BrightStar Wisconsin Foundation’s annual report shows the group invested nearly $5.9 million in 2017.
This nonprofit foundation accepts donations and uses the funds to invest in early-stage companies, with a goal of creating more tech-related jobs in Wisconsin.
At the end of 2017, BrightStar had over $7.8 million in assets with just over $34,000 in cash on hand.
About 40 donors have contributed $8.8 million to the foundation in the past four years. Each contribution ranges from $100,000 to $1 million, and pledges are accepted for up to five years.
“As we enter our fifth year of investing, we expect to see exits for some of our earlier class of companies and thus returns for the portfolio,” said BrightStar’s president and CEO, Tom Shannon.
The report notes portfolio companies making progress last year: Shine Medical, a radioisotope production company breaking ground on its first Janesville building; and Dairyvative, a dairy processing technology business opening up a new production facility in Sheboygan.
In all, BrightStar portfolio companies raised more than $43 million in capital last year. The foundation estimates its investments have led to 481 jobs being created.
BrightStar’s 2017 portfolio companies include:
*Errand Solutions, a Land O’ Lakes business with an employee engagement tool based on errand-running and concierge services.
*Ideawake, a Milwaukee startup also working in the employee engagement space, using cloud sourcing to drive innovation.
*Exit7C, a Milwaukee company providing a mobile app for fleet drivers, used to pay for fuel and other expenses.
*Lumanu, another Milwaukee business that brings together creative influencers and strategic advertising to help companies create more engaging content.
*HuTerra, a De Pere startup with a platform to help nonprofits raise money for charity while streamlining the process of giving.
*SimpleMachines, a Madison business that has invented a new computer processor that improves the process of designing other customizable computer components.
The report highlights successes of these companies, but also shows some hiccups in 2017 as two portfolio companies shut down.
FloraSeq, which ceased operations in December, was founded by two PhDs who spent two years trying to develop a new medicine for gastrointestinal diseases. Though they had received public attention and several innovation awards, a competitor was able to “jeopardize FloraSeq’s anticipated head start on the market.”
Beekeeper Data, which shut down in August, was a software company with a platform for communicating business metrics. Founders had clients using it in a pilot program, but were unable to convert paying customers.
Since the company’s small customers used open source alternatives and larger customers bought bigger packages from national competitors, “the team could not crack the medium-sized client opportunity.”
“There will be more failures, and it is important for investors and entrepreneurs to not only learn from what went wrong but also accept that in the early stage space, even perfect execution on a plan can still come up short if the planets don’t align correctly for the opportunity,” report authors said.
See the full report here: http://www.brightstarwi.org/sites/brightstarwi.org/files/images/BrightStar%202017%20Annual%20Report.pdf
–By Alex Moe