Key Takeaways
- • Proven Ventures, an Omaha-based venture capital fund and affiliate of Burlington Capital, plans to deploy the final $1 million of its $10 million fund into Nebraska startups, per an Omaha World-Herald report.
- • The fund intends to invest $250,000 to $500,000 per company in founder-led businesses that have moved beyond proving an idea, with a preference for B2B firms generating $250,000 or more in annual revenue.
- • Proven Ventures uses a "debt equity" structure in which debt is collateralized by the founder's equity, and founders buy back equity from the fund as they repay.
- • The fund has invested in 19 portfolio companies since its 2021 launch and expects to back two to three new companies with the remaining capital.
Summary
Proven Ventures, an Omaha-based venture capital fund, aims to invest the final $1 million of a $10 million fund established in 2021 into Nebraska startups, according to the Omaha World-Herald. The fund said it plans to commit $250,000 to $500,000 per company to "founder-led companies that have moved beyond proving an idea." It is particularly interested in business-to-business firms generating $250,000 or more in annual revenue, although the firm said revenue is not its only evaluation criterion.
Erica Wassinger, the fund's co-founder and general partner, said the $10 million was raised from high-net-worth individuals within and outside Nebraska who "shared the same ethos." The fund has invested in 19 portfolio companies so far, and Wassinger said it is looking for two to three new companies to support with capital and hands-on involvement.
The fund finances startups through what it calls "debt equity." Mary Blaney, chief financial officer of Proven Ventures, described it as debt backed by the founder's equity as collateral, with payment terms set with each founder. As founders make payments, they buy back equity from the fund under the collateral agreement. Wassinger said founders best suited to this structure are those who expect to create more value in their companies and want to retain more of that value over the long run.
Niklas Hüther, an assistant professor of finance at the University of Nebraska-Lincoln, described venture capital as private equity typically involving minority ownership stakes in young or growing companies, in contrast to buyouts, which are often leveraged.
Proven Ventures is an affiliate of Omaha-based Burlington Capital. One portfolio company, Centese, is an Omaha-based medical technology firm roughly a decade old that developed the Thoraguard device, used in recovery from open-heart surgery to drain fluid from the chest. CEO Randy Preston said the device is on the market, is used in about 60 hospitals nationwide, and has treated thousands of patients. Preston said the debt equity model helps the company raise capital on favorable terms and avoid taking funding when market conditions are less favorable.
Erica Wassinger, the fund's co-founder and general partner, said the $10 million was raised from high-net-worth individuals within and outside Nebraska who "shared the same ethos." The fund has invested in 19 portfolio companies so far, and Wassinger said it is looking for two to three new companies to support with capital and hands-on involvement.
The fund finances startups through what it calls "debt equity." Mary Blaney, chief financial officer of Proven Ventures, described it as debt backed by the founder's equity as collateral, with payment terms set with each founder. As founders make payments, they buy back equity from the fund under the collateral agreement. Wassinger said founders best suited to this structure are those who expect to create more value in their companies and want to retain more of that value over the long run.
Niklas Hüther, an assistant professor of finance at the University of Nebraska-Lincoln, described venture capital as private equity typically involving minority ownership stakes in young or growing companies, in contrast to buyouts, which are often leveraged.
Proven Ventures is an affiliate of Omaha-based Burlington Capital. One portfolio company, Centese, is an Omaha-based medical technology firm roughly a decade old that developed the Thoraguard device, used in recovery from open-heart surgery to drain fluid from the chest. CEO Randy Preston said the device is on the market, is used in about 60 hospitals nationwide, and has treated thousands of patients. Preston said the debt equity model helps the company raise capital on favorable terms and avoid taking funding when market conditions are less favorable.
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