Chicago-based venture firm Jump Capital is casting lines into the vibrant waters of Minnesota’s tech scene.
Senior associate and Minnesota native Peter Johnson was in the Twin Cities last week, meeting with startups and investors to test the waters. We took the opportunity to learn more about Jump:
What is your goal in Minnesota and what interests you about Minnesota startups?
Our goal in Minnesota is to find promising companies that we can help scale. Aside from being a Minnesota native, what interests me about Minnesota is that there is a community of innovative individuals coming from great schools and Fortune 500 companies that has often lacked access to sufficient venture funding.
Compared with the amount of innovation coming out of Minnesota, and the entire middle part of the country, there is a relative dearth of capital, particularly for companies that are looking for relatively large investments to accelerate their growth. We also like the Midwest work ethic and mentality of creating “real” companies that are solving meaningful problems and have clear paths to profitability.
What is Jump’s background and fund parameters?
Jump Capital was founded a little over two years ago by our Managing Partners who have deep operational experience from their time as senior executives across a wide range of industries.
Over the past two years we have funded 20 companies. Our investments fall into three categories: early-stage, expansion-stage, and growth capital. We selectively invest $500k-$2mm in early-stage companies that have minimal to no revenue, and prefer to participate in syndicates for these investments. The majority of our investments are $2mm-$10mm investments in expansion-stage companies that have achieved significant commercial traction, and we will lead these investments or participate in syndicates.
We also will invest $5-$15mm in established middle-market companies that are looking for growth capital. Across these investment categories, what we are looking for is scalable B2B companies that are technology-driven and have strong management teams. We also like companies with recurring revenue streams and that leverage channel sales strategies. We invest across a wide breath of industries including enterprise technology, financial services, marketing, and healthcare IT.
What does an ideal startup look like for Jump? What’s in your sweetspot and what’s not?
The ideal startup would be a rapidly-growing B2B technology-enabled business with $2mm+ in recurring revenue that is seeking $3-$10mm in capital to scale the business.
Although we invest across a broad range of industry segments and company stages, we typically do not invest in device nor compound development companies, asset heavy/capital intensive businesses, or turnarounds.
What are three recent deals you’ve done and what compelled Jump to invest?
Our most recent investment was in Parkwhiz, which is the #1 place for drivers to find a reserve a guaranteed parking space before they reach their destination. Over $20 billion a year is spent on parking, and Parkwhiz is the clear leader in parking reservations. We also recently invested in SIM Partners, which is filling a large unmet need to optimize local online marketing for multi-location business, and ViaForensics, which is an innovative provider of mobile security products that leverage sensor data to uncover vulnerabilities. All of these companies are targeting large markets, and have exceptionally strong leadership.
How do you prefer startups to engage with Jump for consideration?
Feel free to contact me directly at firstname.lastname@example.org.
Anything else you’d like to add?
I look forward to finding some great companies in Minnesota and supporting my home state.