Alaska Angel Conference connects entrepreneurs with investors
Ana Kaiser and her co-founders Alexa Daniels and Jordan Bolton had their sights set on selling their keto/paleo/vegan donuts in the Lower 48.
They launched Fossil Fuel in 2018 after running a successful Kickstarter campaign, and quickly established a solid market base in Alaska. But to reach more customers who embraced the kind of lifestyle their products support, they knew they needed to grow into new markets, which required expertise and capital they didn’t have.
Kaiser had recently heard about a new funding opportunity, the Alaska Angel Conference, or AAC, and she and the team decided to give it a shot.
AAC is a collection of events designed to educate Alaska startup founders and new angel investors over the course of 12 weeks. Startups learn how to position themselves for investment and pitch their companies, while investors learn the ropes of angel investing (many are new to this level and type of investing), pooling their funds and making a group decision as to which participating company will receive their joint investment.
The term “conference” is a bit of a misnomer since the event spans several weeks where the investors conduct due diligence on each company participating, and while the companies simultaneously perfect their pitches, work on their business plans, and learn about tools of the fundraising trade like ‘term sheets.’
The decision to participate in angel investing — when an individual provides financial backing for small startups or entrepreneurs, typically in exchange for ownership equity in the company — is a serious one for both investors and entrepreneurs. Investors are putting dollars on the line in what is a traditionally very high-risk type of investment, and entrepreneurs are potentially giving away ownership in their company in return for receiving funding.
The conference supports both through the process, with the goal of increasing the number of investors in Alaska to spur entrepreneurial growth. Only one company is chosen at the end of the AAC to receive the pooled investment, which averages $100,000.
Previous AAC winners include Sitka-based Ramper Innovations, which developed a compact motorized folding conveyor system for baggage handlers, and Anchorage-based Pandere Shoes, a company making expandable footwear.
Gaining financial savvy...with funding at the end
Now in its third year, 2021 AAC organizer Mark Billingsley says that although the opportunity to secure funding is a driver for many entrepreneurs to participate, the true value is in the education and the network.
“There’s an incredible amount of access in the conference,” Bilingsley said. “If an entrepreneur wants to sit down with an investor, they’ll get that meeting. If they need help with something, they’ll get it. The mentorship opportunities alone, from people who are experts at building businesses, are immeasurable. There’s money at the end, but it’s more about growing your financial savvy for your business.”
Billingsley is the University of Alaska Fairbanks Director for the Office of Intellectual Property and Commercialization, as well as the UAF Center for Innovation, Commercialization, and Entrepreneurship and sees AAC as a foundation of the state’s entrepreneurial ecosystem.
“There are a couple ways to get a startup off the ground; bank loans and bootstrapping are great, but not always viable options, same with borrowing from family and friends,” Billingsley said. “That’s where angel investors come in; they provide that seed funding that can make a real difference for a company. Basically, the AAC helps investors get more savvy, connects them with startups looking for funding to grow, and in the process helps startups reach their goals.”
Billingsley is quick to say that AAC is not an Alaska version of Shark Tank, a notoriously cutthroat television show featuring investors and entrepreneurs looking for funding and sparring over dealmaking.
“This is a really friendly experience, and I think of it as more a tool for teaching,” he said. “Founders can spend as much time as they want debriefing on their pitches and will have someone walking them through what it means to seek and obtain funding. They’ll gain a network of investors, and receive a lot of really specific feedback on whatever they need, whether that's their financial documents, business model, pitch...whatever is most relevant to the company.”
Navigating funding options — especially the diverse and nebulous world of equity investment — can be challenging for entrepreneurs. Resources to help them negotiate, understand deal terms, and make the best decision for their company and themselves are key.
Although Ramper Innovations beat out Fossil Fuel for the overall conference investment in 2019, the company used the feedback from AAC to pitch other private investors and successfully obtained funding.
“We love to see ‘sidecar’ investments happening because of the conference,” Billingsley said. “It’s happened the last two years and I expect to see it again, especially with such a large pool of investors already signed up! People like to invest in industries they know, so even if a company isn’t the best fit for the overall investment, it might be a really exciting opportunity for one or two people on their own.”
Kaiser says that one of the best parts of AAC was learning how to do market research, knowledge that was essential as the company achieved their goal of expanding into other states. Currently, Fossil Fuel is in grocery stores in Alaska, Colorado, Montana, Utah, and Wyoming, with more to come. The company is currently negotiating with a fairly large supermarket chain.
From entrepreneur to investor to organizer
An unexpected benefit of AAC for Kaiser was finding a community she wanted to continue to be part of.
“Entrepreneurship is a solitary road, it’s nice to meet people going through similar things and swap ideas and knowledge with them,” she said.
That community is part of the reason she and her husband signed up to participate again in 2020, this time as angel investors.
“The world of starting a business is so interesting, you meet so many passionate people, and from participating in 2019 we realized that we just really wanted to invest in Alaska business. AAC seemed like the best way to get started, there is so much to understand, it’s like drinking water from a fire hose.”
Kaiser is participating again this year, this time as an organizer with Billingsley and others.
“Each time, the value for me is the learning...and I can’t wait to see what I learn this year!”
Alaskans interested in applying to the 2021 AAC — either as investors or on behalf of their companies — must do so by March 3. It is free to participate as an entrepreneur; investors must commit to making a $5,000 investment. Both entrepreneurs and investors should commit to spending 2 to 4 hours per week on the conference during the finals.
Gretchen Fauske is a marketing-minded economic developer fueled by a passion for innovation and entrepreneurship. She is the associate director for the University of Alaska Center for Economic Development, Board President for Launch Alaska, Vice Chair for Anchorage Downtown Partnership, and a Gallup-certified CliftonStrengths coach.