Steve Kiene, Patrick Smith and Doug Durham, who founded the software development fund in 2010, describe themselves as nerds with money. All three have extensive experience in business and technology and share a love for Nebraska. They believe that the state’s location and economy make it a fertile field for new tech companies. Investors apparently agree.

In October, Nebraska Global announced that it had exceeded its goal of raising $30 million to invest in new and emerging software companies. The founders decided to cap the fund at $37.3 million. Investors in the Nebraska Global Fund include Capricorn Investment Group, the University of Nebraska Foundation, Nelnet and Jeff Raikes, CEO of the Bill and Melinda Gates Foundation.

“To have key foundational Nebraskans as investors in addition to well-known technology entrepreneurs is a testament to the strength and quality of Nebraska and of our strategy to create long-term sustainable value within Nebraska and the Midwest,” Kiene said in a press release.

In its first year, Nebraska Global has funded three companies: ECH3, Don’t Panic Labs and ICORA, and is working with other companies in which it will make investments ranging from $100,000 to $5 million.

A Different Entity

But don’t confuse Nebraska Global with any venture capital fund.

“We are an entirely different entity,” said Tom Chapman, vice president at Nebraska Global. “Lots of venture capital is based on the idea of a quick return, growing something then selling it. We are blessed with terrific investors who believe in investing in lots of great software companies rather than just one, then selling it and moving on to company number two.”

To achieve its mission of creating long-term economic development in Nebraska through for-profit software companies, Nebraska Global provides more than just funding. In fact, it turns away entrepreneurs who are only interested in capital. On its website, Nebraska Global describes how it wants to entrench itself in the businesses it funds so it can bring expertise and operational assistance to the table along with money.

“We have real development muscle,” Chapman said. “Some people say they can offer development assistance, but we really mean it. We have 45 people with development and domain expertise. We have a great technical acumen.”

Chapman used the example of a contract to demonstrate how Nebraska Global works. Other places might just provide a contract template that people can copy, he said, but Nebraska Global also provides the expertise behind the form.

Nebraska Global Vice President Tom Chapman speaks at Cowtown to Boomtown in Iowa City.

The other thing Nebraska Global offers their startups is a deep network of industry contacts. “We provide connectivity, not just advice,” Chapman said. “We can help entrepreneurs get to the best customers locally and nationally as soon as possible.”

When an entrepreneur partners with Nebraska Global, there is generally a three-phase process that includes working with a technical group to build out the alpha or beta product, developing a marketing program and beginning the sales cycle, then strategically building the team that will move the startup forward.

In Search of Domain Expertise

Nebraska Global is not a fit for every software startup, Chapman said. The fund is looking for applications with short sales cycles and real-world demand.

“We are looking at companies to discover where we can be powerful together,” he said. “We are looking for domain expertise. We want people who are experts not just in their industry, but in understanding what the customer is really wanting. To be able to say, ‘I’ve sat on the other side of the table and I’ve seen the solutions people brought me and I know what is needed,’ that is powerful.”

In June, Nebraska Global announced an investment of $1.5 million in EC3H, a Lincoln-based company established in 2009. EC3H has developed a platform that helps creditors collect money owed from the estates of deceased debtors. In a press release announcing the partnership, Smith said that EC3H “fits nicely where we love to operate, leveraging technology to solve complex problems to generate value for our customers.”

Chapman said that EC3H presented a big market opportunity, an exciting prototype and a great management team that made it a good fit for Nebraska Global. ICORA, the second company Nebraska Global invested in, has deep expertise in Microsoft Dynamics, a market Nebraska Global is eager to explore, Chapman said. ICORA’s first product was the result of research and development at Don’t Panic Labs, the first company funded by Nebraska Global.

Garden Instead of Hunt

Chapman, who came to Nebraska Global in August from the Omaha Chamber of Commerce, said he was attracted to the company’s strong team culture. “Most entrepreneurs don’t recognize the power of a great team, but they (Nebraska Global) really got it.”

Chapman also believes in Nebraska Global’s vision of developing the Nebraska economy through gardening homegrown expertise rather than hunting smoke stacks.

“Hunting a Google or other big business to move to Nebraska takes a lot of resources and is a one-in-a-hundred shot,” he said. “Growing our way to success makes a lot more sense to us. We are also growing wealth in the community because most of the time, the entrepreneurs are here and we are not dependent on out-of-state owners.”

Chapman encourages new and emerging software companies to consider Nebraska Global as a funding partner.

“We are pretty expensive capital if you just want an investment,” he said, “but if you want technical expertise, we might be the way to go.”

Recent News:

Nebraska Global Investment Fund Raises $37.3 million

Nebraska Global and the State of Venture Capital in Nebraska

Startup lessons and insights from Nebraska Global and Agile Sports founders

Nebraska Global wins Walter Scott award for entrepreneurship

Nebraska Distinguished Entrepreneur Award Winners

Nebraska Global venture capital fund unveiled, website goes live

Inc and Fast Company magazines have recently touted the program as a top entrepreneurship program in the nation. PIPELINE has also been recognized by State Science Technology Institute CEO Dan Berglund as “the next evolution of entrepreneurial capacity building in the United States.” “An immersion experience,” this program offers mentorships and expansive resources to identified, high-potential entrepreneurs to enable their growth. PIPELINE alum Rhythm Engineering recently made the list of Inc Magazine’s 500 fastest-growing companies. Reggie Chandra, CEO of Rhythm Engineering, explains his visions for the future and how PIPELINE has been a key to his company’s rapid growth. (http://vimeo.com/28072982)

Nebraska entrepreneurs now have the chance to apply for the regional class that will be selected for 2012. The deadline is Oct. 24. “We are eager to work with PIPELINE over the coming weeks to identify Nebraska entrepreneurs, mentors and partners who share this drive to foster innovative companies in our region,” said Dr. James Linder, president of the University of Nebraska Technology Development Corporation.

Ideal candidates should already be running their venture and entering a phase where a year of intense resources, skill building and netwotk-building will accelerate their growth and scale their venture. Applicants must be willing to spend the time and effort necessary for the fellowship experience. An informational meeting on PIPELINE will be held on Oct. 14 from 3:30 to 5:30 p.m. at the Urban Wine Company in Omaha.

Also, more information on the PIPELINE  program is available at www.pipelineentrepreneurs.com.

The fund was oversubscribed – closing at $37.3 million far exceeding the original target of $30 million. Ultimately, the fund turned away an additional $10 million to ensure a strategic fit with its investment approach.

Steve Kiene, co-founder of Nebraska Global, noted: “We are extremely pleased to have not only completed our funding, but to have far exceeded our goal and expectations in both dollars and quality of investors. To have key foundational Nebraskans as investors in addition to well-known technology entrepreneurs is a testament to the strength and quality of Nebraska and of our strategy to create long term sustainable value within Nebraska and the Midwest.”

Investors in the Nebraska Global Investment Fund include Capricorn Investment Group, the investment arm of Jeff Skoll (former President of eBay), the University of Nebraska Foundation, Jeffrey S. Raikes, Nelnet, co-founder Kiene and approximately ten others. All of the investors have Nebraska ties and have expressed a commitment to growing software businesses in the region.

Capricorn Chief Investment Officer, Stephen George, commented, “As a Nebraska native and resident, I believe the next decade in technology development can include great innovative business success from Nebraska and the heartland. The region has a unique pioneering and hard-working spirit, is strong in math and science, and the Internet provides a mechanism for companies here to compete on a global basis. Capricorn is excited to be an investor in Nebraska Global and it will be an important capital and operational engine for terrific entrepreneurship here.”

With regards to the other investors, Kiene explained, “We have a group of investors who have built or run world-class businesses and who invested because they understand and agree with our approach of building sustainable businesses, long term.”

Nebraska Global intends to invest its funds in multiple companies with target investments from $100,000 to $5 million. Nebraska Global has already invested in three companies — Don’t Panic Labs, EC3H and ICORA and is currently working on finalizing three others. One investment is an outside deal and the other two are internal ideas. In order to invest in and create great software companies, the company will leverage its technical aptitude, particularly on Microsoft platforms.

The company is seeking new ideas and projects to start and in which to invest.

“We are actively looking for solid business ideas, great employees, and determined entrepreneurs,” Kiene said.

With the size of the fund, Nebraska Global believes that it will be able to create a lasting impact on Nebraska and its technology landscape.

Nebraska Global is a software investment company based in Lincoln, Nebraska. The company invests only in new or young software companies. Generally, the company is seeking partners where the company can leverage its capital as well as its technical competence. Learn more at NebraskaGlobal.com, or learn about the companies in its portfolio at DontPanicLabs.com, ICORA.com, or EC3H.com.

Recent News:

Nebraska Global and the State of Venture Capital in Nebraska

Startup lessons and insights from Nebraska Global and Agile Sports founders

Nebraska Global wins Walter Scott award for entrepreneurship

Nebraska Distinguished Entrepreneur Award Winners

Nebraska Global venture capital fund unveiled, website goes live

In college Wegener took a part-time job to pay the bills by working at a local salvage yard. During that time he realized the salvage yard desperately needed a way to inventory all that it had. This ultimately led to the eventual startup of ISoft Data Systems and an innovative marketplace business model.

Soon after ISoft developed its first version for that first salvage yard, the company soon realized the auto salvage industry was overrun by competition, and that what had been a $20,000 software package was now down to $1,000. Through talking directly to customers, ISoft realized there was a small side industry that was nearly untouched: the heavy truck salvage industry.

Over the years ISoft has taken a majority piece of this market. Since ISoft has such a high market penetration, it has started to innovate in several different areas to continue growing and serving its clients better.

Listen to this informative talk by Wegener and also be sure to check out two other talks by Joe Petsick of Proxibid and Paul Eurek of Xpanxion.

Startup Weekend Omaha is back.  From Sept. 16-18, business people, creatives and developers will converge at the University of Nebraska at Omaha’s Mammel Hall for a unique experience. The weekend is open to anyone with a business concept, or anyone who wants to collaborate with other entrepreneurs in a creative environment.

The weekend begins with business pitches on Friday evening. Attendees then form teams and spend the next 48 hours designing products and launching startups. The weekend culminates with business demonstrations on Sunday evening. According to Startup Weekend’s website,  36 percent of the businesses launched will still be going strong after three months and 80 percent of participants plan to continue working with their startup team after the weekend.

Startup Weekends are held in communities around the world. Omaha software developer Corey Spitzer brought the event to Omaha after attending a Startup Weekend in Kansas City. This will be the third Startup Weekend in Omaha. The weekend events give business dreamers the opportunity to build connections, collaborate with a creative team and get feedback from business mentors and investors.

“Startup Weekends mimic the constraints of experience in the real world,” said Grant Stanley, CEO of Contemporary Analysis and one of the organizers of the Omaha event. In a short amount of time and with limited resources, entrepreneurs can test their ideas and discover if they are viable.

Zaarly, a reverse Craigslist site that allows people to post goods or services they need and what they are willing to pay for them, was birthed at a Startup Weekend in Los Angeles last February. Founders Eric Koester and Ian Hunter built their prototype, won the Startup Weekend competition and impressed investors enough to secure funding. The site went live in March and processed more than $10,000 in transactions in its first 48 hours.

Spitzer and Stanley stress that you don’t have to have a business idea of your own to participate in Startup Weekend. You can come and be part of team that works on someone else’s project. At whatever level you participate, organizers say you will leave with inspiration and lots of new friends.

“You get to work together with people you don’t normally mix with,” Stanley said. ”Students, aspiring entrepreneurs and anyone who likes ideas should attend.”

Registration includes meals and all of the coffee you can drink.

William Shakespeare once famously asked: What’s in a name? For local non-profit organization Community CROPS, there’s a lot. CROPS — an acronym for Combining Resources, Opportunities and People for Sustainability – has a mission to bring these values to the local community, thus, Community CROPS.

It’s a lofty mission, but one that Community CROPS tries to live up to by offering workshops, education programs and community gardens designed to help locals both get into the business of growing food and enjoying the satisfaction of knowing where their food comes from.

Anyone from the backyard hobbyist to the person harboring serious farming ambitions can get involved.

“People can participate at whatever level they want. Our community gardens are smaller plots where families are provided the resources to grow food,” Leslie Pillen said. “Our growing farmers program is the next level. Folks have large areas of land and they’re also receiving training, support, marketing and technical assistance to start a small farming business. So they’re operating with the goal of generating an income.”

Pillen manages the growing farmers program, which is designed to help beginning, immigrant and limited-resource farmers who want to expand their horizons by starting their own local farms. According to Pillen, one of the most effective techniques taught in the growing farmers program is direct marketing, where farmers sell their locally grown crops as high-quality luxury goods to a niche market of local consumers.

Leslie Pillen teaching a drip irrigation class

“We focus on helping people locate and connect to more direct market opportunities where they’re able to receive the full price for their product.” Pillen said. “So when you go to a farmers market you’re able to sell your tomatoes for $2.50 to $3 a pound instead of going through one of the wholesale regional or national distributors where you might get 40 cents a pound. So it’s smaller volumes but a higher profit per volume.”

By using the direct marketing approach, area farmers can operate successful farms using much less land than they would otherwise have to. And by using less land, farmers greatly reduce or even eliminates the need for expensive farm equipment like tractors and combines. Thus in one fell swoop the direct marketing approach taught in the program eliminates two of the largest barriers that prevent people from entering the agricultural business.

Potential candidates for the three-year program first need to complete an intensive small farm business training workshop focused on marketing crops specifically to sell to direct markets like farmers markets and local restaurants. The growing farmers training program, which runs from January to April, also teaches business and financial planning and also prepares potential farmers for the rigors of dealing with taxes and marketing their crops. For some gardeners thinking of going pro, the intensive four-month course serves as a wake-up call, showing them that managing a successful small farm takes a lot more than just a talent for horticulture and a little spare time.

“Just because you have the most beautiful tomatoes on the block doesn’t mean you have the sales outlet for them,” Pillen said.

A lot of people who take the growing farmers class end up deciding that being a food entrepreneur is more of a time commitment than they can handle. They end up leaving the program with a greater appreciation for the hard work that goes into making it in the farming business and a renewed commitment to supporting local growers.

In addition to teaching farmers the finer points of the trade, Community CROPS also participates in another direct marketing program called Community-Supported Agriculture, commonly referred to as CSA. Essentially people buy shares of a farmer’s harvest and then get a fresh box of produce every week throughout the growing season.

Community CROPS CSA box contents

CSA has the two-fold benefit of offering a vital market to local growers and also acting as a kind of crop insurance. Since the share of the crop is bought before the season starts, small-scale growers aren’t completely wiped out if their crop is ruined by inclement weather like hail storms, flooding or drought. The benefit for the CSA consumer is that they can count on having the freshest produce in town as long as crops are being harvested.

Community CROPS also offers a variety of workshops on topics ranging from cooking fresh vegetables to building agricultural structures like high tunnels, cold frames and row covers which help to extend the growing season for crops. Information on these and other classes as well as on the CSA and growing farmers program can be found on the Community CROPS website at http://www.communitycrops.org/workshops.

With farmers’ markets blooming and themes of “Go Local” sweeping grocery stores, it is prime time for budding food entrepreneurs to showcase their product’s originality or promote grandma’s best recipes. Luckily for Nebraska food entrepreneurs, the nation’s only extensive food entrepreneur assistance program is nestled in their own backyard on the University of Nebraska-Lincoln’s East Campus.

The Food Entrepreneur Assistance Program, within the Food Processing Center, is the ultimate source for assistance through all phases of establishing a food business. After attending the “Recipe to Reality” seminar, a workshop providing entrepreneurs with a basic understanding of crucial issues in a food business, the individual is ready to begin “Product to Profit.”

The product owner meets with consultants one-on-one, taking about a year to complete the program. The program helps to uniquely tailor each entrepreneur’s creations by providing insight into the food industry and promoting a competitive edge within the marketplace.

Jill Gifford, Manager Food Entreprenuer Assistance Pgm

Program manager Jill Gifford said “Product to Profit” provides professional input the entrepreneur may not have considered. Taking a product to the market is more than slapping a name on a jar and giving it to the store for sale. The food industry has many requirements and regulations a product must meet before being sold in stores.

“It helps them to think about everything, and it helps to prevent mistakes such as getting labeling incorrect with the FDA,” Gifford said. “Any small business takes a lot of work; the food industry is all very regulated. Our services provide help with this to make everything easier.”

The program team of food industry experts, including food scientists and business consultants, counsel the individual in business development, product development, labeling and regulatory compliance, processing facility location, product pricing and promotional material development. The team works for the success of the food product by advising the entrepreneur to make educated decisions including proper planning and execution. This personalized form of food business counseling is not limited to Nebraska residents alone.

“It is the only center in the country that is this extensive, which is why we get companies from all over the country. It is a unique program,” Gifford said.

Julie Reiling, Food Scientist, Sensory Analysis Lab Panel

Not only does the program provide insights into the complexities of owning a food business, it also looks to give new food products the upper hand in being competitive. According to Gifford, in the food industry it not only takes a great idea, but great marketing, promotion and business concept to survive. “Product to Profit” strives to implement these intangibles to enable the prosperity of the product.

“There is a lot of competition,” she said. “It takes a competitive edge to be successful. Have a really quality product, have quality packaging, have a willingness to market and promote so the consumer understands the uniqueness of the product.”

Local food entrepreneur James Gustafson has found “Recipe to Reality” and “Product to Profit” to be invaluable in the creation of his food endeavors with Pur Java, a coffee product.

“The [Food Processing Center] is a gold mine of expertise and knowledge that can be utilized for any food industry questions.  The resources that are available from marketing outlets, production issues, nutrition information and labeling are all areas of knowledge the FPC can answer for anyone starting a new food-related business,” he said.

Whether the food entrepreneur is a Nebraska native or a resident hundreds of miles away, the Food Entrepreneur Assistance Program puts companies on the right track. According to its website, FPC prides itself on the ability to take “ food from thought” to “transform ideas into reality with passion, flavor and innovation.”

[For more information about the UNL Food Processing Center, check out their Resource Listing right here on NebraskaEntrepreneur.com.]

Collaborative Work Spaces and the Accelerating Effects on Business

Matthew Wegener, President & CEO, ISoft Data Systems and Turbine Flats

Turbine Flats is an idea community and home to 10 early stage and start-up businesses. In this session, Matthew Wegener will discuss the businesses that are taking root at Turbine Flats today. He will explain how they are now growing into the economic powerhouses that will provide passion, wealth and employment for the Lincoln of tomorrow.

Steve Frayser, President, University of Nebraska Technology Park

Steve Frayser will discuss the business incubation services for technology-based business startups that The Technology Development Center at the University of Nebraska Technology Park helps to provide. Frayser will give an overview of incubation services, the characteristics of growing firms and the correlation between business survival rates and the involvement in business incubation.

Megan Hunt, Owner, CAMP

Megan Hunt, founder of Omaha’s first creative coworking space CAMP, shares her adventures in coworking and explains how collaboration at work enhances productivity, community, and creativity, and most importantly, happiness.

“Management experience in a startup a lot of times is lacking, as is industry experience,” said Joseph Knecht, managing director of Interactive Information Research Development. “It can really help to surround yourself with people who share common interests, common goals, common challenges. With all those variables in play, that community environment helps cultivate a culture of success.”

Started by two UNL professors in 1997, i2rd grew quickly over the next several years. Eventually, the company moved to the Tech Park in 2001, the same year Knecht came on board. Although i2rd graduated from the Tech Park in 2005, Knect said the experience accrued over those four years has repeatedly proven itself invaluable.

“There was no boundary on work hours, so we were pretty much there all hours of the night, 7 days a week,” he said. “Through casual talk with the other business owners, we helped each other build our companies with shared experience and know-how.”

In addition to providing office space where these frequent meetings of the minds took place, the Tech Park also brought in experts to answer the more nuanced questions of its residents. Topics ranged from HR quandaries to marketing woes, but Knect said the Tech-Park-procured specialists were able to elaborate and explain the most minute details of running a business.

Knect also praised the Park’s creation of an atmosphere where failure is transformed into a learning experience.

“I think a major challenge for a lot of startups and entrepreneurs is that there are a lot of great ideas, but people aren’t sure how and to whom to market them,” he said. “The park allows you to experiment and try out multiple ways of doing business. The environment allows you to succeed and fail, with the hope of finding something that really works. i2rd learned how technology, the web and business all come together.”

Those four years of education are already paying high returns. In 2006, i2rd was named the Fastest Growing Business by the Lincoln Chamber of Commerce. And the firm has launched two more startups in that time: Lincoln-based advertising service provider Vipa Solutions and Provider Trust — an online connection tool for health care professionals — located in Nashville, Tennessee.

“One of the most important things we learned is to never accept how you are, keep trying to build — a stagnant organization is an organization that is dying,” Knect said. “And incubators help facilitate that change. I’m not saying it’s a home run, you go to an incubator and you’re done, but it gives you a much better change of being successful, going through that process with all those like-minded individuals.”

Though two decades seems like quite a ways off, the development of the technologies needed to sate mankind’s growing appetite must begin long before then. In order to achieve this end, Neogen is bringing as many talented entrepreneurs and corporations as it can to the table. One of those companies is Lincoln-based genomics (the examination of animals for traits with economic or aesthetic advantages) firm GeneSeek.

“Food safety is part of food security, and genomic tools can be used to select animals and plants that contribute to better food production,” said Abe Oommen, GeneSeek’s former CEO and co-founder, as well as NeoGen’s current general manager.  ”This is the interest Neogen had in GeneSeek.”

Neogen acquired the agricultural biotechnology service provider in April, but GeneSeek has been around since 1998. During its infancy, it was able to grow and prosper thanks to laboratory space provided by the University of Nebraska Lincoln Technology Park.

“It is hard for a startup company to build lab space,” Oommen said. “This is the big contribution of the Tech Park: a niche for technology based companies.”

It was this Technology Park lab space that helped GeneSeek firmly plant its feet on the cutting edge of technology, allowing the high-tech corporation to provide the best possible products and services to its customers. During its time at the Tech Park, GeneSeek diversified its service portfolio to include SNP profiling, marker assisted selection (MAS), disease diagnostics and identity management.

Single nucleotide polymorphism profiling is the practice of predicting disease and trait predisposition based on readouts from specialized computer chips. On a similar highly technical note, marker assisted selection entails scrutinizing advanced genetics information to make informed breeding decisions. GeneSeek also offers Real-Time pathogen detection and confirmation in a wide variety of animals.

By using these technologies and more, GeneSeek offers its customers the ability to accelerate the process of natural selection. Through selective breeding, livestock producers are able to phase out undesirable traits — such as proclivity toward certain illnesses — while keeping beneficial attributes (such as outstanding meat quality) within their animals’ collective gene pool.

As GeneSeek continued to expand, it caught the eye of Neogen. Like a captivity-hatched chick, GeenSeek was looking to move beyond its incubator and continue growing. The partnership with Neogen seemed a perfect fit.

In short, the merger was all part of GeneSeek’s greater plan.

“Always have a vision for what your company should be, and work toward that goal,” said Oommen when asked for advice to dispense to startups seeking incubation. “And don’t do anything that you don’t know very well – start a company that depends on your skills and abilities.”