A New Startup Financing Model and the Passionate Voices Behind ItFrustrated by the lack of access to startup capital, three serial entrepreneurs lobbied Congress to legalize crowdfund investing -- and won.
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In 2010 Sherwood "Woodie" Neiss was trying toraise capitalfor his latest business concept, a data-polling app forsmartphones. He had a track record as CFO of FlavoRx--an award-winning medicine-flavoring company he co-founded in 1999 and sold eight years later--and his new idea had won him a Startup Weekend pitch competition. But without three years of financials, the banks weren't interested in investing in hisapp; neither were angels,venture capitalistsor the private equity investors who'd put millions into FlavoRx. Personal credit wasn't an option, either: Thanks to the recession, Neiss' Miami home was underwater, and his credit card limits had been slashed.
Suddenly the capital crunch faced by so many startups after the economy tanked became personal. "I was irritated by the fact that I could do it before and now have that credibility and not be able to do it again," Neiss recalls.
