A new investment fund focused on putting money into Montana businesses ready to scale up operations or cash out was announced Friday afternoon.
Liz Marchi, founder of the Frontier Angel Fund II, declined to say how much money the group has raised or comment on further fundraising efforts, citing recent changes to Securities and Exchange Commission regulations governing angel investment groups.
She said the group will be based out of her barn in Polson — “very low overhead” costs — and that it'll work with a syndicate of angel investment funds from around the country.
Angel investors are people who invest relatively small amounts, typically $5,000 to $100,000, of their own money directly into a business in its early stages. In exchange, investors get stake in the company.
Having the Frontier fund plugged into a national web of such investors will help minimize the risk of an investment by spreading it out across a larger number of people, Marchi explained.
“I'm so excited to be at this point,” she said. “We're just thrilled with the pipeline of deals we're looking at in Montana.”
The fund has a “Meet the Angels” pitch event planned for September in Bozeman, Marchi added.
Larry Cates, a former executive with PepsiCo and Applebee's, is head of the fund's executive committee. Also on the committee are Susan Carstensen, former RightNow Technologies chief operating and financial officer; Leon Liebman, venture capitalist; Bill Burg, a certified public accountant; and Jon Marchi, longtime Montana investor. Cates was involved with Frontier Fund 1, along with Liz Marchi, which was founded in the Whitefish and Kalispell area in 2004, made 18 investments and has had three of its investments exit. Exits typically occur when a business makes an initial public offering or is bought out by a larger company in an industry.
Investors in the fund are bullish on Montana's entrepreneurial scene. The news release announcing the fund's existence cited the sale of RightNow Technologies as a primary driver for spreading talented entrepreneurs and money across the Treasure State, along with the declining cost of starting technology businesses as the reasons for the fund's optimistic stance.
Rob Irizarry, one of the fund's investors, described the fund's presence as a “perfect scenario” that allows the growing number of entrepreneurs in Montana to access funding to help their businesses grow. Irizarry also serves as director of the Blackstone LaunchPad at Montana State University. He said more than 50 student- or alumni-founded startups have approached him and Paul Gladen, director of the University of Montana's LaunchPad, since the beginning of the year.
“All the right stuff is in the petri dish for the next wave of awesome startups,” Irizarry said.
Jason Bacaj may be reached at email@example.com or 582-2635.