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Shirt Contest May 2020

Shirt Contest May 2020

Call for Artists

Hey artists, we have new contest and we need your help.

Populus will be launching a limited run shirt this summer. We’d like to partner with a local artist on the design. The details are pretty simple: create a design for a shirt based on our theme. We’ll select one winner who will get a lot of cool stuff, including $2 from every shirt sold. We’re pretty excited about this one. Feel free to submit multiple design options and share this with your friends.

What you win

We’re giving over $750 worth of cash and prizes to the winner!

We’d love to support a local artist with cash and prizes. So, we came up with a package that we hope makes this worth your valuable skills.

  • You’ll get $250 cash from Populus
  • An additional $2 for every shirt sold
  • A free 6-month Virtual Membership
  • 5 shirts to give away (or keep)
  • Promotion of you on our social channels

Contest Details

Here are the details you need to know. If you have questions, please reach out to Cassie and she can get you the answers you need.

Theme

Design a shirt that inspires and unites Omaha.

Date

All submissions must be received by close of business on June 1, 2020. We will make a selection and announce the winer on Friday, June 5th.

Submit

Please submit your design, along with an artist statement about the work, to Cassie via email. Every submission should include a clean, simple, image of the work. You may also include mockups if you would like, but this is not required. The only requirements are one image of the work and an artist’s statement about your vision for the piece. We will contact the winner to arrange production-ready artwork after the contest. It will be the responsibility of the artist to prepare a production-ready file, so you’ll want to be sure you get your design into Illustrator (or get help from someone who can).

Parameters

This will be a one-color front only design. We suggest you consider a neutral shirt such as white, black, or grey. Designs with profanity, violence, or anything we deem offensive will not be considered. Populus will take ownership of the design from the winner. All other designs remain the property of the artist.

Submit by June 1 and you could win over $750 of cash and prizes.

Learn more about Populus Coworking >

Asset Environments

Asset Environments

When Populus Coworking first went public with plans to open in November of 2018, Founder Micah Yost received an email from Steve McGreer. The email itself wasn’t that atypical. “Let’s get coffee,” was the essence of the communication. About a week later, Yost and McGreer met at an Omaha Starbucks. They discussed business, life, and Steve’s new company Asset Environments. It was an exciting time for both Founders as the looked to the future of their young companies and planned for great things. 

Asset Environments has accomplished some incredible things since that meeting.

Asset Environments Omaha

Asset Environments would become one of the very first companies to join Populus Coworking. Since that first coffee meeting, Steve’s consulting group has quickly grown. The team started with a coworking membership, moved into a small office, and then moved to a larger office very quickly. Asset Environments works around Omaha, and across the country, providing building owners technical and financial solutions. One key service is helping with PACE financing. This is a special type of financing based on energy efficiency. In 2018, Asset Environments assisted Shamrock Development with the largest PACE financing deal in the country. As of mid-2020, Steve’s team has over $67 million in PACE financing deals approved.

DOLLARS of PACE Financing Deals Approved

The Asset Environments team has had other amazing accomplishments. As experienced engineers, project managers, and administrators they’ve become sought after for building system upgrades and environmental updates. In fact, the team has helped reduce about 4 million pounds of CO2 on a yearly basis. They do this trough working with control systems, heating, cooling, lighting, and many other factors in large buildings. Their innovative approach combines financial planning, detailed engineering, and technology solutions. 

Z

Saving WAter

112,000 Gallons of Water Reduction Every Year

Z

LESS CO2

3,846,007 Pounds of CO2 Emissions Avoided Per Year

Z

Less Electric

2,707,544 kWh of Annual Electricity Reduced

Asset Environments has worked on some of the most iconic buildings in Nebraska such as the Omaha World-Herald building and the vibrant Capitol District. Populus Coworking is thrilled to support this exciting company with flexible office space as their business grows. The idea behind Populus has always been to provide flexible workspace solutions for small businesses and entrepreneurs just like Asset Environments.

Nebraska Small Business Resources for Coronavirus

Nebraska Small Business Resources for Coronavirus

We’ve built this webpage as a resource library for small Nebraska businesses and nonprofits that need support. This is not intended to act as any sort of legal or financial advice. It is intended for information purposes only. If you know of other state or local resources, please submit them to us here so we can add to this list. Stay healthy and safe. We’re all in this together.

Interview With Husch Blackwell

Interview With Dr. John Hallgren

Our interview with Dr. Hallgren of Mission Direct Primary Care about Coronavirus and the response in Nebraska.

VC Backed Startups

NVCA is closely monitoring the outbreak of the coronavirus (COVID-19) and is working diligently to provide resources that aim to help firms and portfolio companies. This webpage provides important information and resources to venture-backed companies about the federal response to COVID-19, including tax credits, loan opportunities, and sick leave. There is some new information on this page about how the multi-phased approach by the government interacts. For example, if a firm uses the employee retention credit they can’t access the small business loan facility. It’s an either/or scenario. So It’s going to be important for firms to map out their approach before taking money.

Sections of this resource:

  • Legislative Action Important to VC-backed Companies
  • Federal Agency Resources and Action
  • NVCA Resources & Updates
  • Stop the Spread Campaign
  • Additional Resources for VCs and Startups

SBA Disaster Loan Covid-19

Download the PDF details by clicking here

  • The SBA offers disaster assistance in the form of low-interest loans to businesses, renters, and homeowners located in regions affected by declared disasters.
  • The U.S. Small Business Administration is offering designated states and territories low-interest federal disaster loans for working capital to small businesses suffering substantial economic injury as a result of the Coronavirus (COVID-19).
  • Any such Economic Injury Disaster Loan assistance declaration issued by the SBA makes loans available to small businesses and private, non-profit organizations in designated areas of a state or territory to help alleviate economic injury caused by the Coronavirus (COVID-19).
  • SBA’s Economic Injury Disaster Loans offer up to $2 million in assistance to help overcome the temporary loss of revenue they are experiencing.
  • These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses. The interest rate for non-profits is 2.75%.
  • SBA offers loans with long-term repayments, up to a maximum of 30 years.
  • For additional information, please contact the SBA disaster assistance customer service center. Call 1-800-659-2955 (TTY: 1-800-877-8339) or e-mail disastercustomerservice@sba.gov.

Unemployment Changes in Nebraska

The federal government is allowing new options for states to amend their laws to provide unemployment insurance benefits related to COVID-19. For example, federal law allows states to pay benefits where:

  • An employer temporarily ceases operations due to COVID-19, preventing employees from coming to work;
  • An individual is quarantined with the expectation of returning to work after the quarantine is over; and
  • An individual leaves employment due to a risk of exposure or infection or to care for a family member.

In addition, federal law does not require an employee to quit in order to receive benefits due to the impact of COVID-19.

General Information about NE Unemployment Insurance Program: https://dol.nebraska.gov/UIBenefits
To file a Nebraska UI claim online: https://neworks.nebraska.gov/vosnet/Default.aspx
To file a NE claim by telephone number: https://uibenefits.nwd.ne.gov/BPSWeb/jsp/BPSTelephone.jsp
To check the status of your claim: https://uibenefits.nwd.ne.gov/BPSWeb/jsp/BPSClaimantLogin.jsp

Nebraska Housing During Coronavirus

The U.S. Department of Housing and Urban Development announced a foreclosure and eviction moratorium Wednesday for single-family homeowners for the next 60 days if they have Federal Housing Administration-insured mortgages. The action “will allow households who have an FHA-insured mortgage to meet the challenges of COVID-19 without fear of losing their homes, and help steady market concerns,” HUD Secretary Ben Carson said in a statement. More information on the HUD’s eviction and foreclosure moratorium can be found here.

“For homeowners, Fannie Mae and Freddie Mac have already made clear that all you have to do is call your servicer, the phone number that you send your payment to every month, and tell them that because of coronavirus you are unable to pay your mortgage,” Dworkin said. “It may be because you lost your job, it may be because you’re sick. It doesn’t matter. They’re not asking for proof. They’re just saying if you can’t pay your mortgage because of COVID-19 let us know, and we will defer your mortgage payments for as long as six months.” More information can be found here.

Landlords in Omaha are being asked by the city not to evict residents at this time. If you need help with this issue, contact the mayor’s office.

Small Business Grants

In the private sector, Facebook pledged $100 million in grants on Tuesday for up to 30,000 eligible small businesses in over 30 countries hit hard by the COVID-19 outbreak. More information on how to access a Facebook grant for small businesses can be found here.

Coronavirus Toolkit

The U.S. Chamber has compiled CDC’s coronavirus recommendations for businesses and workers across the country. We continue to encourage American businesses to follow data-based guidance from the CDC and state and local officials. Here, you’ll find sharable graphics based on the CDC’s latest guidance for businesses and employees.

EXIM Extends Assistance

The Export-Import Bank of the United States (EXIM) is announcing relief provisions for exporters and financial institutions located throughout the United States that may have been affected by COVID-19 (coronavirus). These adjustments include:

  • Working Capital Guarantee Program
  • Multi-Buyer and Single-Buyer Short-Term Insurance Program
  • Medium-Term Single-Buyer Insurance Policies Issued to Exporters 
Working Capital Guarantee ProgramMario Ramirez
Smaro Karakatsanis
(202) 565-3785
(202) 565-3943
Export Credit InsuranceAnita Turi (Multi-Buyer Policies)
Jean Fitzgibbon (Single-Buyer Policies)
(202) 565-3669
(202) 565-3620
Medium-Term Insurance and GuaranteesBonnie Cybulko(202) 565-3951
Central Regional Office
Eastern and Western Regional Offices
Michael Howard
Sharyn H. Koenig
(312) 353-8093
(305) 526-7436 x17
Claims ProcessingDonna Schneider(202) 565-3612
Director of Broker RelationsEd Coppola(202) 565-3717
Senior Vice President – Medium and Long-Term LendingDavid Sena(202) 565-3272

Small Business Relief Initiative

The Intuit Quickbooks website has resources and tips about what you can do to address the coronavirus pandemic, including:

  • Financial preparedness tips
  • Workplace prevention tips
  • Suggestions for hosting events
  • Best practices for remote work
  • Boosting employee morale
  • Guidance for protecting your business and employees during the pandemic
To help small businesses affected by COVID-19, we’re teaming up with GoFundMe to launch the Small Business Relief Initiative.
QuickBooks is committing up to $1 million through a fund and employee-directed contributions while also seeking donations from other large partners.
If you’re a small business impacted by COVID-19 or want to help a local business, you can start a GoFundMe fundraiser.
How it works
1.Visit Small Business Help to start your free GoFundMe page.2.Share your fundraiser with your community, using #SmallBizRelief to spread the word.3.Learn more about how the Small Business Relief Initiative will support these fundraisers, boosting contributions from your supporters.

Nebraska Low Income Energy Assistance Program 

The Nebraska Low Income Energy Assistance Program (LIHEAP) helps people with limited incomes offset the cost of heating and cooling their homes. The program will partially pay the cost of electricity, fuel oil, gas, coal, wood, kerosene, propane, or other fuel sources.

Stimulus Package For Small Businesses

The federal government is passing a $2.2 trillion stimulus bill that will have significant provisions for small business owners. Here are a few highlights from the bill, as well as an informative article from the Tax Foundation. This is an important time for small businesses to start circling up with their CPAs and accounts to discern the best advantages and opportunities. Do you need an account? You should talk with Climb.

  • Extended unemployment benefits to include1099’s and contract workers
  • Employers may receive up to a 50% payroll tax refund if their revenue drops by 50% or more
  • Employers can pay for student loans of employees and it will not be counted as income for the employee
  • Paycheck protection act will provide loans for small businesses that could be completely forgiven if businesses retain all employees
Here’s How Omaha Ranks Amongst Midwest Startup Cities for 2019

Here’s How Omaha Ranks Amongst Midwest Startup Cities for 2019

The Midwest drives top startup returns. That’s the argument in a recent piece on Forbes of the same title by Venture Capital pro Pete Wilkins. He recently directed a study titled the 2019 Midwest Startup and Venture Capital Market Analysis. “After evaluating the data in the analysis,” Wilkins writes, “I argue that one of the best places for venture capitalists to smartly invest their cash is here in the Midwest.”

M25, a Midwest venture capital fund, recently released a study on the state of the Midwest tech ecosystem. This study is likely one of the more comprehensive data sets available for others to study on the Midwest startup scene. This year Omaha moved down two spots in the overall rankings, placing it amongst cities such as Bloomington, Indiana, and Champaign, Illinois.

So, how does Omaha rank amongst its startup peers? Specifically, how does Nebraska’s largest city rank amongst similar sized locations or cities nearby? The primary source of information for this piece is data from M25 on the top 50 startup cities. We will also consider the Silicon Prairie News State of the Prairie 2018 document and the Midwest Startup and Venture Capital Analysis from Hyde Park Angels. While the raw data is not available for this Silicon Prairie piece or the HPA Market analysis, the commentary and context are helpful. According to M25 data, amongst major Midwest startup cities, Omaha ranks 18th.

Similar Startup Cities to Omaha

  1. Omaha, Nebraska
  2. Akron, Ohio
  3. Grand Rapids, Michigan
  4. Louisville, Kentucky
  5. Dayton, Ohio
  6. Wichita, Kansas

In the M25 data set, the above cities are most similar in size, and we will use them as our benchmark for comparison. The interest of this piece is how Omaha compares with other communities of the same size in the Midwest. That is, of course, not a perfect benchmark. It is an interesting way to consider the data, though. The idea here is not to explore where Omaha may want to be in the future, but benchmark where Omaha might be right now.

Even with a smaller population, Omaha (pop. 8.95) leads in multiple categories, beating out Akron, Ohio (pop. 10.67) and Grand Rapids, Michigan (pop. 10.30), Dayton, Ohio (pop. 7.52) and even tying with Louisville, Kentucky (pop. 12.72) in multiple categories. Controlling for population +/- 4 points, Omaha comes in second in total ranking score, following Louisville, Kentucky, the largest of the group. The data breaks down into three primary categories: startup environment, access to resources, and business climate. We’ll consider each of these categories in the following article.

The Omaha Startup Environment

Startup Activity Data Omaha

Positive: Top in exits and high startup density
Negative: Lagging in startup momentum

Omaha performs well when it comes to many areas of entrepreneurial activity for 2019. It outperforms all the comparable cities in startup exits. In 2019, significant startup exits in Omaha have included D3 Technology, who sold to NCR Corp, and Flywheel, who sold to WP Engine. Omaha also does quite well at the overall number and density of startups for its size. Concerning, though, and perhaps more important than the other numbers, is startup momentum. This is the percent change in the number of startups over the past five years. In this area, Omaha is second to last in its comparable group of Midwest locations. It falls behind Louisville, Akron, Grand Rapids, and Wichita. In fact, 37 of the 50 cities scored higher on startup momentum, placing Omaha near the very bottom of the Midwest cities when it comes to launching young companies.

For innovation to thrive, momentum is vital. Though Omaha may have a head start on other cities, these numbers reflect some reason for concern around startup growth. Though cities like Wichita, Akron, and Grand Rapids have fewer startups and a lower density, they are growing fast. For Omaha to keep its place amongst Midwest peers, it will likely need to step up the momentum in forming new young companies. The rate of new entrepreneurship is one of the Kaufman Foundations keys to a healthy startup community. This need is echoed in the recent State of the Prairie report, which says, “Omaha’s most fundamental issue right now is that more new technology-based, scaling companies must be started.”

Omaha Access to Resources

Startup Resources Data Omaha

Positive: A leader in the number of resources
Negative: These resources may not be fully utilized

When it comes to accessing resources, Omaha is an outlier in a few key areas. No other city in the comparable group has an educated workforce or Fortune 500 presence quite like Omaha. These outlier areas may skew the numbers a bit. An argument could be made that these put Omaha in a more favorable light than it deserves. While the city has a significant density of Fortune 500 companies, these companies have little engagement in the entrepreneurial community. There are few discernable ties between large organizations like Berkshire Hathaway, Union Pacific, or Conagra Foods, and the entrepreneurial ecosystem in Omaha. This is a significant resource but doesn’t appear to be one that is well utilized at the moment. The State of Silicon Prairie report wrote, “Large companies in Omaha are not participating at the level that they should regarding spin-outs and translational research.”

Fortune 500 Startup Data

Still, the chart above from the HPA Midwest Market Analysis shows that the gap Nebraska has between Fortune 500 and the amount of venture funding is better than many. Texas, even with significant funding in cities like Austin and Dallas, still has the largest gap. Even Minnesota, with great startup momentum in the Twin Cities, falls short. Omaha can do more to connect with its corporate partners, but many successful startup cities are situated in states with larger gaps.

Considering the number of venture capital investors and the number of Angel investors, Omaha ties for the top spot with Louisville. Interestingly, though, Akron and Grand Rapids have the same amount of reported capital deployed with far fewer investors. Again, it would seem that Omaha’s resources are a bit underutilized here as it compares to Midwest peer cities. A higher number of investors with a lower amount of capital deployed probably communicates a lack of opportunity, interest, or education. The Nebraska Angel group is well organized and quite active. It may be the gap between the number of investors and the capital deployed is due to a deal flow issue around Omaha. Or, put another way, lower production of new and young companies is creating a void of investment opportunities for Angels in Omaha.

By the numbers, Omaha has a robust set of resources. These resources help place its aggregate ranking high amongst its peers, which should be encouraging for local startups. Still, closer analysis shows these resources may be underutilized or not fully engaged.

The Omaha Business Climate

Positive: Low cost of living with an inexpensive and well educated workforce
Negative: Isolated with low population reach

Omaha is in the middle of the pack when it comes to population size in this group, ranking bellow Louisville, Akron, and Grand Rapids, while ranking above Dayton and Wichita. Despite its size, Omaha has the highest GDP amongst the group. This is likely anchored by its high density of Fortune 500 companies. Omaha has the lowest labor costs in the group and one of the lowest costs of living, presenting a favorable climate for founders. Often the city of Omaha is pitched as an inexpensive place to live and work with a great workforce. The numbers seem to back this up, placing Omaha tops amongst its peers.

A note should be made that Omaha’s low cost of doing business, which includes low wages, may hurt talent retention. While there are cost savings opportunities for business owners, it can be difficult to attract and retain the best when similar markets provide higher pay. A recent Omaha World-Herald study states, “across an array of skilled, high-demand job fields from software app developer to auto mechanic, average wages for workers in the Omaha metro area generally lag what’s paid in other major metro areas in the region…”

Omaha has a low population reach, which may make it feel isolated. Cities like Akron have access to other large hubs within their state like Cincinnati, Columbus, Cleveland, and Dayton. Cities such as Omaha and Wichita may struggle to make meaningful connections outside of the metro areas.

Despite all of these notes, the business climate may be where Omaha shines brightest in this data. A great airport contributes to the many benefits it offers founders.

Omaha, Positioned Well but Lacking Momentum

This data is only one snapshot of what’s happening in the Omaha entrepreneurial community. It likely has flaws and is far from perfect. Still, it presents a somewhat concrete picture of what’s happening. Some amount of measurement, like this data, brings more clarity to the state of the Midwest startup scene. It’s apparent Omaha is positioned to thrive. It is well resourced and inexpensive. It’s a healthy city. Sometimes, though, the resources aren’t the whole picture. The question might be: is Omaha maximizing the potential of its resources?

This analysis would suggest Omaha is not fully utilizing its advantages. Lower startup momentum shows fewer companies coming online. This may contribute to the healthy Angel Investor community that isn’t performing as many deals. Omaha likely needs a way to increase its momentum if it wants to keep a position as top amongst its peers. The metro area could punch above its weight class, potentially competing with even larger cities in the Midwest. Forming more young companies and engaging corporate America in the community are likely keys to even greater success. This should be paired with increases in pre-seed capital for young companies.

Considering the Lincoln, NE, Startup Scene

Any conversation about the Omaha, NE, startup scene should likely include Lincoln. Some may consider these two cities one statistical area as they are only a 40-minute drive apart. They are quite different in many ways, though. Lincoln has a population just shy of 300,000, while the Omaha Metro area has a population just shy of 1,000,000.

Lincoln is home to the University of Nebraska-Lincoln, which is the largest university in the state. This campus is nestled right up against downtown, the growing Haymarket district, and the new Railyard. There is a significant geographical density in the capital city for startups and innovation.

Overall, in the M25 data, Lincoln ranks 19th and Omaha just ahead at 18th. Omaha’s weighted score was 11.23, which is hardly over Lincoln’s 11.06 weighted score. In the State of the Prairie study, Omaha also ranked just one spot above Lincoln at numbers 11 and 12. A closer look at the data presents an interesting comparison between the two.

The Lincoln Startup Environment

When it comes to startup exits and large capital raises, Omaha appears to excel. There could be an argument made that these are trailing indicators of previous momentum. Lincoln has double the startup density that Omaha has and triple the startup momentum. These could be considered more leading indicators of future success. According to this data, Lincoln would appear to have more forward motion than Omaha. From one perspective, Lincoln, NE, appears to have a more vibrant and growing startup scene.

Lincoln Access to Startup Resources

There are large swings, again, when comparing Omaha to Lincoln in this category. The weight an interested party might place on each of the metrics makes a large difference in how one might asses the two cities. Additionally, local knowledge would suggest that the assessment here of metrics like the university ecosystem or the number of angel groups is skewed. For example, Nebraska Angels is the largest and most active angel group in Nebraska. It is technically based in Lincoln. This group invests across both cities, though, and it should likely be assigned to both locations.

Omaha does have a significant presence of Fortune 500 corporations. As previously discussed, these companies are not meaningfully invested in the local startup ecosystem. While this corporate presence is counted as an advantage to Omaha in this data, it remains to be seen if that will become a reality. On the other hand, this data shows a large advantage to Lincoln in the university ecosystem. While Omaha’s score of zero is too low, Lincoln does have a very active and supportive university that has invested heavily in the ecosystem. The University of Nebraska-Lincoln is a huge advantage to the capital city. Omaha would do well to build more meaningful engagements and partnerships between entrepreneurs and its great universities.

The Lincoln Business Climate

The business climate is an essential part of any thriving startup scene. Cost of living, labor costs, and tax climate are essentially the same in both cities. Omaha does have a larger and more convenient airport, which increases connectivity and the spread of talent and ideas. Overall, this data set shows Lincoln comparing favorably to the Omaha metro, even with a smaller population size.

Lincoln has the startup momentum Omaha needs

As with many assessments, this one is likely not comprehensive and far from perfect. But this doesn’t mean the insights lack actionable value. Pulling together three studies provides one of the most complete reviews of the Midwest startup community. It’s apparent from this data that Lincoln is coming on strong with great momentum and high startup density. If we consider these as leading indicators of future success, then the Lincoln startup scene has a bright future. Perhaps brighter than Omaha’s current trajectory.

This isn’t to say Omaha is poorly positioned, but it may lack the momentum and density of its sister city. Perhaps Omaha could look to indicators like the university system and engagement with corporate America to increase these pieces of the community. Omaha may also consider initiatives to launch and support more young startups, which would help build overall density.

Omaha is vibrant and, based on these assessments, a startup leader in Nebraska and amongst its Midwest peers. To build on this success, the community must launch more companies and maximize the potential of its local resources.


As previously mentioned, the “2019 Best of the Midwest: Startup Cities Rankings” article and associate data from M25 VC is a significant piece of this article. Please take a moment to get to know M25 if you’re not familiar with their work. https://m25vc.com/

Opportunity Zone Investment for Startups

Opportunity Zone Investment for Startups

“This round of regulations removes some of the most significant impediments keeping capital on the sidelines, especially as it relates to operating businesses.”

John Lettieri, president of the Economic Innovation Group

Locating funding as a startup or small business can be a challenge. Investment capital for startups is at a premium, specifically venture capital in Nebraska. Small businesses of all kinds struggle in Nebraska to locate money that is active and ready for a risk. There is an exciting new opportunity, though, for organizations of all types seeking investment capital in Nebraska, or anywhere else in the United States. In April of 2017, the IRS released information on a new tax advantage for investors called Opportunity Zones. And in April of 2019, the IRS released new guidance, which makes it more attractive for investors to consider small businesses and startups in these opportunity zones.

What is an Opportunity Zone?

An Opportunity Zone is an economically-distressed community where investments may be eligible for preferential tax treatment. Opportunity Zones (often called OZ’s) are nominated by the state and approved by the federal government. They were added to the tax code in 2017 as a part of the Tax Cuts and Jobs Act.

It’s relatively easy to find out where Nebraska Opportunity Zones are located by visiting the Opportunity Nebraska website. They have a straight forward map showing the location of all zones. Nebraska was eligible to nominate 44 areas. To be nominated, an area poverty rate needed to be at least 20%, or:

  • If located in a metropolitan area, the median family income can not exceed 80% of the greater of (i) the median family income in the metropolitan area or (ii) the statewide median family income, or;
  • If located in a non-metropolitan area, the median family income can not exceed 80% of the statewide median family income.

How Do Startups Benefit From Opportunity Zones?

The new guidance as of April of 2019 from the IRS makes Opportunity Zones a lot more exciting for businesses of all types seeking funding in Nebraska. The short version of things: investors can place money into a qualified startup or small business and avoid some, or potentially all, capital gains taxes. But, to fully understand the opportunity for small businesses in Nebraska, we have to dig just a little deeper in the specifics. 

According to the Tax Policy Center, the benefits to investors more specifically look like this:

  • Deferral of taxes on previously earned capital gains
    Investors place existing assets with capital gains into Opportunity Funds. Those capital gains are not taxed until the end of 2026 or when the asset is disposed of.
  • Basis increase of previously earned capital gains 
    For gains placed for at least 5 years, investors’ basis increases by 10 percent. If invested for at least 7 years, the basis on the original investment increases by 15 percent.
  • Permanent exclusion of taxable income on new gains
    For investments held for at least 10 years, investors pay no taxes on any capital gains produced through their investment in Opportunity Funds (the investment vehicle that invests in Opportunity Zones).

Capital gains taxes are paid on the difference between the sale price of an asset and its original price. There are, of course, all kinds of nuances that may be applied to reducing a tax burden, but let’s keep our math simple for a moment. If an investor places $100,000 into a startup and then exits that startup with a solid return of $750,000 after a few years, again, keeping things simple, that investor may be looking at a capital gains tax of 20% on the $650,000 gain. That’s a healthy $130,000 in taxes! Ouch.

But there is good news for our investor called an Opportunity Zone. If that investor was to move all of that realized gain into a new startup located within an OZ, they may reduce the taxable amount of that gain by 15%. Further, all of the gains on the new investment in the OZ could be free of capital gains tax. To do this, they would need to stay invested for ten years. There are pro-rated tax incentives for shorter investments. This accomplishes two important things: it reduces the immediate tax burden and creates more attractive returns on Qualified Opportunity Zone Businesses. Our example investor could save hundreds of thousands in taxes by using an Opportunity Zone Fund.

Related: Guide to Finding Angel Investors in Omaha

How do I qualify for Opportunity Zone investments?

The recent tax guidance from the IRS helps. Over the past two years, most Opportunity Zone funding was heading straight into commercial real estate. This was because investors were unclear on the rules around investing in companies. What if that startup sells products outside of an OZ? What if that small business has employees located outside of an OZ? These issues could cost investors significant dollars. Most of these questions have now been addressed, thankfully, so Nebraska Investors can move with more confidence.

According to the Wall Street Journal, “Under Wednesday’s rules, Treasury says a business can qualify if 50% of its employees’ hours or wages are in the zone.” Further, a business may qualify if its property and/or managers needed to produce 50% of its revenue are in an Opportunity Zone or if it can otherwise show that 50% of the revenue is generated in the zone. We call these companies Qualified Opportunity Zone Businesses (QZOB). So, if your company headquarters in a Nebraska Opportunity Zone, you are likely to be a prime candidate for these attractive investment funds. 

Related: Omaha Startup Press for 2019

Where do I find Opportunity Zone Investors?

Any Accredited Investor may benefit from these Opportunity Zone tax incentives. We’ve written an extensive guide on how to find Angel Investors that you may want to check out. Many funds are forming with a focus on Opportunity Zones, and these Opportunity Zone Funds are the primary vehicle for investment in these areas. The new guidance gave these funds a grace period of about a year to invest in businesses, which has made them more attractive. This guidance is relatively new, though, and founders may find themselves having to explain the opportunity to potential investors. Sharing this article with them may be a great start.

Populus is located in an Opportunity Zone

And here’s a fun fact for you, Populus Coworking is situated within a Nebraska Opportunity Zone. This means that any business which moves at least 50% of its operations to Populus can be a Qualified Opportunity Zone Business and take advantage of these incentives. We will be encouraging Angel Investors in Omaha to take a look at Populus members for their next investment as it could save them thousands upon thousands of dollars. 

Related: Unique Benefits of Shared Office Space

Investing In Opportunity Zones Makes Nebraska Stronger

The tax incentives that Opportunity Zones provide investors are exciting for both founders and Angels. There is something deeper here, though, for Nebraska. Since the last recession around 2008, small businesses have been responsible for 100% of the net job growth in the United States. Put more simply; it is small businesses and startups that create jobs. Investing in companies within an Opportunity Zone will create significant job growth in those distressed areas. This is where the magic of this new plan could really drive meaningful impact beyond wealthy investors avoiding substantial tax burdens. This plan has the potential to create more meaningful returns for investors who help founders create jobs in distressed areas. According to CNN, the $2 trillion of unrealized gains that currently exist could benefit the rich and poor in a time when income inequality is rising. This is a new program and there will surely be much debate about its effectiveness in solving these income inequalities, but there is potential. That could be a massive win for Nebraska.  

Disclaimer: This article is intended to help business owners make more informed decisions in regards to the topic; however, please contact an attorney for legal advice and an accountant for tax advice. Populus makes no representation as a legal advisor or tax advisor.

Guide to Finding Angel Investors in Omaha

Guide to Finding Angel Investors in Omaha

Raising capital isn’t easy. Raising your first round of capital can easily be the most difficult, especially for those who haven’t raised with previous companies. For many founders, raising money can become a full-time job. It takes time to build the pitch, format spreadsheets, and then attend meetings upon meetings. This is, of course, on top of actually running your company. Sound exhausting? It can be. But for most founders, that’s how the game is played.

This guide should help if you’re struggling to find angel investors in Omaha or around Nebraska.  A word of caution, though, before we begin. Never lose focus on business development. Every hour spent hunting for investors is an hour you could’ve spent acquiring more business which makes finding investment a lot easier. The more traction you have, the more success you’ll have with investors.

If you have traction, monthly recovering revenue, and a clear acquisition channel identified then finding an investor to take you to the next step is a great idea. This article is written to help guide founders looking for investors in Omaha. This doesn’t mean that the strategies we show in this article can’t be applied to other cities, states, or even countries.

What is an Angel Investor?

An angel investor is a wealthy individual who invests in startups typically in the seed, Series A and Series B funding.

Wait, What is Seed or Series Funding?

Seed stage funding is generally considered to be your first official round of investment. It typically comes after the initial investment by the founder(s) and their friends or family. Series A funding would come after your Seed funding and is typically reserved for companies with clear products, marketings, and paths forward.

In Omaha, and around Nebraska, things work a bit different than on the coast. A Seed round of funding in Omaha might be as little as $50,000 and typically not more than $1.5 million. This can often be done with local accredited investors. In Nebraska, a series A is often over $1 million but less than $5 million. Investment rounds of this size typically require the involvement of regional and national investors.

What is an accredited investor and the requirements?

An accredited investor is an individual or business who can engage in securities that are not registered with the SEC.

Securities need to be registered with the SEC in order to be offered for investment. However, there are exemptions under Rule 506 of Regulation D. Accredited individuals can invest in opportunities like a startup if they meet certain criteria.

Accredited Investment Requirements

  • $200,000 in annual income for the past 2 years
  • $300,000 in annual joint income for the past 2 years
  • Net worth or joint net worth over $1,000,000
    • Primary residence does not count

Other unique exemptions for Accredited Investors

  • Trusts with total assets over $5,000,000
  • Any entity in which all of the equity owners are accredited investors.

When should you look for an Angel investor?

Once the founders are heavily invested and you’ve identified product-market fit, you’re probably ready for Angel investors.

Here’s our checklist for when you should raise money:

  • Found a potential acquisition strategy and channel
  • Acquiring customers faster than you can deliver product or features
  • Have a solid customer foundation with little churn
  • Achieved product-market fit
  • You need capital for a large purchase i.e office space/building

Remember, raising money can also be framed as selling pieces of your company at a discount to a future value. That is, your plan is for your company to be worth more someday and you’re selling it now for less money. You should raise capital when you need capital, but not before and only if the need is beyond your capacity. You want to keep as much of your company as possible for as long as possible, don’t be too eager to give it away.

Essentially, the only reason you should get investment money is to scale your business to the next point faster. For example, if you’ve proven to have a low customer acquisition cost within a certain channel and it has a healthy profit margin, then it’s a great idea to raise capital to capitalize on the opportunity. Capital should help you turn the flywheel faster, not build the flywheel.

Another reason to raise capital is if you’re adding revenue at a rapid rate and you can’t hire fast enough. There are a few options, either slow down or raise capital to buy all the extra infrastructure you need to support this rapid growth. If you don’t then your company will spiral out of control and crash. Too much too fast will break things. But don’t overlook the opportunity to slow down and finance with cash from sales.

“It may seem premature, but you need to be thinking of your exit from the moment you accept capital, because at that moment, you’ve made an explicit agreement with an investor that he or she will eventually be able to gain liquidity.” – Neil Blumenthal

Only take money when you’re on the offense.

Seed capital isn’t typically enough money to pay the founders a salary. If you’re looking for seed capital to extend your runway, you’re headed straight for burned bridges. If you’re a brand new founder with little to no experience then don’t get funding until you’ve completed the following checklist.

Related: Omaha Startup Press for 2019

Checklist for Startups Raising Money

Before you go out and apply for investment it’s best that you are prepared. Too many first time founders attempt to raise capital when they’re not ready. Here is an investor checklist for new startup founders trying to raise funding:

  • Pitch Deck (Keep it under 20 slides)
  • Cap Table
  • Team
  • Key Performance Indicators (KPI’s)
  • Exit Strategy
  • Type of funding (Equity, Convertible Notes, Venture Debt, etc)
  • Acquisition Strategy

Helpful KPI’s for raising money

Startups that track these KPI’s will have a significantly easier time securing capital. Even better, you’ll get genuine feedback from investors on how to improve certain KPI’s.

  • Customer Acquisition Cost
  • Cost Per Lead
  • Daily Active Users
  • Weekly Active Users
  • Monthly Active Users
  • Customer Lifetime Value
  • Operating Margin
  • Burn Rate
  • Churn

Apply to Angel Groups in Omaha

One of the best ways to secure capital for your early-stage startup is through Angel Groups.

Nebraska Angels

Nebraska Angels is a group of 60 active angel investors. They’ve invested over 26 million into startups. The angel group also has great resources throughout their site to help prepare founders for raising capital. Nebraska Angels typically invest in startups that need funding between $100,000 to $1,000,000. The funding should provide 12 to 24 months of runway. Check out Nebraska Angels “before applying” page to get more information.

Treetop Ventures

Treetop Ventures has a track record of companies of great early investments including a top Omaha startup Sojern. Sojern has brought investment players now alongside Treetop Ventures like the $7.5 billion powerhouse Northwest Venture Partners. One of the best things about Treetop is its transparency. They show you their bad bets, missed bets, and overall success.

Related: Why People Hate Offices and Don’t Like Their Jobs

Prairie Ventures

Prairie Ventures is a diverse investment fund based in Omaha with interests in a number of verticals. The fund has a few success exits already, and a number of unique equity investments like United Republic Bank, which was acquired. They’ve also found a number of successes in healthcare. You can read more about their investment criteria on their website here.

Invest Nebraska

Invest Nebraska is active in the Omaha market, and across the state. Their mission is to build a better future by investing in companies, developing high growth infrastructure, and attracting out-of-state capital to Nebraska. They’ve invested in over 50 companies including some of Omaha’s rising early-stage startups. Their portfolio includes Omaha Leverage RX, TAGG, OpsCompass, and Crumb. You can read all about their investment criteria, including FAQ’s and what to expect, on their website.

Find Accredited Angel Investors using LinkedIn Sales Navigator

Sometimes, the best route to raising early money is working directly with individual accredited investors. Raising new capital should be viewed like prospecting new business. If you’re unable to get new business then there’s a high chance that you will not be able to close a funding round. The same sales principles will be applied to prospecting accredited investors. The prospecting channel that we will use will be LinkedIn. In order to do this a subscription to Sales Navigator will be needed. Luckily, there is a 30-day free trial so this is the perfect use of building out your investor network. Here is our step by step guide:

Step 1: Identify your search criteria

The most important step in finding investors is knowing who to look for. Angel Investors are typically very wealthy individuals, so connecting with folks who aren’t wealthy is a waste of time for this specific exercise. Before you proceed, you should write down as much information as possible about the ideal person you’re trying to target. Build a persona of your ideal investor.

Here is an example:

LocationOmaha, Nebraska
TitleOwner
IndustryTelecommunications
Previous ExperienceManaging Director
Key WordsInvestor, Angel, Marketing

Let’s say I run a telecommunications startup. Then I would want the person or firm investing in me to also have experience inside telecommunications. This would increase the value of the investment tremendously. Treat the investor as a strategic partner and not so much as someone who gives you money. The right investor should provide you introductions, guidance, and help you solve or prevent problems in your space before they become critical.

Step 2: Find Individuals in your Criteria with Sales Navigator

In Sales Navigator, click on search by keyword or phrase. For the first try, search by the keyword “Angel Investor” and then filter by location “Omaha Nebraska.”

Here are the results:

There are a total of 262 results for people who live in Omaha and have the word Angel Investor. Now, this doesn’t mean that every person in that criteria is an Angel Investor, but this is a great start.

When saving these leads, always start off with those who have posted on their LinkedIn within the last 30 days. Those are the most responsive people in the industry. Here is a checklist of prioritizing which potential angel investors to prioritize.

  1. Shared Connections
  2. Years in Role and Company
  3. Activity on LinkedIn

The next step of the guide is to save potential angel investor profiles to your “lead list”.

Step 3: Save Angel Investor Profiles to Lead List

If you haven’t created a lead list then you should do that now. It takes less than two seconds. Just click on the save button next to the person’s profile.

Step 4: Contact shared connections

Once you’ve successfully saved everyone you want to reach out to it’s time to go through the list and contact the shared connections. The reason you want to start off with shared contacts first is that they’re the ones who most likely have had some sort of contact with the angel investor. A warm introduction almost always works better than a cold intro.

Step 5: Cold Connections

Maybe your shared connections don’t actually know a potential investor well and can’t provide you with an intro. If this is the case, then I recommend reaching out cold. If you don’t ask, it’s always a “no”. Also, remember you have about 50 words to get your point across, so take the time to write and rewrite your message. This cold intro message matters. It should be brief, practical, straight forward, and actionable. Here’s an example of a cold message, or email to use.

Hey {FirstName}! My name is {name} and I’m the Founder of {Company}. We’re currently raising capital for an Angel round and I’m specifically looking for potential investors with experience in the {industry or market you share}. Do you have an interest in Angel opportunities?  Below, you’ll find a link to your pitch deck and website. If you’d like to explore things in more detail, please let me know and we’ll schedule a call or meeting.

{Link to pitch deck via something like Dropbox}
{Link to website}

An important note, if you have investors already that you think this person may know you should also include this in your message. For example, “we’re raising $250k and we’ve closed $100k with Amy Smith and Sally Sue.”

The more personalized the connection request and or the email the higher the chance that they will accept and respond.

At the end of the day, it is a numbers game and the more you practice, test, and optimize the better the results you’ll get. There’s nothing special about getting meetings whether its for sales or raising capital. The prospecting, pitch, and the close process is very similar.

Step 6: Follow-up

People are busy, especially if they run their own company or advise others. Just like sales, follow-ups are extremely critical for success. Here’s a list of reasons why someone didn’t respond.

  • Email got buried in email inbox
  • Accidentally deleted email
  • Forgot to respond back to you
  • Email received wasn’t compelling enough

When you follow up, always bring new information or value. Never simply “circle back” on a message. Follow up with a new pitch piece, an announcement of a new investor, or inclusion of additional information that other investors have asked you to share. For example, “Hi, John, other investors have been asking me to include more detail on our cap table so I wanted to be sure you had that as well.”

Use Angellist to find active Angel Investors in Omaha

Angellist is a startups best friend. It’s a hub where you can go to find competitors, jobs, employees, investors, and potential prospects. We will be focusing on finding investors through Angellist. You can find a link to Omaha’s investor page here. You may want to find some of these investors on LinkedIn and work the investor prospecting process above.

Investors out of state interested in Omaha

There are many reasons why you should go outside of the city to look for capital. The Omaha investment community is not nearly as robust or mature as other larger markets. Local investors are great, if not ideal, for early rounds but you may need to pursue other options. If your business venture has a valuable model and a clear customer acquisition strategy there is no reason to avoid investors from outside the city or even the state. Once the investment is successfully secured, you could always explore state-sponsored grant options as a way to extend your runway.

Nebraska Innovation Fund Prototype Grants

Another overlooked way to get funding is through grants. The Nebraska Prototype Grant matches investments up to $150,000. The payout is done in disbursements so it’s not a lump sum of cash. The funds can only be used to cover certain eligible categories such as employees. For more information on the Nebraska Prototype fund or if you want to apply then you can go here.

Conclusion

In our guide to finding angel investors in Omaha, we covered when you should raise capital, what angel investors are, when you should raise capital, and some investor prospecting strategies that will help you secure funding or at least find new business in the process! Check out our office spaces in Omaha for teams of 2-20 if you’re ready to have a space to call your own. Populus is built for growing companies like yours.

Related: List of Coworking Spaces in Omaha

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