Sheltowee’s newest fund makes 10 investments
The regional angel network is making big moves investing in technology start-ups. Knoxville start-up Ascend Manufacturing is one of those latest investments.
In early September, we posted this article about the Sheltowee Angel Network’s plans to launch Sheltowee Venture Fund II with a goal of raising $25 million to invest in technology start-ups in America’s heartland.
Now comes word that the fund has had its first close at $1 million and has made investments in 10 companies – EMBolic Acceleration and Sense Neuro Diagnostics, Ascend Manufacturing (a Knoxville company), Ohsnap, Photonicare, Anavah Health, XRMedix, CareHealth, Endo Technologies, and Magsorbeo Biomedical.
The first start-up is based in Miramar, FL and focused on serving the needs of interventionalist radiologists, while the latter company, headquartered in Norwood, OH, is developing non-invasive technology that enables rapid, comprehensive detection of traumatic brain injuries, bleeds and strokes. Ascend Manufacturing, an alum of the “Innovation Crossroads” program at Oak Ridge National Laboratory, is an advanced 3D printing company that can expand throughput by 500x for additive manufacturing.
The others are:
- Ohsnap, a mobile accessory company;
- Photonicare which is setting a new standard of care for diagnosing inner-ear infections;
- XRMedix that is changing the way individuals visualize surgery;
- CareHealth is a provider of data-driven diabetes management;
- Endo Technologies has developed a new endoscopic cleaning process and technology; and
- Magsorbeo has developed resorbable materials for implants and maxillofacial fixation and plates.
All fit within the broad categories that Eric Dobson, Chief Executive Officer (CEO) of the Sheltowee Angel Network, told us. The fund focuses on companies specifically in three industry sectors – materials, technology, and medical devices.
“We were able to put money in the last eight companies in December,” Dobson says, adding we expect to aggressively invest capital in 2023.
The newest fund is part of the Sheltowee Network, a family of entities that complementary services. It includes the:
- Sheltowee Foundation, a 501(c)(3) that supports entrepreneurial education as well as entrepreneurial ecosystem building through investor education;
- Sheltowee Business Network that helps entrepreneurs raise capital through mentoring and other advisory services;
- Sheltowee Angel Network that has three chapters – Marble City Angels (Knoxville), Music City Angels (Nashville), and Derby City Angels (Louisville, KY) – that helps vet and seed earlier stage deals that would be of later interest to the venture fund; and
- Sheltowee Venture Fund II.
In a video for prospective investors, Alex Day, CEO of the Sheltowee Business Network, noted that Dobson, Day and their third partner – Marc King, CEO of Allura Medical Holdings – started out as entrepreneurs and have sat on both the founder and investor side of the table.
He described the Heartland as the geographically encompassing the Appalachian region and states that border it.
“We offer a vertically integrated solution,” Day said, explaining that Sheltowee brings not only capital but also mentoring and education to its portfolio companies. “We invest in areas where we have domain expertise.”
The ideal candidates for investment consideration are start-ups with valuations of $2.5 to $20 million who are seeking check sizes of between $50,000 to $1 million. They should be tech-enabled and have: (1) at least a Beta prototype; (2) a time to market of two years or less; (3) minimum topline revenue of $15 million in five years; and (4) low market adoption risk.
Dobson added that are still opportunities for potential investors before the Fund II closes.