In 2010 Sherwood “Woodie” Neiss was trying to raise capital for his latest business concept, a data-polling app for smartphones. 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 his app; neither were angels, venture capitalists or 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.
Many people complain without taking action. Neiss is not one of them. Along with buddies Jason Best and Zak Cassady-Dorion–all graduates of Arizona’s Thunderbird School of Global Management and serial entrepreneurs familiar with the financing dance–Neiss decided to push for what he saw as a solution to his problem: crowdfunding.