VENTURE FUND LAUNCH
Cove Fund, a seed-stage VC firm that has invested in over 40 Southern California startups, on Oct. 13 launched its third fund, Cove Fund III and announced the completion of its initial closing. The Irvine-based fund is expected to exceed $30 million in capital, more than doubling the size of Cove Fund II, officials said.
“First and foremost, we love working with startups and hungry entrepreneurs,” Fund Manager Paul Voois told the Business Journal. “It’s great to have a fresh fund to fill our tank with capital, so we can help great companies grow and become successful.”
The Cove Fund III is seeking early stage technology and life science companies. It typically leads rounds in the $1 million to $5 million range, and “syndicates out” the rest to its strategic partners, including OC funds Okapi Venture Capital and Ankona Capital, according to venture partner J.C. Ruffalo.
“The support that we’ve received from the local community has exceeded all our expectations, and we are excited to start investing in the next generation of great technology companies throughout Southern California,” fund co-manager Mike Benvenuti said.
The Cove Fund III will make its first investments in the coming months. It anticipates seeing 500 companies apply by the end of 2021.
FELLOWSHIPS
CEO Leadership Alliance Orange County (CLA-OC) on Oct. 14 launched its Orange Fellowship, a pilot mentorship program in partnership with the Anaheim Union High School District.
The high school mentorship program, launched by some of the Orange Fellows, allows high school students interested in technology and innovation to connect with young professionals.
“The Orange Fellows are closer in age to a high school student. There’s a connection line between a 16-year-old and a 24-year-old. They seem more accessible,” Peggy Wolff, co-founder and program manager of the Orange Fellowship, told the Business Journal.
“These opportunities are really beneficial to show young people the landscape of OC’s business community and how many opportunities there are.”
The Orange Fellowship—co-founded in 2020 by CLA-OC members Carey Ransom and Wolff—is an industry-agnostic, two-year-long fellowship designed for recent graduates who work full time at an OC company. The application window is currently closed.
Fellows participate in quarterly events that encourage skill development, from experiential learning opportunities to social gatherings, Wolff said. One such event is bringing in top-notch, well-respected” executives, like Alteryx co-founder and Chief Advocacy Officer Libby Adams, to share their lessons from corporate America.
“They so graciously share their career stories. Within those stories they share their pitfalls and challenges, but also the decisions that made the difference,” Wolff added.
The Orange Fellowship program hopes to use its pilot program with the Anaheim Union School District as a “template” for future partnerships with other school districts.
PARTNERSHIPS, FUNDING
OnSite Waste Technologies of Newport Beach said Oct. 20 it’s completed strategic partnerships with two medical device suppliers, Henry Schein and Direct Supply, ahead of its effort to raise $8 million in a Series B round, expected to take place in early 2022.
“These are two big players in the industry that have said, ‘We see value in this, and we want our customers to have access to it,’” Brad Barnes, founder and CEO of Onsite, told the Business Journal.
“For us as an emerging small company, this connection with big distribution partners is where we see the longer growth coming.”
OnSite aims to transform the way medical waste is processed at medical and dental practices, the company said.
Its TE-5000 is a desktop-sized unit that treats medical waste, like syringes, with heat, converting it into sterile garbage that can be placed in regular trash. The company said it’s “greener, cheaper and safer” than haul-away services.
OnSite was founded in 2016; it’s taken nearly five years to raise funds, earn regulatory approval for its product and bring it to market, Barnes said, adding that OnSite has previously completed two Series A rounds: one for $3 million in 2018 and another for $3.5 million in 2019 led by Cove Fund II.
VENTURE STUDIO LAUNCH
Dana Point-based Nobody Studios announced Oct. 19 Ray Leonard Jr., the son of boxing great Sugar Ray Leonard, has been appointed as CEO of Ovationz, its first startup, which is developing a platform for engaging virtual events.
It’s one of 14 startups Nobody Studios is currently developing, according to founder and Chief Nobody Mark McNally.
Nobody Studios is a venture studio launched in December 2020. It builds companies from concept to market with a focus not on funding goals and high valuations, but on profitability and proven business models.
The studio aims to create 100 companies in the next five years.
“I know it’s really uncomfortable, what we’re doing, and that makes me more sure we should do it,” McNally told the Business Journal.
According to McNally, Nobody Studios seeks entrepreneurs with ideas that can go to market within 12 months.
“We’re not a traditional accelerator or incubator. Our model will not be ‘Let us help you.,” he said. “If you want to join, let’s talk and we’d love to have you. We’re 100% involved in everything we do, and we’re going to do that at a higher scale than people can fathom.”
Entrepreneurs also earn equity in every company Nobody Studios builds, he added.
“You get your part if our company sells,” he added. “It’s going to be a talent battleground for the next 20 years and we must offer something people haven’t seen before.”
EXEC HIRES
Huntington Beach-based fintech firm BeSmartee announced Oct. 12 the addition of Richard Kellermeyer, its new director of engineering.
Founded by mortgage industry professionals and software developers in 2006, BeSmartee is a self-funded developer of digital mortgage platforms.
Before joining BeSmartee, Kellermeyer served as engineering manager at San Francisco fintech startup Roostify and led teams at eight other startups.
“Richard will play an integral and strategic role in heading BeSmartee’s software development team,” said Veronica Nguyen, co-founder and executive vice president of BeSmartee. “We are pleased to welcome Richard to our executive team during a year of tremendous growth for BeSmartee.”
Kellermeyer will report directly to BeSmartee CEO Tim Nguyen, who earlier this year was a finalist for “Best Small Tech CEO” at Octane’s High Tech Awards.
Acorns Grow Inc. of Irvine reported Oct. 12 it has appointed Seth Wunder as its first chief investment officer ahead of its expected public listing.
Acorns is a micro-investing app that has a reported 4 million users who have collectively invested over $9.6 billion since its launch in 2012.
“We see a huge and novel opportunity to give our customers the ability to get more active while staying diversified,” of Acorns CEO Noah Kerner said. “Seth will fuel our ability to offer new and more customized investment offerings that will let everyday Americans be more engaged in their financial futures.”
Wunder will work closely with Acorns’ newly appointed Chief Education and Content Officer Kennedy Reynolds to integrate personalized guidance and related educational resources, the company said.
“Acorns stands apart in the fintech ecosystem as a company with a long term vision, driven by the financial best interests of its customers,” Wunder said. “It’s more important than ever to educate investors on the significance of taking a long term view and utilizing techniques like dollar-cost averaging in a diversified portfolio.”
Acorns plans to go public by the end of 2021 through a special purpose acquisition company (SPAC) deal with a valuation topping $2.2 billion.
