July 19, 2013

Take a swim in The Guppy Tank

Move over, business sharks – the guppies are coming to Denver.

The Guppy Tank, a less-intimidating and more realistic version of the ABC television show “The Shark Tank,” is bringing its angel investors to Denver for a one-day funding event Sept. 12 at Galvanize, a co-working space for local entrepreneurs.

Denver is hosting the first Guppy Tank event outside of California for the Newport Beach, Calif.-based investment firm, and it will be the first event open to the public, said Darrin Ginsberg, CEO and founder of The Guppy Tank, an event-based capital provider.

“I have a [financial] interest in three companies in Denver at the moment…and I really like the business community in Denver,” Ginsberg said. “We are branching out from our backyard, and we thought Denver was ripe to have Guppy Tank come to town.”

Unlike the fighting that goes on among investors on “The Shark Tank,” the Guppy atmosphere is friendly and investors will hear business pitches as a group. And it won’t be on TV, although a video of the event likely will be posted on the firm’s website.

Another big difference, Ginsberg said, is that entrepreneurs who are funded will get investors who actually care about their business, Ginsberg said “We’re deal guys. I can’t imagine that a $50,000 or $100,000 investment is that substantial to [billionaire] Mark Cuban,” he said. “For our $25,000 to $500,000 investment, we will be as active as we need to be.”

But Guppy Tank investors never buy a majority stake in the companies they invest in, he said. Some-times they’ll invest in a stake as small as 1 to 5 percent. And they give the business owners the choice of either a private-equity investment or a loan.

“Some people don’t want to give up any control in their business. They’d rather take out a loan than give up 30 to 40 percent of the business,” he said. Business owners seeking funds through The Guppy Tank must operate a for-profit organization that has been engaged in its current business activity for at least one year. “We won’t do a true startup,” Ginsberg said. “It has to already have started up and they are getting some cash flow. They need to have shown that the business model works.”

And they’re not looking to invest in any certain kind of business. “We’ve funded car washes, car dealerships, dress stores, fire extinguisher sales companies and online training courses,” he said. Candidates have until Sept. 8 to submit an online application to participate in the event, which requires participants to pitch the viability of their business concepts to a panel of investors and lenders.

To qualify for funds, local entrepreneurs will need to effectively identify the challenges they face, explain what makes their businesses unique, how they would utilize the funds and how their team is poised for success. The Guppy Tank and its sponsors will make investments from $25,000 to $500,000 per business.

Source: Denver Business Journal