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Thursday, 26 April 2012 13:52

Start Garden to be catalyst for growing business ideas

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GRAND RAPIDS — Amway scion and ArtPrize founder Rick DeVos has launched a new venture capital fund that blends elements of elevator pitch competitions, business mentoring and community engagement.

DeVos introduced Start Garden LLC, which is backed by a $15 million commitment from the DeVos family, on April 26 at a press event at the JW Marriott Hotel in Grand Rapids. The company will make initial $5,000 investments in new companies each week and then participate in follow-on investments of up to $500,000 as some of the ideas mature and develop into projects or businesses. Companies or individuals can submit ideas via the company's website,

“It’s unlike any fund in the world,” DeVos said. “It involves hundreds of ideas, which can come from anywhere and from anyone."

The organization plans to make two $5,000 investments each week, one to a business idea selected by Start Garden staff and the other to an idea selected by community members in an online vote. The first round of investments begins May 3.

The ideas selected for initial funding must incorporate as a Michigan LLC and the representative must agree to return in 60-90 days to provide an update on the company’s progress. Start Garden has enlisted partners including Steelcase Inc., Amway Corp., Cascade Engineering Inc. and Fifth Third Bank to provide resources and mentoring to companies.

“We’re looking for people who do something smart with a little,” he said.

If Start Garden staff thinks more investment is merited, it will decide whether to put an additional $20,000 in the idea to help move it forward. The organization said it will incrementally invest up to $500,000 in a project that demonstrates momentum and growth.

“Our philosophy is that it could be a big investment or a small investment, but it’s always an investment in the next step,” he said.

More developed ideas could be eligible to go immediately to the higher levels of investment, in the $20,000 to $50,000 range.

At the $5,000 investment level, Start Garden takes no ownership of the company, but it does retain an option to be an investor “should it turn into a successful business.” As an idea moves to the project phase and into becoming a business, Start Garden has an option to remain an investor in the company, at the very least for 3 percent equity if the company issues securities in the future. If the idea continues to advance and the company seeks another round of investment, Start Garden has the right of first refusal to invest in the entire amount or a portion.

“Start Garden is looking for seeds. Start Garden creates the field and brings the water. We ask the people to bring their ideas and plant them. We ask existing businesses in our region to become the farmers. We believe the soil is fertile for business here and we can be the best place for someone to have an idea and run with it,” DeVos said.

DeVos said Start Garden is an “evolution” of the Momentum program. He said he was putting the 5x5 Night event on hiatus for the summer. The event could morph into the monthly update event for Start Garden, he added.

Read 1697 times Last modified on Saturday, 11 August 2012 09:45

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