Steve Holt needs an angel.
An angel investor, that is. The owner of Allyson's Kitchen is looking to expand to a second location in Bend, but has yet to raise the necessary funds. He's approached several investors, but it's often hard to tell who has the means and interest to invest in a small business without creating an awkward situation, he said.
That's where the Jefferson Grapevine comes in. The new networking group for Southern Oregon aims to connect local investors and entrepreneurs in hopes of bolstering local economic growth.
Modeled after the pub talks started in Portland and Bend, the Jefferson Grapevine plans to host bimonthly meetings at wineries and other large forums in addition to creating an angel investor network.
"What we're looking for are people who have substantial net worth," said Ron Fox, director of Southern Oregon Regional Economic Development, Inc., one of the groups sponsoring the program. "Generally these are people with personal annual income over $250,000 or net worth of $1 million."
These individuals make investments of $50,000 to $100,000 in the early stages of business start-ups, before the business is operational and qualifies for commercial loans. Instead of having the money paid back dollar for dollar, investors get a stake in the company, which can make it a risky investment if the business fails, Fox said.
Part of the impetus for the angel investor network was local entrepreneurs seeking funding elsewhere, in Portland or Bend, Fox said.
"That creates a challenge because a lot of times the investors want to have their investments close to them," he said. "They don't want to travel five hours to look over their business."
A local investor network also ensures that capital stays local.
"The goal is really to create an environment that can encourage and attract development in the region," he said. "We want to grow our own businesses, help existing businesses grow and succeed and encourage new businesses to move to the area."
While seeking funds for Allyson's Kitchen, Holt sought investors, local or not, but he said the advantage lies with local investors.
"Local investors probably have a better understanding of your business because they have seen it in action," he said. "They certainly understand what reputation you carry, and they're part of the community."
Investors also have more opportunities to check up on daily operations, he said.
Fred Marken, who owns the Grilla Bites chain of restaurants, considers himself an entrepreneur, but is also transitioning into the role of investor as he seeks out co-owners for new store locations. His company helps smaller entrepreneurs qualify for federal loans from the Small Business Administration.
He plans to attend Jefferson Grapevine meetings to offer his own entrepreneurial experience and help out local people willing to work hard.
"There are a lot of people with talent that need the people with financing to bridge that gap," he said. "I'm in it to make sure other people can make money. If we don't stick together, all we're going to see is more McDonalds and TGI Fridays."
The next event of the Jefferson Grapevine is an entrepreneur's forum tonight at 5 p.m. at the EdenVale Winery in Medford.
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Jefferson Grapevine pairs investors with entrepreneurs
Steve Holt needs an angel.