If you are running a startup company, you might already know about Katherine O’Neill, and you might have already tried to get a moment of her time. As executive director of the JumpStart NJ Angel Network, O’Neill is part of a community of investors who are ready and willing to take risks funding companies in their earliest stages. More often than not, O’Neill is the first to invest in a company after the business owner and family members.
If you do get a chance to pitch O’Neill or someone like her, you had better make it good, because she’s looking to fund sensible business ideas, not crazy schemes.
“I’ve been asked to fund a boxing ring in Camden and an international balloon race,” she says. “Someone recently sent me a business plan where they were going to acquire two major corporations because they had some piece of technology they would like. They get about one minute of my time and then they’re going into the round file.”
An upcoming event is designed specifically to bring together investors like O’Neill and the owners of startups. The New Jersey Entrepreneurial Network will host its Gathering of Angels event on Wednesday, June 10, from 11:30 a.m. to 3 p.m. at the Princeton Marriott. The group will select 15 early stage companies to exhibit their businesses before and after the meeting. During the meeting, attendees will have two to three minute “speed dating” sessions with angel investors from one of 11 different investor groups, including the JumpStart NJ Angel Network. Tickets are $50. For more information, visit www.njen.com.
Jumpstart is also hosting a “Meet the Angels” reception on Wednesday, June 24, where a small number of business owners will be selected to mingle with the investors over drinks. The event is by invitation only. To apply, visit www.jumpstartnj.com, E-Mail email@example.com, or call 856-813-1440.
Although O’Neill is quick to reject outlandish ideas, Jumpstart NJ is looking to fund innovative companies, not conventional ones. The network has funded companies that make a device for cataract surgery; semiconductors; parental controls for phones; mobile video games; and a speech translator; and many others. They have also funded lower-tech but still innovative businesses such as one that allows customers to receive a box full of age-appropriate baby supplies that is mailed every month. Its most successful venture so far — a mobile antenna firm — made back five times the initial investment in a year and a half.
“We have to have a high growth business that will be able to be sold at profit,” O’Neill says. “We’re not going to invest in, say, a local deli.” Generally, Jumpstart NJ looks for business-to-business customers rather than consumer-facing firms.
But with great opportunity comes great risk, O’Neill says. Many of the companies it funded died out before getting off the ground. “We only hope that if a company doesn’t do well that it dies faster rather than longer,” she says. “We are investing in a lot of pre-revenue companies, which is a risky stage.”
When deciding whether or not to invest, O’Neill says she evaluates the business plan as well as the leadership of the company. The best way to get her attention is to have a good “elevator pitch” where you can describe what the company does in 30 seconds.
“You really have to have your description of your company and your value proposition well defined,” she says. “For example, ‘I have a company that’s going to make people take their medications and reduce hospital re-admission rates by X percent.’ It’s important to be able to describe it very succinctly.”
O’Neill sizes up the leader as well as the idea. “Can this person execute the vision they’ve described?” she says. “Execution is the most important part of the business. First of all, you have to be able to describe the execution. If they can’t describe it, they can’t get there. Do they have a prior history in this space? Is this something they know really well, and do they have a team assembled that covers important bases in the business?”
Once Jumpstart invests in a company, it does everything it can to help it succeed. Often that means expert advice from a board member, or by helping the company make connections to important business contacts or clients.
The experience of the JumpStart team members helps to cover deficiencies that a young business owner may have. “A lot of times, people have blind spots about their competition, and they don’t realize how many other businesses may be in their space,” O’Neill says. “Entrepreneurs are in love with their business and their product, and they many have a blind spot.”
Most of the members of the Jump Start group are former entrepreneurs who cashed out and now want to help the next generation of business owners. O’Neill came to angel investing by a more roundabout path.
Born in Mississippi, O’Neill was raised in an Air Force family, moving all over the world. She came to the University of Pennsylvania for graduate school, where she earned her master’s of economics before getting a job at FMC in Philadelphia and moving up to executive positions. Later in her career she worked at what is now GlaxoSmithKline, retiring when the company moved its headquarters to Britain. O’Neill decided to remain in the town where she lives, East Windsor, and use her business experience to become a consultant, and ultimately finding her way into the angel investing world.
“Someone came to me with an acquisition to do, and I said, ‘piece of cake,’” she recalls. “I started getting a lot of consulting work as a CFO for businesses and funding for early stage companies. I was getting into that space when JumpStart was formed, and the New Jersey Technology Council asked me if I was interested in it.”
O’Neill says she likes staying involved in the cutting edge of business. In addition to her work at JumpStart, O’Neill is involved in many other business organizations and is a frequent speaker at technology and startup business events. She also mentors young entrepreneurs and helps judge business pitch and poster competitions.
In that way, O’Neill’s job is not unlike being on the television show “Shark Tank,” where business owners pitch a panel of three investors on their ideas, and are then accepted or rejected in entertaining fashion. She has been a “shark,” a snake in a “snake pit,” and a “piranha” in various copycat events. However, without TV viewers to please, O’Neill doesn’t feel the need to be rude.
“We’re not like they are,” O’Neill says. “We’re not going to take apart a person or insult a person for promoting their business.”