Fourth Edition: Startup Iowa Hot List
Meet the startups to support and watch in Iowa + beyond
Welcome to the fourth edition of the Startup Iowa Hot List, showcasing startups companies to support and watch in Iowa.
This monthly digest is to better connect Iowa-based startups (and affiliated) to the strong support networks in the Midwest investor and entrepreneurial ecosystem. Investors, entrepreneurs, mentors, corporate-startup champions, economic developers, and educators in and outside of Iowa can dial in on the startup activity happening across the state while finding the next business to support.
If you are a startup that would like to be featured, please fill out the application here.
Feedback, suggestions, or questions? Reach out to Diana at dwright@dsmpartnership.com.
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Actively Raising
🚀Gross-Wen Technologies
Highlights: Gross-Wen Technologies (GWT) provides sustainable wastewater treatment solutions to both municipalities and industries. GWT’s patented, algae-based treatment technology, the RAB™ system, effectively recovers valuable nutrients -- nitrogen (N) and phosphorus (P) -- from wastewater while capturing carbon dioxide from the atmosphere. Collectively the RAB™ treatment platform has been identified as the most sustainable and cost-effective method for the removal of N and P from wastewater.
Raising: $4,000,000 \ Committed: $2,000,000
Backed by: ISA Ventures, Rural Vitality Fund, Next Level Ventures, Ag Startup Engine
Co-founded by: Dr. Martin Gross and Dr. Zhiyou Wen; Executive Summary
Contact: martin@gross-wen.com + web; HQ: Slater, Iowa
🚀Spanton Dynamics
Highlights: Spanton Dynamics has created a patent-pending, power-driven spine board that contours underneath an injured person and operates like a conveyor belt. The Spanton Board has the ability to be used in a variety of medical applications. To date, the Spanton Board has been showcased at dozens of expos and demonstrated to professional athletics. The team is currently testing with the NFL, military, and emergency medial services market.
Raising: $1,250,000 Committed: $250,000
Backed by: IEDA, Wellmark Venture Capital Fund, Iowa Startup Accelerator
Co-founded by: Anna Spanton and John Spanton; Executive Summary
Certified as an Iowa Women’s Business Enterprise
Contact: anna@spantondynamics.com + web; HQ: Fairfield, Iowa
🚀Want to be featured? Looking for more Iowa startups for investment?
For a list of more startups actively raising (that may not appear in this newsletter) or to be featured in the next edition, reach out!
Closed Rounds
💰Koloni announced a closed seed round of $1.3 million. The round was led by Jason Calacanis’ Launch Fund with additional investments from ISA Ventures, Twelve19 Ventures, Chicago Early Growth Ventures, Locker One Ventures, and others
💰Member MarketPlace closed a seed round of $500,000
💰No Limbits lands $100,000 investment on ABC’s 'Shark Tank’ from investors Mark Cuban and Emma Grede
Mergers & Acquisitions
+ Workiva acquires ParsePost for $100 million
On the Horizon: Companies to Watch
FarmlandFinder by EasyKnock- Offers sale leasebacks to farmers and can help them achieve goals such as strengthening balance sheets, funding operations, eliminating debt, and buying more land.
Groov - Offers an innovative SaaS solution for property developers to organize and facilitate land development and sales.
Haggle - Develops a unique online marketplace for farmers to barter the use and services of idle equipment with other farmers.
Mod Advisor - The simple mod analysis tool for insurance agencies who want to be the trusted work comp professional.
Sprayer Mods - Develops a patent-pending camera attachment for agricultural applicators to reduce the use of expensive and potentially hazardous chemicals.
Stagerie - Creates a fast, affordable, and professional online home staging marketplace for realtors, homeowners, and stagers.
Toggle - The innovative, end-to-end supply chain management system that automates current processes in the shipping industry.
VizyPay - Founded by small business owners to look out for small business owners. VizyPay makes accepting credit cards easy and affordable
Upcoming Events
📅 April 19 - 21 - Global Insurance Symposium + InsurTech Expo in Des Moines
📅 April 21 - FemCity Des Moines
📅 April 22 - Black and Brown Business Summit
📅 April 27 - Intro to SBIR/STTR, America’s Seed Fund
📅 April 28 - ScaleDSM Minority Business Accelerator Info Session
📅 May 17 - Crash Course: Sales for Startups
Featured Interview: IA Women in Venture Capital
Meet Mikayla Sullivan from ISA Ventures and Liz Keehner from Next Level Ventures
Talk about women in startups and venture capital today. What excites you about your role and impact?
Keehner: It’s no secret now that women-led startups received just 2.3% of VC funding in 2021. When I started my career in VC almost 8 years ago, now, that figure was a little less than 2%, so the needle hasn’t moved much. That was really what inspired me to pursue a career in VC because it isn’t until more women are on this side of the table can we make an impact for women raising capital.
As of 2021, only 12% of decision-makers at VC firms are women. According to a Boston Consulting Group, women-led startups are more likely to deliver higher revenue – “more than twice as much per dollar invested”. It would seem to me that investing in more women is a no-brainer for VC models.
Sullivan: Liz provided a great macro view but I'd like to focus on Iowa. I don't have the metrics for other funds, but at ISAV 12% of the capital we've deployed so far has been invested in women-led companies, representing 28.5% of the companies in our portfolio. I can count on one hand the number of women-led companies that have raised a round of over $1M here in Iowa.
In addition, women in Iowa hold 0% of General Partner positions (often the final decision-makers for funds). Women can and do build venture-scaleable companies, but there's a lack of local role models to reach out to, and when 100% of the power is held by men, VC dollars seem inaccessible. We need to do better, and while ISAV's stats are better than the national average there's still room for improvement. I'm excited to fix this over the next 5 to 7 years.
What would you tell other women starting something? Or on the flip side, women starting in venture?
Keehner: For women wanting to pursue a career in venture, I would say you do not need to go the “traditional” career route i.e. investment banking. I think that’s still a big misconception for young professionals who want to work in VC. My advice would be to start learning about the VC world (Venture Deals is a great resource for this), figure out what industries/trends you are passionate about and research startup companies in those spaces, network with people at VC firms that appeal to you and start sending them deal flow with your thoughts on why the company would make a good investment for that firm.
There are also VC firms, like ISA Ventures, that offer apprenticeships/internships for people who want to learn VC without requiring any previous experience. Follow the VC world on Twitter! There are so many top-notch investors that are giving out their thoughts for free. It’s a great way to learn and connect.
Sullivan: Ask for help. I look back at my 6 years building KinoSol and so many mistakes could have been avoided if I hadn't been afraid to ask for help or feedback. The pressure to prove I was capable and belonged, got the best of me.
When I jumped into VC, I knew very little, and this time I was not afraid to ask for help and leverage resources, many of the ones Liz mentioned, to get up to speed quickly. If you're interested in a career in venture capital, you don't need to follow a traditional path and have a business degree or finance experience. Dive into industries that excite you, ask questions, build a network, and learn to critically evaluate information. For me, the experience of building a company has been pivotal to doing this job well, so consider working at a startup to understand what it's like on that side of the table before you jump into VC.
What is one thing that's on your wish list for the Startup Iowa ecosystem?
Keehner: I want to start by saying I am super proud of the fact that Iowa has increased the number of women VCs by 300% in the last two years. Being intentional about creating diverse teams at a VC firm is the first step. My wish for the Iowa startup ecosystem would be to see a woman-led startup raise a record fundraising round and then hit a home-run exit. I believe the impact that would have on women founders to follow would be pivotal for Iowa.
Sullivan: More transparency, from both founders and investors. We glamorize raising large rounds of capital and acquisitions, but we don't talk about the difficulty of raising those rounds, if those acquisitions were good for the founder, or discuss when things go drastically wrong. The only way our founder community gets stronger is if founders participate and are transparent about the difficulties that come with starting a company.
On the flip side, investors aren't the most transparent either. We have a hard time saying no and expressing why. But if we can't give founders transparent feedback that their pitch isn't convincing or their financial model doesn't make sense, who will they hear it from? We're not perfect at ISAV but we've made great strides to give founders transparent, critical feedback as to why we are not investing versus "you're too early", or "it's just not a fit".
Want to be featured in the next Startup Iowa Hot List? Reach out to Diana at dwright@dsmpartnership.com.