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Venture Notes - February 7, 2024
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TODAY: 7Hills | Bunker | Alto | NashKats | NTC | iYOTAH | LRM | Nisolo | Herowear | Sage |
Borderless | Game | Relode | Swift | HMGp | ObjHealth | Krepling | LearnEV | FinSync-CS | IPOidea | Notes

Matthew Pettit

HC OPERATOR-centric SEVEN HILLS Capital this week filed the SEC paperwork on $125MM PE raise it disclosed in a December press release. In November 2023, Seven Hills announced it had reinvested in Katie Stevens-led Reliable Medical, a Franklin-based provider of complex rehab and mobility solutions, with no amount specified. Release here. Possibly related to that follow-on, issuer RM Investco II LLC filed for a $33.5MM raise, with Seven Hills the issuer's manager, in a filing by 7Hills Manager Matthew Pettit.

► BUNKER LABS, the nonprofit serving veteran and military-spouse entrepreneurs, most recently led from Nashville by U.S. Marine Corps veteran and Bunker Labs CEO Blake Hogan, recently announced its combination with Syracuse University's D'Aniello Institute for Veterans and Military Families (IVMF). Hogan is now a senior advisor to IVMF. No details of the transaction have been disclosed. Previous BunkerLabs coverage.

► ALT-FINTECH: ALTO CAPITAL FUND I-Kearney Jackson Fund I, a VC fund (fka Alto Capital) now linked to AltoIRA entrepreneur Eric Satz and Alto Securities CEO Scott Harrigan filed for creation of a $3MM VC investment pool. It's probably helpful to think of this Nashville-based outfit's move in the context of Satz's recent Forbes column on strategy in an era of evolving alternative investment instruments, and this detailed AltoIRA piece on Alts.co. Previous related VNC coverage.

► SPORTS RESTART-UP -- Arena Football returns to Nashville for season opening April 27, 2024, with Nashville Kats playing Minnesota Myth on April 27 at Nashville Municipal Auditorium. Lawyers-turned-Kats franchise founders CEO Tamara Dadd Alan and COO/GC Nancy Eckert. Former Tennessee Titans and LA Rams Head Coach Jeff Fisher is president of the franchise's football operations. The new franchisee filed Jan. 24 to raise $4.6MM to move the team forward.

Elise Cambournac

► NASHVILLE Technology Council CEO Elise Cambournac recently told an NTC gathering that the rebranding of its annual flagship event to NTC Innovation Summit (convening Sept. 20) from its former "NTC Analytics Summit" reflects NTC's steadily increasing emphasis on tech-sector innovation. NTC will remain oriented toward innovation achievements and requirements within enterprise organizations, rather than startup- or growth-stage businesses, she confirmed. Cambournac also emphasized that NTC seeks to support the work of Nashville Entrepreneur Center for new ventures. Asked about that, EC CEO Sam Davidson told VNC that he and Cambournac have discussed such matters informally, adding, "Both of us want to see more tech and tech-enabled startups in and around Nashville. We're currently brainstorming ways each of our organizations can grow that part of the ecosystem. Nothing firm yet." The two CEOs serve on each other's boards of directors (NTC board, EC board) VNC coverage of Nashville EC and of NTC.

VC INNOVA Memphis and other backers of iYOTAH Solutions Inc. reported raising more than $3.1MM to fund growth. SEC filing. iYOTAH's offering includes solutions that advance data-driven managerial decision-making by livestock producers. iYOTAH Co-founder and CEO Kari Spaan in Newnan, Ga., and Innova Partner Jan Bouten are associated with the filing.

Sam Lynch

► SAM LYNCH-led Lynch Regenerative Medicine LLC (LRM), based in Franklin, filed Feb. 2 on a $15MM equity raise, showing $3.7MM closed and reporting five undisclosed investors aboard. LRM's launch of the "biotherapeutics skincare company" was announced six months ago, with plans to leverage its proven growth-factor-related technology for treatment of certain skin conditions for improved aesthetics and healing. Associated with Friday's filing are company Founder, Chairman and CEO Lynch, who holds DMSc and DMD degrees; and, pH Partners, a boutique investment banking firm based in Austin. (pHP previously announced it had advised Lynch's former Lynch Biologics LLC in its 2022 sale to Geistlich Pharma North America. Among former advisors to the Biologics business was attorney Earl Douglas.) VNC's previous Sam Lynch coverage.

► NISOLO LLC was founded in 2011 in Nashville as a Certified B Corporation that offers handmade leather products through an e-Commerce platform that supports sales of handmade shoes, belts, bags and bracelets sourced from indigenous craftsmen. Nisolo's vision is shaped via its Sustainability framework. Its recent Form D filing with SEC shows a $5.2MM target. That target, plus targets of raises in 2016 and 2020 represented a cumulative aspirational target of roughly $22MM. the company is led by Founder-CEO Patrick Woodyard and CFO Rebecca Hansen. Its chief growth officer is Chris Rose.

Karl Zelik PhD

► Updated - LIFT: HEROWEAR LLC (HeroWear Holdings) reported raising a further $2.5MM in convertible debt from 31 investors. The 6-year-old Nashville company makes exoskeletons and pliable exosuits for use in military and industrial settings. VNC coverage of HeroWear. CEO: Mark Harris. Founder and Chief Scientific Officer: Karl Zelik PhD. Updated: HeroWear's 2023 testimonials reel (YouTube).

► TELETHERAPY PLATFORM: Sage Health Labs dba Swell focuses on connecting prospective patients from the U.S. military community with mental health care professionals. Its early emphasis is on serving members of families in the Clarksville, Fort Campbell and Fort Knox areas. The Founder-CEO is Rachel Edenfield. It filed in 4Q 2023 for a maximum $1MM crowfund convertible raise via MicroVenture Marketplaces. Swell says it previously raised $400K from Defy.VC and Fairwater Labs. In the past 18 months, the impetus for growth was accelerated by securing contracts with TRICARE. Swell's 2022 SEC filing for crowdfunding. Fairwater highlighted Swell here.

Chris Martin

► CHRISTINA 'Chris' MARTIN, a serial Creative tech entrepreneur, advisor and philanthropist, was at the center of VNC's 2021 report on her "HODL" television series production, and she popped-up this week in a filing for Nashville-pinned Borderless Entertainment Inc.'s crowdraise (SAFE, via OpenDeal Portal), carrying an increasingly common target range of $50K-$5MM. In the extensive documentation, the business is described, in part: "Borderless Entertainment develops film and television. Acquiring rights to projects at various stages, subsequently selling rights to produce and/or distribute the project at later stages, Borderless generates revenues and net profits from these licensing activities... Borderless Entertainment enters the market as an independent film and television company with an advantage in navigating Web3, Web4 and Generative Artificial Intelligence ("AI"). In particular, the application of cutting-edge AI technologies to the entire creative development process creates Borderless' strategic advantage bringing film and television content to market." A valuation cap of $15MM is mentioned, as is the fact that much of the proposed work would be driven from "LA/NYC/London." Martin is CEO, director and founder of the issuer. Among other interests, she is president and co-founder of Web3 blockchain play Sator, which she discussed in this interview (YouTube). She notes in the filing that she was recently named a juror for the September 2024 Nashville film festival. Her LinkedIn is here and an industry bio here.

► GAMECHANGER SYSTEMS INC., Cleveland, Tenn., announced it completed a growth-capital financing round, on the heels of its earlier Seed raise. Jerry Stout is CEO of the company. No details have been broadly disclosed regarding either of the company's capital rounds, all of which seem targeted toward expanding distribution and major test-market placements of automated pop-up kiosks that are placed in groceries and other retail shops for convenient access for gamers and parents seeking to buy/sell/trade games via instant transactions, with mobile-ordering options. VNC research suggests EastTN-based Arne Henderson has been a key industry advisor. According to a recent press release, Nashville-based Frost & Co., a boutique investment bank, represented GameChanger in the most recent financing. Background: 2020 release.

RELODE LLC, the 10-year-old Brentwood-based peer-sourced healthcare recruitment platform recently filed for $1MM debt offering. They made a similar move last July. The company, which has filed on 8 transaction since 2015, is led by CEO Peter Clare, CFO Brandon Jarnigan, CAO Cabot Hyde and CGO Neal Bhamre. It was founded by former CEO and now Director Matthew Tant and Joe Christopher, with the latter remaining its CTO. Its backers include Heritage Group, Frist Cressey Ventures, Gin Lane, et al. Its SEC stack is here. Crunchbase here. Previous Relode coverage.

► SWIFT MEDICAL INC., an 9-year-old Toronto-based company that offers digital wound-care technology, announced that in 2023 it completed a USD $8MM capital raise, led by BDC Capital's Women in Technology Venture Fund and funds managed by Virgo Investment Group, with participation of other new and existing investors, including Nashville's Claritas Capital and Louisville's Chrysalis Ventures. The latest raise brought Swift's total capital-in since inception to at least $54MM. PCJ news here. Swift release here.

► MEMPHIS-based Honeycomb Management Group (Honeycomb Holdings) filed for a $2.7MM raise, with $1.8MM reported in from two investors at filing. The healthcare consultant for operational, HR, quality, patient monitoring and other functions is led by CEO Bill Breen.

Colleen Hoke

OBJECTIVE HEALTH INC. announced receiving expansion investment of undisclosed magnitude from PE Vitruvian Partners to step up its business of increasing participation in clinical trials by practicing physicians. SEC filings by Objective during 2019-2022 indicated cumulative fundraising goals of about $25MM. Objective's tech solutions help match physicians with relevant trials and supports efficient management of trials' workflows, according to its press release. The co-founders, who are respectively the company's CEO and chief medical officer, are Colleen Hoke and Don Lazas MD. Objective was named "Market Leader" in the healthcare sector by judges in Nashville Entrepreneur Center's 2023 NEXT Awards. Vitruvian was represented in a related press release by Partner Sophie Bower-Straziota. Incumbent investors include BIP Ventures (Austin Poole) and Frist Cressey Ventures (Chris Booker). Vitruvian's performance has at times been ranked by some observers as among the Top 1% of GPs, globally. In the latest transaction, Objective was advised by attorneys with Nelson Mullins and by members of Nashville-based i-banker OM Partners, which was cofounded last year by Nick Carteaux, who previously spent two decades with Brentwood Capital Advisors. Vitruvian was advised by LEK, FTI, Cain Brothers and Milbank. Previous ObjectiveHealth coverage here, and Lazas coverage here. At inception, the early-stage company was known as ObjectiveGI Inc. and Objective GI LLC.

► CHATTANOOGA-based Krepling Inc., the no-code e-commerce platform created by co-founding brothers Liam Gerada, age 23, and 20-year-old Travis Gerada announced raising $3.3MM Seed, from investors they say include Launch, Brickyard, Front Porch Ventures, 11 Tribes Ventures, Colabora Ventures, and Broadshade Investments. VNC research suggests a portion of Krepling's outside funding came via Launch founder Jason Calacanis's "Jason's Syndicate," which in 2022 made a Krepling-related filing for a $188K raise. That filing included an SPV administrator, Jeremy Neilson, now associated with SPV Concierge. The roots of Krepling manifest as early as 2018. That's when the siblings were venturing into e-commerce in the Republic of Malta, a member of the British Commonwealth. It was there that they began developing e-commerce assets that would lead them to Krepling. By 2022, they joined the Brickyard portfolio. See podcasts at SaaSClub and at Codestory. Release here.

► AS TENNESSEE looks for talent in its Automotive-Electric-Vehicle sector, it OEMs and others might take a look at Kentucky-based LearnEV, which offers an e-commerce training program for educating technicians in the combustion and EV spaces. Revenue-producing LearnEV is offered by Lexington-based Independent Truck Repair Group (IPRG), which VNC research indicates is led by founder John Joseph Stoeckinger, also a principal in an automotive parts retailing business. The business seeks up to $124K in a crowdfund push filed by Executive Chairman Douglas Clemons, an experience financial pro.

Enoch Elwell

► CO.STARTERS INC. was born in Chattanooga nearly a decade ago, with a mission of cultivating business ownership and entrepreneurship, first locally, then nationally. Though no details have been divulged -- multiple informal social media posts about the deal, itself, seem to have been deleted -- at some point in the past year or so, Co.Starters' for-profit consulting- and licensing-heavy business and-or other assets thereof were quietly acquired by Atlanta-based software and services provider FINSYNC, a 13-year-old business founded and backed by CEO Tucker Mathis. The acquiring company's CFO is former Equifax division CFO Michael Thompson. Its board secretary and president for payroll software functions is Dave Olsen. Former CoStarters CEO Jose Alfaro, based in Fort Worth, is now managing director of FinSync's CoStarters division. VNC research indicates that most of the CoStarters team moved to FinSync. Founder and former CEO Enoch Elwell, now 36, remains based in the Chattanooga area with his wife and four children, and remains engaged during the transition with FinSync. Elwell also continues to participate in advocacy and advisory functions related to affordable housing and economic place-making, and he holds interest in several businesses, including Treetop Hideaways. VNC research indicates CoStarters' Chattanooga-based advisors during the FinSync process included the company's long-time attorneys with Chambless Bahner Stophell and accountants with Henderson Hutcherson & McCullough PLLC. CoStarters (originally known as Get Started) was advised during the transaction by Frank Williamson, founder of Oakland Consulting and a long-time member of the board of Launch Tennessee. Multiple NGOs among this state's regional entrepreneur centers, community development groups, et al, now contract or have contracted with CoStarters. We've found no information regarding FinSync's TN footprint, beyond Costarters. Earlier CoStarters coverage.

► WE'RE NOT ALONE in relishing the notion of an IPO resurgence. Hypothetically, and without any diligence or outside encouragement, our ideation easily points to, for example, two vehicles that share many of the same backers, and which seem to be garnering the kind of curb appeal that could pave the way for a drive toward listing: Main Street Health, backed by Frist Cressey Ventures, strategic partners and others, filed with the SEC in December 2023 for a roughly $190MM raise. Three years ago, it filed for a roughly $26.6MM raise. In October 2023, the company announced it had raised $315MM in new capital, through a process that reportedly attracted 12 investors. That same month, the company was among those recognized for Excellence in Patient Experience by Vanderbilt University Medical Center, among hundreds of clinicians and clinical teams. According to the FCV site, Main Street is "a value-based healthcare company focused exclusively on serving rural Medicare Advantage members using a risk-bearing care delivery model in partnership with local providers and pharmacies." FCV portfolio companies Main Street and Carebridge (mental health care and other benefits) have been widely reported to have negotiated Unicorn $BN-plus valuations at one or more points. Four years ago, VNC turned a speculative eye to Frist Cressey activity that turned-out to be CareBridge's first stirrings, in this piece. We note that Nashville Capital Network and-or affiliates were among early investors in Main Street.

► FINTECH: Update on this week's Congressional hearing on Bank-Nonbank relationships and related, here. Nashville EC-based statewide Project Fintech's inaugural initial accelerator cohort members listed here. Separate Project Fintech site here. Other VNC fintech coverage.

► KICKS: KOMBUCHA: Walker Brothers Beverage Co., Nashville, aims for a roughly $4MM raise and had 50 investors aboard, as of its Jan. 31 filing. Related press.

All stories in reverse-Chron order, HERE.
'Venture Notes' roundups in reverse-Chron order, HERE. VNC

. Last edited 10 February 0843 0633

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