified M25 as the most active investor in Illinois, Michigan, AND NEBRASKA.
Jon Medved is a serial entrepreneur and leading high-tech venture capitalist. As founder and CEO of OurCrowd, the world's largest equity crowdfunding platform for accredited investors, he has empowered over 170 companies to raise more than $1 billion since its launch in February of 2013. Hear his story and what criteria he looks for in a startup.
Disagree and commit — S2:E7
Disagree and commit is a concept made famous by Jeff Bezos. It's something that's used often among partners in venture firms. Not everybody agrees with an investment idea, but once the investment's made, everybody is pulling in the same direction. Mackey Craven, investor and Forbes 30 under 30 alumnus, explains how this is put into practice to achieve success.
Arch Grants Startup Competition
The Arch Grants Startup Competition is open for applications. Through their annual Startup Competition, they award $50,000 non-dilutive grants (and $10,000 non-dilutive support for relocation expenses for companies relocating from outside of MO), and provide professional support services to early-stage companies that locate their business to St. Louis for at least one year. In addition, all Arch Grants Companies are eligible to receive up to $100K in additional non-dilutive funding as they grow and scale. Visit their website to apply.
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Want to find a Midwest unicorn?
Co-hosted by InvestMidwest and MGCS, the Midwest Venture Showcase will not only highlight high-growth Midwestern companies, but also include panels like “Why Invest in the Midwest,” “Diversity & Inclusion in Investing,” and “Midwest Unicorns Are Real” as well as informative topics like “Venture Debt 101.”
What is fueling Flyover Country innovation? In this weekly feature, we share a variety of announcements covering funding, acquisitions, exits, grants, and everything in between. Got something to celebrate? Click here to share your story.
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Business starts in Minnesota are up 30%, with over 30,000 businesses having started recently. The state also received $1.86 billion in venture capital investments in 2020, ranking it 12th in the United States and second in the Midwest..
It's time for our favorite trivia game!
Here are this week's questions:
- Where in Flyover Country was water skiing invented?
- It has been described as one of the finest examples of Neo-Gothic architecture in the United States. What is the Scottish Rite Cathedral and in what city is it located?
- The university in this city has as its sports mascot a Bluetick Coonhound named Smokey.
Click here for today's answers.
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