First Northeastern PA-Based Crowdfunding Event
Pivitec, LLC won Ben Franklin Venture Idol, hosted by the Ben Franklin Technology Partners of Northeastern Pennsylvania on Thursday, November 21. The event was held at the Innovation Institute in Ben Franklin TechVentures®, the award-winning technology incubator/post-incubator on Lehigh University’s Mountaintop Campus.
Ben Franklin Venture Idol is like a cross between Shark Tank® and American Idol®, but with entrepreneurs and investors instead of vocalists and celebrities. The event illustrates a significant way in which early-stage entrepreneurs seek and obtain seed capital. Ben Franklin Venture Idol 2013 was the first “in-person” crowdfunding event ever to be presented in northeastern Pennsylvania.
Approximately 225 guests attended the sold-out Ben Franklin Venture Idol, which included pre- and post-event executive networking receptions. Ten company candidates were identified as Ben Franklin Venture Idol competitors, including Impatient, the winner of Lehigh Valley Tech’s Startup Weekend event that was held November 15-17 at Ben Franklin TechVentures.
Following a networking session beginning at 5:30 PM, the evening event began with a keynote address on crowdfunding by Brian Meece, CEO of RocketHub.com.
In addition to Impatient, the Ben Franklin Venture Idol competitors were: Bison Analytics, LLC, Lewisburg; Cerora Inc., Bethlehem; eVendor Check, Hawley; GiveGab, Dunmore; Map Decisions, LLC, Bethlehem; Orbweaver Sourcing LLC, Center Valley; Pivitec, LLC, Bethlehem; PROVA Systems, LLC, Carbondale; and Skaffl, LLC, Allentown.
After earning their way through two rounds of judging in the afternoon prior to the evening event, three remaining start-up technology company entrepreneurs were selected. Company finalists Cerora, Inc.; eVendor Check; and Pivitec, LLC pitched their ventures to investors and the audience in the evening.
Following short critiques from a panel of investors, the audience members “funded” the companies, crowdfunding style. With $100 of “Ben Bucks,” each guest distributed his or her “investment dollars” in whole or part among the three finalists. Ben Franklin will award $15,000 in real dollars to the companies based on the “crowdfunded” audience vote.
Pivitec develops and markets leading-edge, networked audio streaming and distribution products. Modern performances in theaters and houses of worship require a variety of approaches to provide performers the ability to hear their own performances as well as cues. Wired systems currently in use require extensive cabling, limiting performers’ movements, and have limited audio source reception. Pivitec uses wireless mobile devices as interactive controllers for its network devices to address problems in live professional audio productions. Ben Franklin Technology Partners has invested a total of approximately $290,000 in Pivitec since 2010, and the company is a resident in Ben Franklin TechVentures.
Crowd funding for early-stage firms involves the collective effort of individuals who network and pool their money, typically via the internet, to fund a company. Although selling shares of stock is not yet allowed over the internet, companies seeking funding on crowd funding sites like RocketHub.com often provide gifts in exchange for contributions. This form of crowd funding has recently received attention from U.S. policymakers with direct mention in the 2012 JOBS Act, legislation that allows for a wider pool of small investors with fewer restrictions. Portions of the JOBS Act that permit wider publicity of companies seeking to sell equity, including use of the internet, were recently adopted by the U.S. Securities and Exchange Commission.
The evening’s investor panelists were:
Chad Paul, Ben Franklin Technology Partners President and CEO, hosted and Fred Beste, CEO of the General Partners, Mid-Atlantic Venture Funds and Ben Franklin Technology Partners Board Chairman, was the emcee.