Ingram's Magazine July 2022

community that often runs into that funding wall. “From personal experience and what I see with my fellow entrepre neurs, angel investment is just real ly low,” Flynn said. “We need angels coming in earlier rather than waiting so long in the companies’ journey that companies die before they get there.” Citing research by startupusa.org, which tracks the flow of investor capi tal, Flynn noted that Kansas City’s lev el of early-stage investment per capita

to needed capital to launch and grow their businesses.” First-time employers have created an average of almost 20,000 jobs per year in Kansas from 2014-2018, total ing over 94,000 new jobs, Shackelford noted. “That represents 50 percent of all new jobs during that period. Im proving access to capital for all found ers across the state could significantly increase new business starts and jobs created every year across Kansas.” Early-stage ventures, all agreed,

enough to benefit beyond their needs —if you want a thriving ecosystem, pick a company and write a check... every year. Drive Capital at Columbus was a game-changer for them.” There is, however, a $1.2 billion joker in the deck that might play to the region’s advantage in attracting coast al capital and attention: The National Bio and Agro-Defense Facility, open ing in phases later this year and into 2023. “NBAF will help protect America from foreign animal disease threats by developing new vaccines, anti-virals, and other countermeasures, while cre ating improved diagnostics as well,” said Ron Trewyn vice president for research emeritus at Kansas State Uni versity, adjacent to the NBAF site. “USDA will own and operate the facility and they plan to work with the private sector to get the new technolo gies to market,” Trewyn said. “NBAF was obviously a determining factor in Scorpion Biological Services decid ing to build a massive new biomanu facturing facility in Manhattan, and increased interest by venture capital firms is certainly on the horizon.” The Silicon Valley venture firm Plug and Play, Trewyn noted, already has a growing presence in Topeka and that’s likely only the beginning. “With the great work being done by the Kan sas City Area Development Council and others, there are exciting times ahead for the Animal Health Corridor and beyond,” he said. That would be fine by Gupta. Even though a number of universi ties have reached out to ask about align ing with his work, he says, “I still see people not very open-minded. I don’t mean in a bad way, they are all very accomplished people, but many times, they get stuck, and rather than looking at the potential, they look at whether the tech is proven by somebody else, or if that founder had a previous exit. “I had never raised money before, had no record of making a company big through venture capital. Those are the things, I’m asking investors, some times you need to take the gamble and say this person has a tremendous background in that tech and this could be game-changing tech. That’s what’s missing here.”

“We need angels coming in earlier rather than wait ing so long in the companies’ journey that companies die before they get there.”

— MARIA FLYNN, FORMER CEO, ORBIS BIOSCIENCES/TECHSTARS

“is just way down the list. We aren’t showing up among our peer cities. If you look at cities that have made great strides over the last 15 years like Boul der, Austin, Columbus and what they have done … there is no reason Kansas City shouldn’t be on that list.” That’s not to say we’re a VC basket case. Things we do well in KC’s funding ecosystem: “We’re getting investors here who are really respectable,” Flynn said. “They are getting good results and they deeply care about our community. People like Darcy Howe with KC Rise, Dan Kerr with Flyover, Jeremy Tasset with Neuterra Capital. There are cer tainly later-stage players here like Five Elms Capital, and if you go to the Asso ciation for Corporate Growth, you see where the funds are for later stage. But the early stage is really a drought.” Jeff Shackelford, CEO of the Enter prise Center of Johnson County, views the challenges through the prism of Kansas companies, but situation there isn’t markedly different. “While access to capital for new and early-stage ventures in Kansas is improving, there are still significant gaps in the state’s early-stage funding ecosystem,” he says. “Entrepreneurs of color, female founders and entre preneurs living in rural communities continue to struggle to find access

need capital to launch and grow quick ly. As Shackelford noted, “access to seed capital for early-stage ventures is extremely limited and often de pendent on founders having wealthy friends and family, or “inside connec tions” to wealthy investors or invest ment firms. … It is essential we find sustainable ways to make early-stage capital accessible to all entrepreneurs across the state.” Surrounding states, he noted, in cluding Missouri, “all have state-fund ed, early-stage funds dedicated to growing new enterprises throughout their respective states. These public/ private partnerships provide a 1:1 state match of private capital at a critical juncture for new ventures and have shown great success.” Flynn said there remains a need to focus on the early-stage companies, then ensure that investment is avail able across the growth spectrum. “Companies in the later stages have more options, which is why I champion focus on the earlier stages,” she says, “If you study how Techstars impacted Boulder, one of the phrases they had among their angel communi ty was if you want to have a thriving ecosystem, pick a company and write a check. I’m not talking about families who are worried about funding college or retirement accounts. The people who have been financially fortunate

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I n g r a m ’ s

July 2022

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