Tag Archives: Private equity

BLOOD CENTER

Jayson Kurfis

7-0_immunology_nkcell_TAdapted from News From Heartland

Since the early 1900s, the state of Wisconsin has been at the forefront of commercializing great scientific discoveries. With the renewal of a 5-year, $20 million competitive grant to the Clinical and Translational Science Institute (CTSI), funding will go to a consortium of eight regional organizations whose mission is to advance the health of the community through research and discovery. This will offer significant opportunities for investment. The article focuses on the innovations of one of those groups, BloodCenter of Wisconsin.

Blood-Center improves outcomes for people with blood-related disorders. This includes providing educational services to the medical community, while providing 70% of the blood used in the State of Wisconsin. Beyond these valuable services, BloodCenter has a substantial research effort focused on finding cures. In fact, from a research standpoint, it is well-known and extremely active in the peer review process, and has produced over 3000 research publications. The primary focus of Blood Center’s Medical Science Institute is research in the areas of transfusion medicine, hematology, bleeding and clotting disorders.

Of particular interest to investors is the work of its technology transfer office. The organization holds over one hundred issued patents in the US and abroad. The strong patent and license activity helps “bridge the gap” from basic research to commercialization. The institutions most successful spin-off, GTI Diagnostics currently owned by Immucor, is focused on blood-based diagnostics. The company sold to a private equity firm in 2008 for approximately $20 million dollars and sold two years later to Gen Probe for $53 million.

Since the group was sold off by BloodCenter to a private equity firm, the global diagnostics market has experienced significant growth, which is expected to continue. BloodCenter continues to innovate within the diagnostics space.

 

Growth Curve

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Von Willebrand Disease Screening Assay

Von Willebrand Disease is the most common hereditary coagulation condition in humans; it has a variety of subtypes; however, Type 1 is the most common. The disease arises from a qualitative or quantitative deficiency of Von Willebrand factor (VWF), a multimeric protein that is required for platelet adhesion.

Market Size

VonWillebrand disease (VWD) affects an estimated 1% of the world’s population and impacts both males and females in equal proportion.

Technology Benefits

  • Uses standard ELISA or a scalable bead-based format allowing high throughput screening
  • No platelets used as an assay reagent leading to lower reagent and QC cost
  • No ristocetin used, which leads to reduced costs and efficiencies
  • Rapid and more accurate diagnosis of some sub-types of VWD

Patent Status

US8865415, US8318444, US8163496

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Improved Heparin Induced Thrombocytopenia (HIT) assay

6-1_tm_aeo_115x115Heparin-induced thrombocytopenia (HIT) is the development of a low platelet count after administration of the commonly used anticoagulant heparin. HIT causing antibodies can, in some patients, activate platelets leading additionally to thrombosis or clotting events causing stroke, loss of limb, or death.

Currently, the ELISA, enzyme-linked immunosorbent assay, blood test is aimed at detecting antibodies against heparin-PF4 complexes. This test detects all circulating antibodies that bind heparin-PF4 complexes, and has a high false positive rate. Therefore, those with a positive result are tested further with a functional assay called the serotonin release assay (SRA test), which is difficult to perform. An improved HIT assay represents a significant advancement.

Market Size

In 2014, heparin had a market size of 8.2 billion dollars. Heparin is given to millions of patients annually. About 5% are at risk for HIT. Any patient receiving heparin who develops unexplained thrombocytopenia should be tested for antibody.

Technology Benefits

  • Sensitivity and specificity measures are the same or better than current gold-standard SRA
  • Potential for improved reproducibility
  • Lower turn-around time and costs
  • Non-radioactive and lower complexity laboratory method

Patent Status:

PCT application was filed in November of 2014

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6-0_pharmtrials_115x115

Numerous other technologies are currently being developed at the Blood Center of Wisconsin. For more information, please contact Laura Savatski at Laura.Savatski@bcw.edu.

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Sources

(1) http://www.prnewswire.com/news-releases/gen-probe-acquires-gti-diagnostics-for-53-million-in-cash-111991764.html

(2) https://www.alliedmarketresearch.com/DNA-diagnostics-market

(3) http://www.prnewswire.com/news-releases/blood-screening-market—global-market-research-2015-2019-with-abbott-diagnostics-biomerieux-grifols–roche-diagnostics-dominating-300170181.html

(4) http://www.pmlive.com/top_pharma_list/Top_50_pharmaceutical_products_by_global_sales

(5) https://www.alliedmarketresearch.com/ivd-in-vitro-diagnostics-market

(6) http://corporate.morningstar.com/us/html/pdf/Healthcare-Observer-Jan-2013.pdf

(7) http://www.transparencymarketresearch.com/heparin-market.html

(8) http://www.xconomy.com/san-diego/2010/12/16/gen-probe-pays-53m-for-gti-diagnostics/

 

Copyright © 2016 Jayson Kurfis

Graphics – Blood Center of Wisconsin bcw.edu

This is an excerpt from an article that first appeared in NEWS FROM HEARTLAND

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Chicago Venture Magazine is a publication of Nathaniel Press www.ChicagoVentureMagazine.com Comments and re-posts in full or in part are welcomed and encouraged if accompanied by attribution and a web link. This is not investment advice. We do not guarantee accuracy. It’s not our fault if you lose money.

.Copyright © 2016 John Jonelis – All Rights Reserved

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ARISE 2.0

DSC_5954by Loop Lonagan

Whadaya think happens when 15,000 people get behind the entrepreneurs in their own neighborhood?  Good things—that’s what happens!  Energy.  Enthusiasm.  Stuff gets done!  Lemme tell you about it:

This is Loop Lonagan reporting and tonight I’m watchin’ a guy pitch his new venture like a Gospel Preacher workin’ up a frenzy on da pulpit!  I hear his bold words.  This guy believes in hisself—and why not—he’s growing a thriving business!  This is the Arise 2.0 accelerator and it’ll change our city fer the good.

(Hey, this thing gets my Irish up.  So ‘scuse me if I don’t sound smooth.)

Arise 2.0 gives Chicago a whole new slant on business.  They ain’t here to make a few people rich.  No, they build up local business so they can build up da local community.  Business is just a means to an end.  The goal is healthy neighborhoods, jobs, prosperity all around.  That’s the real end game here

DSC_6011

Arise already put together all the stuff of success plus a big kicker:  They got Investment—half a million in seed money.  They got the University o’ Chicago.  They got Tony Wilkins from Hyde Park Angels.  They got 1871—a great space to birth an accelerator.  They got a Ten-Year Action Plan that’ll pump out four new companies every year.  Yeah, they got all o’ that.  The kicker is da power of 15,000 people from the Salem Baptist Church because Rev. James T. Meeks figured out this great way to help his community.

You wanna bet against them odds?  I’m here to take yer money if yer patsy enough to try.  We’re talkin’ Free Enterprise nurtured by Da Church.  There’s a whole lotta motivation and commitment here.  This model could spread across the map!

 

Mentorship

Tony Wilkins runs the Arise 2.0 Accelerator.  I know Tony.  He’s smart.  I figure him for the brains o’ the operation.  Tonight he gives us a story about how to drive success.  Lemme say this slow so I get it right.  Here it is in his own words:     

DSC_5913I’m on my 537th business flight.  Southwest Airlines.  Isle seat.  A gentleman comes in last and squeezes into window seat beside me.  He looks jittery and nervous.  I ask him, “Are you okay?”

“Sorry sir.  This is my first time on a plane, I’m a little nervous.”

“It’s okay,” I say.  “It’s fine, don’t worry about it.”

The plane goes up.  But half way through the flight, he’s having problems.  He’s sweating.  He’s fidgeting.  I say, “Hey, the hard part’s over.  We’re in good shape.  The pilot wants to land just as much as we do.” 

“I understand, but I had something to eat last night and I have to apologize to you in advance, ‘cause this is not gonna work out well.”

DSC_5914So in my best mentorship mode I say, “You know…there’s a bathroom on the plane.” 

“PRAISE THE LORD!  WHICH WAY IS IT?”

 So mentorship worked out for him.  And it worked out for me.

If people knew better, they’d do better—like my travel companion on Southwest.  Everybody’s had somebody in their life who’s made a comment, performed an action, did something that made them say, “I can do that!”  So just presenting them with that information is often the most powerful thing in the world.

And they’ll become mentors to successive companies.

DSC_5915Accelerators across the country do the exact same thing.  We bring in mentors who, because they once had mentors, come and say, “I’ll spend an hour and a half.  I’ll spend an evening.  I’ll sit and talk to these companies.”  And many stick with them. It gives folks a higher perspective. 

Tony also passes on the knowledge to run a business:  How to hire and fire.  Marketing.  Funding.  Legal.  Operations.  Pitch practice.   “But,” he says, “the most important thing is mentors because that means contacts and business relationships and exposure to risk capital so these businesses can expand, become sustainable and scale.  If you remove barriers to mentorship and capital, good things happen.  We don’t know exactly what’s gonna happen—we’re just gonna have good things happen.” .

 

Church Business

I figure all o’ youse is wondering about the same thing.  The Church and business working together?  DSC_6147“Absolutely!” says Jamell Meeks, the pastor’s wife who oversees this bold initiative.  “The Bible says where your treasure is your heart will be.   So you can know a person’s heart by where they put their treasure.”  I gotta read that book fer myself.  Father Lonagan always said to leave it to da professionals, but I dunno.  Maybe I sound ignorant once in a while.  But I hate to actually be ignorant.

DSC_6133David Storch from AAR CORP is backing Arise with piles o’ da green stuff.  “It’s the entrepreneurs that make things happen,” he says. “They’re the lifeblood of the community.  Politicians talk about buzzwords like education.  But it’s really hard to talk about that when you don’t have food on the table or a roof over your head. But if you touch more people, you will build more successful businesses, which will create jobs, stimulate the economy, allow for education, which creates equality, creates opportunity, which we desperately need as a city, as a nation.

Steve Rogers from da Harvard School o’ Business once said, “The transformation of a community really begins with people within the community becoming great entrepreneurs.”

After that great quote, Pastor Miles Dennis of Second Baptist says, DSC_5995“We’ve almost forgotten—forgotten that entrepreneurship is the great transforming agent to turn around our communities.  They will change lives and yes, they will employ many people.  They will help others to become entrepreneurs.  The entrepreneurial spirit is alive!” .

 

Da Companies

Da competition fer each spot is super fierce.  A thousand companies wanted in but they whittled it down to these four.  These is Chicago-style companies—small outfits with allota upside and da gumption to grow.  Lemme tell you a little about ‘em:

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DSC_5939THE FROCK SHOP—Chicago’s Designer Rental Service

Jennifer Burrell Jen@frockshopchicago.com

Visit their website [click here]

How come us guys can rent tuxedos but da women gotta buy them fancy dresses?  And after a gal spreads her photo all over Facebook, she won’t wear that dress again.  But there’s something about da confidence beautiful designer dresses give women. Gals used to buy an outfit, hide da tag then return it after an event.  But nowadays the department stores is wise.  So Frock Shop’s got the rental business figured out and they’re thriving.  They’re gonna use online sales to scale fast.  Jennifer says, “Visit the Frock Shop where you can borrow the dress and keep the memory.” .

 

DSC_5983RS INDEPENDENT HOME HEALTH CARE

Ted & Reena Williams rena.williams@rsihhc.com

Visit their website [click here]

89% of seniors prefer to stay home and age gracefully.  30% need some kinda help.  This company goes into the home, cooks meals, gives meds, does laundry and housekeeping, takes ‘em to the doctor, and acts as companions—a whole lot more service than the usual rent-a-nurse.  And that means you can spend quality time with yer parents during those last years. They already got a contract with the veteran’s administration and they partnered with the Cancer Foundation.  This one’s creating jobs. .

 

DSC_6008

MA’S BEST

Brian Smith  brianearl2001@yahoo.com

This is a traditional baking operation, but when this guy describes eating his dinner rolls, it makes yer mouth water.  They already sell at 18 Chicago outlets.  Competitive advantages:  Better product.  No middleman.  Direct from oven to the store. Their direct competitors each do $137M a year and Ma’s Best outsells them 2:1 wherever they get shelf space.  Industry as a whole is $115B.  As Brian puts it, “That’s a lot of bread.” .

 

 

DSC_6084bSWISH DREAMS

Kenya Mercer  kdrew@swishdreams.org

Visit their website [click here]

Kids do lousy in school ‘cause they’re bored.  Kenya says, “Let’s give our kids the core academic values and let them have fun doing what they love—all at the same time.”  So they teach literacy, leadership, and physical fitness as one program.  And they get double-digit gains in literacy, fitness, and leadership on da assessment tests.  This one plans to expand nationwide. .

 

 

Salem Baptist Church LogoSALEM BAPTIST CHURCH

Pastor James T Meeks  info@sbcoc.org

……………………………………………..Visit their website [click here]

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DSC_5921ARISE 2.0

Tony Wilkins  tonywilkins76@gmail.com

Visit their website [click here]

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The accelerator strategy has three distinct components:

  • Remove barriers to mentorship.
  • Give broader perspective, contacts, and knowledge.
  • Structure risk capital to expand.

Check ‘em out.  Maybe be a mentor.  Maybe an investor.  But don’t sit on yer hands—da future’ll pass you by. .

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Loop Lonagan’s articles are verbatim as told to John Jonelis

Photography by John Jonelis

Chicago Venture Magazine is a publication of Nathaniel Press www.ChicagoVentureMagazine.com Comments and re-posts in full or in part are welcomed and encouraged if accompanied by attribution and a web link. This is not investment advice. We do not guarantee accuracy. It’s not our fault if you lose money. .Copyright © 2014 John Jonelis – All Rights Reserved . .

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THE ANGEL EDGE

PB&J T-JAJAdapted from the Journal of the Heartland Angels

Part 1 – by John Jonelis

Is an Angel a fool?

In the world of private equity investing, the order of funding is supposed to go like this:

  • Seed Round—that’s friends, family, and fools.
  • Angel Round—that’s funding the big initial spurt of growth.
  • Venture Round—that’s big funding for massive scaling.

Compare that stack-of-three (above) to a peanut butter and jelly sandwich. Notice that Angels make up the good stuff in the middle. And yes—according to studies by the Kauffman Foundation—Angels make the best money.

But sometimes Angels step in early—right next to friends and family. Sometimes they get in late—right next to VCs. That’s the PB&J squeezing out the sides of the bread.

We all know the friends and family round is the most likely to fail and we shoulda oughta shy away from it. But if we wait too long we ain’t makin’ no money. According to research by the Kauffman Foundation, investors in VC funds on average make a NEGATIVE return. That’s right—average negative. Angels do a whole lot better. So maybe it’s wise to avoid the sloppy edges. Make sense so far?

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The Basic Question

In investing, the exercise always boils down to this: Here’s the environment—how do we make money in it? Investors always look for an edge—some slight advantage over the masses. And there definitely is an Angel Edge. Let’s examine:

  • Angel investing is entirely non-correlated to the broader security markets. (Hey, if you got a stock portfolio to protect, that’s a big deal.)
  • An Angel’s potential return—on average—knocks the stuffing out of traditional securities. (Again, that’s according to research from Kauffman.)
  • Then there’s the intellectual exercise. (Let’s face it, that’s a reward in itself. Otherwise we’d all turn our money over to some manager or mutual fund.)
  • Then you sometimes get to roll up your sleeves and sit on the board of one or more companies, which can be a real blast. (Beats sucking on an umbrella drink on some tropical beach. At least I feel that way. I sunburn so easily.)

So the Angel route makes for an enticing package. But it’s not for everybody. Then there’s my general attitude: I’m always suspicious of enticing packages. So let’s take a peek at the risks and rewards.

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Risk

It is well known that private equity investing carries with it a high risk compared to stodgy investments like stocks or treasuries. (Treasuries pay close to zero these days). Rather than buying regulated marketable securities in all-too-efficient markets, an Angel negotiates terms and makes private deals. Anything can happen. Let’s identify a few of the risks:

  • No liquidity
  • No stop loss
  • Little diversification (That is, if you’re a lone wolf. More on that below.)
  • Long time horizon

An Angel typically waits 3-5 years or more to cash out. Hey, I come from the world of 1-7 days and out—MAX. To me, anything measured in years is a real long time. But 3-5 is a short time compared to Venture Capital. It’s short compared to starting your own venture. It’s real short compared to real estate.

PB&J 500-JAJ

Reward

There are a number of advantages that attract money to this model:

  • Larger average payoffs compared to investing in securities. (More on this in the next issue.)
  • The chance to buy a future Industry Giant at a very early stage. (If you do enough deals and perform your due diligence, that might actually happen.)
  • As mentioned, private equity is non-correlated to the broad markets, like stamp collections or antique cars. (That means you might make money, even when the broad markets tank.)

Let me explore that last bullet a bit deeper: This is an Alternative Investment Vehicle. Alternative investments tend to be high-risk. But as part of a larger portfolio they can—(and this is non-intuitive)—can INCREASE return and REDUCE overall risk. Nice combination, don’t you think?

This strange phenomenon is mathematically demonstrated on a graph called The Efficient Frontier. It takes some thought to set up the strategy, and don’t overdo it. Conventional wisdom is to limit alternative investment to less than 10-15% of a total portfolio.

 

Risk Mitigation

How do you raise your returns above the averages, yet control risk? Skill, knowledge, and raw instinct? Personally, I don’t harbor such fantasies—I believe that it’s better to belong to a group. As a member of an Angel group, you enjoy a number of advantages that reduce risk:

  • Diversification – To throw all your capital into just a couple ventures is clearly dangerous. Members of a group can spread their deals across a large number of companies.
  • Industry Knowledge – A strong Angel group includes experts, in various industries. What single individual can boast deep knowledge of more than one or two industries?
  • Expertise – Members come from various disciplines—Finance, Accounting, Marketing, Operations, Science, Engineering. Who holds diplomas in all those areas?
  • Workflow – Many hands make for light work.
  • Control – When you play the stock market, you exercise HOPE. In contrast, an Angel group may have a member sitting on the Board of Directors.

Let’s Review

  • This is an Alternative Investment. Keep it small compared to the overall portfolio.
  • Join a strong Angel group and use it as your research team.
  • Spread your resources across as many diverse companies as you can.
  • Be patient. It may be a long wait for that first winner.

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MORE TO COME ON THIS TOPIC

READ THE FULL JOURNAL [PDF]

.HeartLand Angels Logo 3

NEWS FROM HEARTLAND – the Journal of the Heartland Angels, is published quarterly as an information service to its members. Articles may be reproduced in full with attribution for educational purposes.

Copyright © 2014 Heartland Angels – John Jonelis, Editor – John@HeartlandAngels.com
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Chicago Venture Magazine is a publication of Nathaniel Press www.ChicagoVentureMagazine.com Comments and re-posts in full or in part are welcomed and encouraged if accompanied by attribution and a web link. This is not investment advice. We do not guarantee accuracy. It’s not our fault if you lose money.

.Copyright © 2014 John Jonelis – All Rights Reserved

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THE FRENZY

Funding Feeding FrenzyBill Blair – special correspondent –

as told to John Jonelis

Bill Blaire here.  Mr. Jonelis wants I should go to this FUNDING FEEDING FRENZY thing. Says I’m gonna give a completely different slant compared to the resta this crowd here. I cut my teeth in the Local #1 Boilermakers, then as a Cement Contractor till I packed up my tools fer good.

Me? I’m always open to new ideas. I make loans to all kindsa people. John says I’ll see someFFF Logo real sharks at this place and that strikes me as a nasty crack but I let it slide.

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The Sharks

So I get here and whadaya think? Deeze guys is all legit investors. I glad-hand every one o’ them and their little mits all disappear between my hairy fingers. But I gotta give it to ‘em—these guys got balls. They throw money at raw startup companies and win maybe only 3 outa 10—and that’s just if the investors is real smart. They don’t get paid back by the deadbeats neither.

I don’t like them odds at all. Hell—the stuff I put money in gets a guaranteed payout or else, see?

Glenn Gottfried

Glenn Gottfried

Then I meet Glenn Gottfried—real smart guy. He explains it all to me. These is all private equity deals. Not a loan in the house. The ones that come in can make it big—REAL BIG. I’m talkin 10 times return—sometimes 100 times or more. It’s the stuff they make dreams outa. That gets my juices flowin’ and it’s all legal! Hoo boy, I’m gonna have some fun here!

I remembers catchin’ an episode o’ Shark Tank on TV and so I got the general idea.

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The Hideout

Chopin Theater

Chopin Theater

I don’t usually get caught dead at no place with a name like Chopin Theater but I always help my friends. And it turns out real nice. This thing goes on all day so they got coffee, booze, food, good seats—my big butt laps across two o’ those.  Nobody’s breathin’ down my neck ’cause none of ’em can see over my head. Yeah, it’s all good.

So here I is with my buddy Rocco Spumoni of the Pierce O’Shea Mob. Oops—maybe I oughta call it an investment firm, get the picture? Anyhow, Rocco goes after some gal and I ain’t seen him since. I think her name’s Jane Pickling or something, but I dunno fer sure. Lemme get down to business: Ludditis Shots and Beer

I wanna give you the whole picture first, so in a minute I’m gonna show ya a hard-hitting video from Blackline Review.  My buddy David Carmen is part o’ that outfit. They got that catchy name cuzza the L trains here in Chicago. There’s a Blue Line and a Red Line but there ain’t no Black Line. If there was, you can bet they’d build another Ludditis Shots & Beer right under the tracks.  Chicago’s best potato pancakes too. 

Anyhow, this video gives ya the flavor o’ the whole thing and it’s short:

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Check out Blackline Review fer more o’ that kinda stuff.

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The Companies

Phil Murphy of Call Potential  was the winner last time. He gives the keynote along with some guy that makes goofy looking glasses that cost an arm and a leg. But hey—people buy that stuff like crazy so who am I?  Murphy’s real smart. When he’s done speaking he sits down as one o’ the judges. I’ll get back to him later.

The companies is all kinds: There’s the Bomboard jet ski that fits in my trunk and I want one.  John West and Anders Stubkjaer put that one together. Then on d’other sida things there’s Nature’s Little Recyclers, a worm farm that can solve alotta pollution problems.  Blame that one on Ed Hubbard.

Jerry Freeman of PaletteAPP

Jerry Freeman of PaletteAPP

We get an update report from a Jerry Freeman’s company, Palette APP. They’s gettin’ traction now and it’s off to the races.

I’m comin’ back with a lot more on this event so keep yer heads up.  Meanwhile, lemme give you the winners: 

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The Winners

1stSmart GardnerCarl Alquire

Uses high tech to help city people grow their own healthy food.

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2ndPortapureGeorge Page 

We seen this guy before and he’s good. Won alotta awards.  Clean water fer the third world.

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3rdCardoonaColin Robertson, Jeffrey Herrington

Making it super-easy for restaurants to place orders with ALL their vendors.

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The Crowd Favorite – Geek Bar – David Zoltan

And yeah—this one’s a real riot. A bar that celebrates geekdom.

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Photo and Video Credits – Royalty Free Images, Glenn Gottfried, Wikipedia, Blackline Review, Donatas Ludditis, John Jonelis

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Go to – THE BUSINESS PLAN POLICE

Back to – MY KRAKEN ENCOUNTER

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Our logo proclaims “Chicago is the World.” We believe creativity is spawned by adversity. That makes Chicago a growing center for thought leadership in the world.
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Chicago Venture Magazine is a publication of Nathaniel Press www.ChicagoVentureMagazine.com Comments and re-posts in full or in part are welcomed and encouraged if accompanied by attribution and a web link . This is not investment advice. We do not guarantee accuracy. It’s not our fault if you lose money.
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Copyright © 2013 John Jonelis – All Rights Reserved
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Filed under angel, angel capital, angel investor, big money, Bill Blaire., Characters, chicago, Chicago Venture Magazine, Chicago Ventures, chopin theater, Donatas Ludditis, Entrepreneurship, Events, FFF, Funding Feeding Frenzy