By Ken Staut
A friend of mine once asked me if I am motivated out of fear of failure or a drive to succeed. My answer clearly depicts why I’ve been a moderately successful entrepreneur, and why I’m not really cut out to be a cog within a massive organization: I am not afraid of failure. I only do things because the challenge is interesting to me. I spent a decade of my life analyzing risk and reward for a living; I don’t misunderstand the risk of being an entrepreneur. In fact, I perversely seek it out, as do many of you. I deeply feel, from my inner-being, that if I went my whole life without taking a real chance, I would be vastly unfulfilled.
Luckily for me, I’ve now checked off that “fulfilled” box several times. The first was out of necessity and the second because of an extraordinary passion.
In 2009, I co-founded Tiburon Capital Management, an event-driven hedge fund. It was clear to me that the time period presented an investment opportunity of a life time. The problem was that the finance world was busy crumbling around us. Thus, the only way to capitalize, was to start our own shop. Luckily, we were incredibly ignorant and naïve; if we would have had any idea how difficult it would be to raise money and start a hedge fund in 2009, we never would have started one!
To quote one of my role models in the finance industry, we pulled a Howard Marks-ism. “Of all the alternative histories that could have occurred, ours that led to some modest success was the least likely.” But alas, Tiburon Capital Management raised over $50 million, outperformed our peers and benchmarks and were acquired by a pension endowment advisor. It was on that very day that I started GrowthFountain.
GrowthFountain, of course, is the startup created out of passion. I immediately knew that creating it was inevitable after reading the JOBS Act for three reasons. First, I had ten wonderful years of experience in finance. I knew I could utilize that knowledge I gained in a way that would add immediate value to America’s small businesses and entrepreneurs, helping them grow and succeed. Second, I suspected that it would be easy to rally people around our mission because of the warm, fuzzy, feel-good and altruistic nature of our business: to minimize friction and level the playing field for America’s small businesses and entrepreneurs. I suspected those we could rally would become valuable team members, partners and supporters. It’s like the old saying, “If you hire someone because you can pay him, he’ll work for a salary. But if you hire someone because he believes what you believe, he’ll work for you with blood, sweat and tears.” And finally, it was easy for me to see that this presented a truly massive opportunity. The JOBS Act would completely and forever revolutionize the fundraising landscape for America’s small businesses and entrepreneurs.
Let me explain the opportunity we’re pursuing. Walk down Main Street in any town across America and notice all the businesses you pass. They are almost all local businesses. Small businesses comprise half of our economy and more than 60% of new job growth, but we take for granted how they come to exist. We don’t put much thought into how they went about raising the money they needed to launch, or what pre-existing relationships with “accredited” investors they just happened to have. Securities law is rigid and unforgiving, and made it almost impossible for any small business to raise the money they so dearly need – that is, until now. The JOBS Act, which was born out of the Great Recession of ’08 – ‘09, turned 80 years of securities law on its head, and now makes it easier for companies to turn customers, community members and extended networks into owners, who can then become brand ambassadors, helping them growth their business. GrowthFountain is simply a platform that can help businesses and entrepreneurs across the country simplify the process of raising money and help connect them to potential investors. You should come take a look.
