Interviewed by Kevin Kimle: Excerpts
Kevin Kimle: What's one of the most interesting deals that you've ever made and, and why was it interesting? Nick Evens: Our first true venture capital investment was in 2010, in Des Moines-based Dwolla. Ben Milne is the entrepreneur and founder and he's a great guy and a very smart guy. If anyone ever wants a seminar on raising money, Ben should be the lead-off speaker. He’ll say raising money's a full time job and it's exhausting. We invested in Dwolla’s Series A round. It was funny when Ben was making his pitch, explaining how his person-to-person exchange of money would work, without having to use cash or credit cards. In other words, I could, if you and I had lunch and we were going to split the tab, I could just send you money to you using my phone. Ben explained how Dwolla was going to change the world, and we're going to get rid of cash and cards all over the world. We had decided going into the conversation that Veridian needed to be a part of this movement somehow, to investing in fintech to see what was going to happen and be a part of that change. KK: And then you find a business to invest in that’s based in Iowa!
NE: Then we find one based in Iowa who wants to hang out with a credit union, which was unique. Ironically, no banks would invest. I remember our first time meeting Ben vividly. Our CEO said, gosh, Ben, we just don't get it. We don't understand the concept of people not carrying cash or not carrying a card. Ben replies that it doesn't matter if we get it or not, as we’re not Dwolla’s target demographic, millennials, the 18 to 35 market. So Ben is pitching us for investment to help get his company started and he told us that our executive team isn’t the target demographic. We look back and we just laugh about that today. The fact that we still invested after that says a lot for Ben. It's a credit to him that he had a compelling story and a unique business idea. Also to Ben’s credit, Dwolla’s made a couple of pivots, hung in there, and raised a lot of money from both coasts and from the Midwest. KK: And so you’ve invested alongside Andreessen Horowitz? NE: Well, they were the C round and Union Square was the B round. So if you look at that cap table and you look at who's in it, the biggest of venture capital company in the world, Andreessen Horowitz is in the cap table; one of the most well known in the world, Union Square's in the Cap table. There's some famous people in the Cap Table. KK: Some actor... NE: Some actor guy that's from Iowa named Ashton. There's some really unique people in the cap table, and it's helped us. We've had great learning from being in the boardroom with a Union Square and Andreessen Horowitz and others. KK: What lessons do you think we can learn from the big investment funds, like an Andreessen Horowitz and Union Square? Or what lessons have you taken, what things -- positive or negative -- can we bring back to what we're trying to build here in the Midwest? NE: Well, the things that I -- the first thing I'll say is the entrepreneurs that are starting in Iowa are lucky because Iowa Nice does exist. But the thing that always impressed me with both Union Square and Andreessen Horowitz -- and the really big VC folks -- is that the constant focus on the funnel, the sales funnel. And the constant focus of the flywheel. Of keeping people, keeping prospects in the wheel and keeping the wheel moving and that process and how important it is and how, if that flywheel stops, everything else is probably going to stop.