Helping build early-stage startups into great companies is quite a task, but it has been the goal of RTP Capital ever since four Triangle residents brought the angel investor group to life.
The story begins in 2010, just shortly after the Great Recession, when many were scared to take financial risks. But RTP Capital President Mark Friedman, who has been involved in Triangle entrepreneurship since the 1980s, was at lunch with several other members of the local business community—Andy Schwab, Bobby Bahram and Parrish Ketchmark—when it all came together.
“At that point, there weren’t really angel investing options available to the Triangle,” Friedman said. “There had been some angel funds that had run their course. But there were just no real, organized ways to work together and find early stage companies.”
From those original four founders, RTP Capital now includes 65 members. The group has collectively invested nearly $6 million in more than 30 companies, spurred nearly as much by the camaraderie between members as the investment opportunities themselves.
“If we were going to build anything,” Friedman said of the founding four, “we wanted it to be based on trust with the other people we’d be investing with.”
RTP Capital doesn’t have a dedicated fund that it’s raised to make investments from, like an angel fund or VC fund would. Instead, its members invest individually in companies that interest them on a deal-by-deal basis.
“RTP Capital is a network,” Friedman said. “As a network, we don’t make investments ourselves. What we do is bring in companies that we think would be interesting to our members, and we go through an initial screening.”
Although the group does not have a uniform investment strategy, Friedman said RTP Capital’s investors typically look for the startups that are close to or already have some revenue, often in the life sciences, IT-related or agriculture fields. But the investments are diverse, ranging from Second Nature (formerly FilterEasy), an air filter subscription service, to UVision360, a medical device startup.
UVision360 CEO Allison London Brown went through the screening process and secured an investment from several group members, which she said led to increased capital-raising opportunities in the area. Friedman and RTP Capital Director Elaine Bolle were especially helpful on that front, Brown said. UVision360 is a startup that seeks to provide better office-based treatment options for female patients and their providers with the Luminelle DTx Hysteroscopy System.
“Mark and Elaine have been tremendous assets for us in trying to find new investors and sharing their due diligence reports with other people,” said London Brown, “so it’s really expedited our ability to get additional funders in.”
RTP Capital is not solely comprised of experienced angel investors. As time has passed, the membership has evolved to include many inexperienced angel investors, something Friedman said RTP Capital aids with.
“The great bulk of people who’ve joined have never made an angel investment before,” Friedman said. “So we try to provide education for our members and teach them what being an angel investor is all about, and hopefully help them make good decisions as far as their investment analysis. And we really just continue to try to bring in companies that our members would be interested in making investments in.”
The group meets the second Thursday of each month at the First Flight Venture Center in RTP by invitation-only, but that doesn’t mean it works completely alone. RTP Capital doesn’t just make sure its own members have access to the due diligence it performs; it’s more than willing to share it with other angel groups in the Triangle. That cooperation is reciprocated to the benefit of Triangle entrepreneurs and angels alike.
“One of the great things about the Triangle’s entrepreneurial community is that it’s very collaborative,” Friedman said. “All the angel groups work together. You have a lot of areas in the country where the angel groups don’t work together.”