LogoGarden buys Whoosh! from Franktown creators; FCA takes $2MM stake
By Milt Capps
LOGOGARDEN founder John Williams and his wife decided they wanted out of Carlsbad, California. So, not long ago they made their first-ever visit to the Nashville they'd been hearing about, bought a house that same weekend and then relocated here four months later.
That was in 2008. Williams, 56, recently announced that LogoGarden has accepted a $2 million investment from FCA Venture Partners, the management arm of Clayton Ventures. LogoGarden is generating revenue and is reinvesting proceeds in the company; Williams retains controlling interest, he confirmed when asked by VNC.
The major reason for taking the FCA investment is to pursue major partners for a premium-level service (adding, for example, Facebook page setup) and including white-labeling of its services for customers with large footprints, perhaps including the likes of FedEx Kinko's, OfficeDepot or others, he said.
LogoGarden's based service includes speedy online logo design, rapid business-card production, websites and hosting services for startups and other early-stage businesses. LogoGarden is currently a Delaware corporation, but will become a Tennessee C-corp, said Williams.
Williams, who's originally from "mostly Texas," had been funding LogoGarden, himself. He previously founded and successfully exited LogoYes, getting it to $1MM revenue, then selling to Web.com at "a good multiple," he explained.
Until his noncompete agreement with LogoYes ended in June, Williams had run LogoGarden only ex-U.S. Asked about competition from LogoYes and other sites, Williams expressed confidence in what he believes is his technology edge and "much higher-converting" business model. A visit to the LogoYes site this morning shows it is currently offering a 50 percent discount on new logos.
In addition, LogoGarden recently hired Rob Solberg and his team at Brainwave Studios and bought-out his Franklin-based Whoosh Interactive practice, creating a top-tier inhouse creative and production shop.
The Whoosh/Solberg acquisition also gives Williams the full team he needs to attract both investment and, perhaps three years down the road, a strategic buyer for an exit, he explained.
The LogoGarden team is further augmented by outside advisors, including Indianapolis-based Slingshot SEO (whose clients include ExactTarget and hhgregg); plus lawyer Norman Gillis and attorneys with both Neal & Harwell and Bradley Arant Boult Cummings. His accounting is by Smith Wiles; and, the firm has ties to several banks, including Fifth Third, he said.
Acquiring Solberg and team gives LogoGarden the depth of programming and software-development talent he needs to scale-up LogoGarden. LogoGarden has roughly 12 full-timers and will next hire one or more customer-service reps, Williams said.
The Whoosh move also allows Solberg and partner-wife Deb Solberg (a singer-songwriter) a clearer focus on their Franktown Rocks interactive mobile game platform for children under age 13.
Solberg told VNC that Franktown, with 1.5 million registered users, could use $250,000 in capital to move to the next level. Some potential Nashville investors have expressed interest over the months, said Solberg, but no deals, so far.
As reported by VNC in 2009, the Solbergs earlier raised about $1.2MM from friends and family, and had relocated to Nashville from Minnesota in 2004, after feeling the tug to do so, and after comparing living costs, weather and friends' reports on the city.
Though he worried about the local tech talent pool on arrival eight years ago, Solberg said earlier that as he's gotten more plugged-into Nashville, he's realized the situation's not as "dire" as he feared. VNC