Emory University’s Goizueta Business School will host the 18^th semi-annual RAISE (Retention and Advanced Investment for the Southeast at Emory) Forum on Friday, November 15. This invitation-only event connects startups and top-tier investors from across the Southeast to foster collaboration within the region’s entrepreneurial ecosystem and ensures the best startups can stay local.

The Forum is now accepting applications from post-revenue startups based in the Southeast seeking funding between $500,000 and $5 million. Seven startups are selected for each Forum to present to accredited investors actively looking to invest in early-stage companies. To be considered, a company must have revenue and participate in a short, complimentary training session to better prepare applicants for investor presentations. Startups in any field are encouraged to apply to present at the Forum by visiting www.raiseforum.com/entrepreneurs. Applications will close on Monday, September 27.

“RAISE Forum’s unique approach to connecting investors and startups has fostered a very impressive 20-25% success rate to date,” says RAISE Forum co-founder Barry Etra. “RAISE Forum is the only funding forum in the Southeast, and all funded companies (47 to date) have remained in the Southeast or have exited. To date, we have seven exits confirmed.”

Investor and Community Support

Current investor support for the Forum comes from across the region and includes hundreds of investors, including Circadian Ventures, Panoramic Ventures, VentureSouth, AIM Group, Fulcrum Equity, and TiE Angels. Additional support comes from Georgia Bio, ATDC, Atlanta Tech Village, Launch Tennessee, Tech Alpharetta, and other influential Southeastern startup incubators and influencers.

“This program fulfills one of our key goals of keeping startups in the region, along with showcasing a diverse group of founders and companies, as about 30% of RAISE C-level execs are underserved,” says Charles Goetz, associate professor in the practice of organization and management at Goizueta Business School and RAISE Forum Co-founder.

About RAISE Forum

RAISE Forum was co-founded in 2014 by Barry Etra and Charles Goetz to bring together startups and investors from across the Southeast and foster collaboration within the region’s entrepreneurial ecosystem. RAISE was honored by Atlanta Inno and the Atlanta Business Chronicle in 2019 as one of its initial “50 on Fire” in Atlanta, and the Forum was one of 11 original “Blazer” winners. The Forum, an integral piece of the Entrepreneurship program at Goizueta Business School and the “Entrepreneurial Practicum” course, was developed to give students first-hand experience identifying factors that make a successful startup and ways to practice investor due diligence techniques. To learn more about the event, visit www.raiseforum.com.

Active investors or regional organizations interested in supporting the Forum should visit raiseforum.com/investors or raiseforum.com/sponsors to learn more about sponsorship opportunities and registration.

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“We continue to develop principled and impactful leaders and entrepreneurs, foster innovation for a data and technology driven world, and grow a global presence fueled by local synergies,” said Gareth James, John H. Harland Dean. “I’m proud of our faculty and staff – and energized about the future of our school and students.”

Impacting Business & Beyond

Faculty and staff contribute to the Goizueta and Emory community, but also have significant impact on society and the broader business world. External awards include:

Karen Sedatole, Asa Griggs Candler Professor of Accounting, was named as an editor to the Accounting Review. Sedatole was also elected to the position of president elect for the Management Accounting section of the American Accounting Association.

Emma Zhang, associate professor of information systems & operations management, was named an elected member of the International Statistical Institute. Zhang was also named an associate editor to the Journal of the American Accounting Association.

Ruomeng Cui, associate professor of information systems & operations management, was a finalist for the 2022 Management Science Best Paper Award in Operations Management for her paper, “Learning from Inventory Availability Information: Evidence from Field Experiments on Amazon.”

Panos Adamopoulos, assistant professor of information systems & operations management, was named as an associate editor at Management Science.

Giacomo Negro, professor of organization & management, was appointed as the senior editor of Organization Science and also received an honorable mention for the Robert K. Merton Award for his paper, “What’s Next? Artists’ Music After Grammy Awards.” Negro additionally served as the principal investigator for the 2022 LGBTQ Southern Survey.

Erika Hall, associate professor of organization & management, was named as an incoming associate editor at the Academy of Management Discoveries.

Dan McCarthy, assistant professor of marketing and Marina Cooley, assistant professor in the practice of marketing were recognized by Poets&Quants’.” McCarthy was also a finalist for the Weitz-Winer-O’Dell Award.

John Kim, associate professor in the practice of organization & management, was designated as one of the top instructors by Coursera for Management Consulting courses.

Vilma Todri, assistant professor of information systems & operations management, was named an associate editor to the Management Information Systems Quarterly Journal, one of the top three leading Information Systems journals.

Tonya Smalls, assistant professor in the practice of accounting, has been appointed to serve on the Inaugural Advisory Board for Make-A-Wish Georgia (MAWGA).

Leading the Future Of Emory and Goizueta

Goizueta Business School and Emory also honor academic professionals and leaders for their dedication to excellence through teaching, content development, experiential learning, scholarly inquisition, and commitment.

“We could not be prouder of our exceptional faculty and staff for their remarkable work and dedication throughout the past year,” says Anandhi Bharadwaj, who will step down as vice dean for faculty and research this summer as Professor Wei Jiang prepares to take on the role. “It has been an honor to work alongside our faculty and staff in developing the school and its programs.”

The recipients of these prestigious honors and awards are listed below:

Rajiv Garg, associate professor of information systems & operations management, was awarded the Provost’s Distinguished Teaching Award for Excellence in Graduate and Professional Education. Garg was also honored as the MSBA Distinguished Core Educator.

John Kim, associate professor in the practice of organization & management, was awarded Emory Williams Distinguished Undergraduate Teaching Award.

Giacomo Negro, professor of organization & management, received the Keough Faculty Award. Negro also received the Jordan Research Award.

Marvell Nesmith, associate dean of academic affairs & instructional design, received the Keough Staff Award.

Marina Cooley, assistant professor in the practice of marketing, was honored as the BBA Distinguished Educator and was also recognized for MBA Teaching Excellence (One Year).

Omar Rodríguez-Vilá, professor in the practice of marketing, was awarded the Evening MBA Distinguished Core Educator and was also recognized for MBA Teaching Excellence (Two Year).

Charles Goetz, associate professor in the Practice of organization & management, was awarded Evening MBA Distinguished Elective Educator.

Ray Hill, associate professor in the practice of finance, was recognized for MBA Teaching Excellence (Classic Faculty).

Alvin Lim and David Sackin were awarded MSBA Distinguished Elective Educators.

Rob Kazanjian, Asa Griggs Candler Professor of Organization & Management, was awarded Executive MBA Distinguished Educator (Core).

Kevin Crowley, associate professor in the practice of finance and Narasimhan Jegadeesh, Dean’s Distinguished Chair of Finance, were awarded MAF Distinguished Educators. Crowley was also awarded Executive MBA Distinguished Educator (Elective).

Giacomo Negro, Melissa Williams and Panos Adamopoulos received Goizueta research awards at the levels of full, associate, and assistant professor, respectively.

Goizueta Business School is proud to present the accomplishments of these and other faculty members within our institution. To learn more about the teaching, specialized research, and core interests of each faculty member, check out our faculty profiles and their related publications. 

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“Many more women are now starting businesses. Maybe 15 percent of the students in my classes were women back in 2010,” Goetz recalls. “Today I have classes where that’s 45 percent.”

The gap between men and women is narrowing, with women now pursuing a broader variety of businesses. “Guys tend to be more tech-oriented where I’d say a slight preponderance of women create more retail-oriented ventures, but not always. The trend is changing,” Goetz says. Women start businesses for different reasons than men. “I’d say women are not as motivated by money as men,” he says. “Women think, ‘this is a problem, and I can fix it.’ They want results. Men seek a great financial opportunity.”

Women are more mission-driven, and they start more nonprofits by far than men.

Charlie Goetz, distinguished lecturer in entrepreneurship

Founders Build Meaningful Businesses that Merge Passion and Profit

Lola Banjo 11MBA was compelled to found her startup Silver & Riley. Banjo works full-time as the senior managing director for strategy and innovation consulting at Salesforce, a position she loves and isn’t willing to leave. But she also harbored a “nearly decade-long dream” to start her own company and realize her “genuine passion and love for both the travel and fashion industry.”

Banjo’s startup workday begins at 2 a.m. for Silver & Riley.

Entrepreneurship is not for the faint of heart. It takes real commitment, dedication, time management, and true passion to sustain.

Lola Banjo 11MBA

Silver & Riley manufactures and sells stylish leather travel bags and accessories for professional women; the brand now includes fashion, which will expand her target audience.

As the founder of Gather’d Market, Antoinette Rosenberg 14MBA saw a problem and decided to fix it—a lesson she learned at Goizueta.

You can build a successful and enduring business off of one unique customer insight. This was a common theme in the stories of all the entrepreneurs we heard from in Charlie Goetz’s classes.

Antoinette Rosenberg 14MBA

Rosenberg is tackling the pain point of families who need a ‘meal-time partner.’ There are plenty of ways to get groceries delivered, but Gather’d is entering into the food buying experience before families even make their grocery list. Located in Seattle, Rosenberg has aspirations to expand nationally.

Raising Capital Presents Greater Challenges to Female Founders than Male

One of the biggest differences between men and women entrepreneurs comes in raising capital. “Unfortunately, it is harder for women to get funding. But more venture companies and angel groups are now looking for women’s businesses specifically,” Goetz says. “Banks are also making a significant change to try to better the needs of women entrepreneurs.” Adding, “Now, we are having a different conversation.”

Banjo invested $200,000 of her own money to launch her business in October 2019. Five months later, the COVID-19 pandemic hit. Sales halted. She couldn’t receive her product or travel to Italy where the bags were made. As for working capital? It was tied up in inventory that couldn’t be delivered. She relied on “strength of mind” to navigate the challenges and relied on memories of “grit, pain, and preserving the human spirit,” from her time growing up in Lagos in an area severely economically disadvantaged.

Atlanta-based Laine London is a first-of-its-kind Black woman-owned rental bridal shop that provides brides-to-be with convenient and cost-efficient access to wedding gowns, veils, accessories, and more. With 2.5 million weddings a year in this country, Founder Lundyn Carter 17EMBA sees a huge national opportunity.

Carter bootstrapped for the first year, which “allowed us to find product-market fit and build a working capital model that has allowed us to fund our own growth.” She received over $150k in capital contributions in the form of non-dilutive grants from organizations such as Google, American Express, Facebook, and Unilever. Carter also partnered with Verizon on her marcom strategy and SAP on streamlining operations.

Sights set high, Carter’s quest is for Laine London to become the premier wedding resource in the U.S. and attract funding opportunities. “We’re not what your traditional venture-backed startup looks like, so I anticipate some hesitation from investors who may not initially understand our growth potential or see a path to profitability,” she says.

While some would call Laine London a small business, I see us as a tech-enabled Clothing as a Service (CaaS) startup that’s disrupting a 2.4B industry that has seen little to no change. I believe that the right capital resource(s) will come along and see Laine London as an asset to their portfolio.

Lundyn Carter 17EMBA

Rosenberg concentrates on fortifying her business and doesn’t chase after money. “I have learned, and continue to come back to, the importance of staying focused on the real human problem you are trying to solve.”

“In a frothy startup market, it’s easy to look around and see all the money being raised for on-trend businesses. But if raising money is your end game, then one day you’re a ‘future of work’ company, and next day you’re a web3 business,” she says. “This feels like a sure way to fail. Instead, I’ve learned that staying focused not only keeps you moving in the right direction but also opens up opportunities for innovation.”

Antoinette Rosenberg 14MBA

Business is the Most Powerful Vehicle for Change in Society

Goetz shares that more women not only start nonprofits than men, but they tend to have a charity or nonprofit component in their enterprises. The first lesson Rosenberg learned at Emory is that business is the most powerful vehicle for change in society. “During a mid-semester module in South Africa, we visited a company that made banking accessible via a cell phone sim card. Because of that company’s work, a population without access to traditional banks could now deposit, transfer, and withdraw money with ease,” she says.

Banjo remains a “principled leader,” a core value she learned at Goizueta. “As my career has gone on, I have come to recognize how important this truly is.”

Whether you are in corporate America or in business, you’ll be called to task to lead, even if you do not have leader in your title. As a leader, you have to be sure you are walking the walk, not just talking the talk. Your legacy is created every day.

Lola Banjo 11MBA

Banjo is true to her word. For Silver & Riley, five percent of every sale is funneled into grants to help launch, grow, and scale female-led businesses. The first round of $1,000 has grown into $10,000.

Even with challenges, Goetz says it’s not surprising that women are overcoming them and holding their own. “Women are more determined than ever to become entrepreneurs.”

Banjo accumulated 136 rejections from manufacturers—but two others said yes. “Never give up. When you’re first starting out, you’ll hear ‘NO’ a lot. Your breakthrough is just around the corner! Every ‘NO’ is one step closer to a ‘Yes.’ Keep going for your dreams.”

Carter learned the meaning of success and credits Mellody Hobson, president and co-CEO of Ariel Investments, for the insight. “Success is truly a function of how you define it, not anyone else. Hard work plus bravery equals success.”

She admits that every person has their own definition of hard work but, it doesn’t matter. “Hard still means overcoming adversity, obstacles, and challenges. For me, bravery is the ability to be bold, fearless, and true to yourself and your beliefs. For instance, we’re not looking to be just another bridal shop. We’re taking advantage of new technologies not only to cut costs, but also to unlock massive value so we can maintain our first-mover advantage and stay two steps ahead or our competitors.”

Stories of creativity and determination help define women entrepreneurs, says Goetz. “I have to give them credit. They can handle a lot more than men. I don’t know how they do it. But they do.”

The Roberto C. Goizueta Center for Entrepreneurship & Innovation serves as the resource hub for student and alumni entrepreneurs, early-stage investors, startup launch accelerator participants, and ecosystem collaborators. On March 31 and April 1, the center will host the 2022 Emory Entrepreneurship Summit featuring keynote speaker Vivek Garipalli 00BBA, Co-Founder and CEO of Clover Health. Register for the summit today.

As part of the center’s outreach, the Peachtree Minority Venture Fund is the first-of-its-kind student-run million-dollar venture capital fund focused on underrepresented founders. Learn more.

Goizueta students interested in entrepreneurship, innovation, and early-stage investing are invited to apply to become student fellows of the center. Applications are now open.

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It is also no surprise, given the long list of entrepreneurship initiatives fostered by The Roberto C. Goizueta Center for Entrepreneurship & Innovation, that Goizueta Business School was not only a major sponsor of this year’s third annual Siggie Awards, but also hosted this year’s ceremony, one of two events organized through the center on November 12, 2021. The center also hosted the 13^th semi-annual RAISE (Retention and Advanced Investment for the Southeast at Emory) Forum on November 12. An invitation-only event, the RAISE Forum connects startups seeking funding in the $500,000 to $5 million range with venture capitalists and angel investors from across the Southeast.

Celebrating the Ingenuity of Entrepreneurs at the Annual Siggie Awards

“Over the last few years, as part of Goizueta’s strategy, we have been consistently growing our entrepreneurship and investing initiatives into a complex portfolio to serve the venture aspirations of our community, from students to alumni,” said Robert Kazanjian, senior associate dean for strategic initiatives and academic director of The Roberto C. Goizueta Center for Entrepreneurship & Innovation. “The Siggie Awards complements the building of a network of investors across the entire Southeast, which starts with programs like the RAISE Forum and fits the growing number of startups we’re helping to fund.” 

One of four 2021 Siggie Awards’ winners, Sid Mookerji 04MBA, founder and managing partner of Silicon Road Ventures, took home the Horizon Award, given to a rising early-stage investor. Mookerji called it an “immense honor” adding, “It’s a great time to be in business in Atlanta.”

The Investors’ Choice Award, given to an early-stage investor who embodies the spirit and vision of Mosley as nominated by their peers, went to Ron Love, Founder & CEO at RoLo Capital Group.

Sean O’Brien, Managing Partner, Overline VC, took home the Founders Favorite Award, given to an early-stage investor who is deeply committed to helping startup founders launch and scale their ventures. O’Brien founded Overline VC along with Michael Cohn 05MBA. During the Siggie Awards’ ceremony, O’Brien said that the work being done at Overline is “an extension and continuation of the work that’s defined [Sig’s] career—which is helping founders get funding at the very earliest stage of their business.”

The Conscious Capital Award, honoring an entity, institution, or individual with a track record of supporting and investing in entrepreneurs and innovative solutions that achieve a measurable social impact in communities in Atlanta and beyond, went to Christy Brown, President, Launchpad2X and a 2021-2023 CEI Entrepreneur in Residence.

Additionally, $4000 of the sponsorship proceeds from this year’s Siggie Awards ceremony went to The Scholarship Academy (TSA), a nonprofit organization dedicated to helping low-income students create a healthier financial aid culture and secure resources to pursue higher education opportunities without debt.

“It’s my hope the [Siggie Awards] will continue to recognize investors who have taken the time to help entrepreneurs get their startups to a fundable stage and who have also led the charge to secure for them the all-important seed round,” said Mosley. “I’m incredibly proud of what we in the investment and startup communities have collectively achieved.”

Kazanjian and Amelia Schaffner, founding director of the Center of Entrepreneurship and Innovation, served on the Siggie Awards’ 2021 Host Committee. Saif Nazrul, 23MBA and CEI fellow, acted as the 2021 Siggie Awards program manager. Goizueta is slated to host the event again in 2022.

Created by angel investment enabler Barry Etra and Charlie Goetz, senior lecturer of Organization & Management, the RAISE Forum has seen funding awarded to approximately 28 percent of RAISE Forum startups. (Steven Goudy MD 19EMBA, associate professor and director of pediatric otolaryngology at Emory School of Medicine and founder and CEO, Dr. Noze Best, was one of seven presenting companies at this year’s RAISE Forum.) According to Goetz, helping startups secure investments makes it more likely they’ll stay in the Southeast “as they grow” and ultimately, he explained, “become an important part of our business community.” Startups in any field are encouraged to apply to present at next year’s RAISE Forum by visiting www.raiseforum.com/entrepreneurs.

Are you an alumnus/a, community entrepreneur, innovator, or investor ready to work with Goizueta Business School? Please read more about the many initiatives of The Roberto C. Goizueta Center for Entrepreneurship & Innovation.

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Physicians and entrepreneurs, while seemingly in different orbits, often embark on their professional journeys with the same motivation: the desire to help people. That’s certainly the case for pediatric ear-nose-and-throat specialist Steven Goudy, MD, 19EMBA, who has embraced both professions. Six years ago, the Kentucky native joined the Emory School of Medicine and Children’s Healthcare of Atlanta. Now, as associate professor and director of pediatric otolaryngology, he treats newborns, teenagers, and all ages in between. Even before his arrival, pursuing an MBA was on his mind. 

“My dad was a small business owner,” says Goudy, founder and CEO of his company Dr. Noze Best. “He’s retired now but it was clear growing up that being business-minded was a genetic trait, and I had an interest in the intersection of business and medicine.” 

A father of three, Goudy knew well the challenges of caring for small children from his own experience and from the parents of his patients. One issue he wanted to address was the inadequacy of home-use nasal aspirators for babies, who are unable to breathe through their nose when they have a cold. He began noodling ideas that would eventually lead to partnerships with engineers, other business professionals, and in 2015, a patent for the NozeBot, a rechargeable battery-operated, hospital-quality nasal suction device for congested babies. 

 The Doctor “Noze” Best 

Shortly thereafter, he founded Dr. Noze Best but realized he lacked the business acumen to grow it into a successful company. So, he began pursuing an MBA from Goizueta Business School. 

“In my mind, I knew what I wanted to do but I didn’t really have the skill set to do it,” he says. 

“He came into the program because he wanted to build products to help solve problems of pediatric parents and children, and to learn how to be more entrepreneurial,” says Charles Goetz, author and senior lecturer in Organization & Management and distinguished lecturer in entrepreneurship at Goizueta. 

With advice from Goetz and other Goizueta mentors, along with the knowledge he gained from the EMBA program, Goudy began to flesh out the manufacturing and marketing of NozeBot and build the business. After pandemic-related delays in 2020, he launched the product early this year. So far, parents are raving about its ease of use and effectiveness. 

Identifying Pain Points and Solving Problems 

Goudy now has three executives to help him manage the company while he sees patients, teaches, and runs a National Institutes of Health-funded research lab. His direct interaction with patients, parents, and his research colleagues has given him the idea for product No. 2. 

“For me, it’s about identifying what are the pain points and how do we offer education and solutions to families to address those,” he says. 

As far as advice he would give to aspiring entrepreneurs, he explains, “You need to be able to really think about the business case to say whether it’s worth investing a lot of time, energy, and money of your own. Because at the end of the day, it’s not a linear road.” 

“He had a dream, and he went after it,” says Goetz. “You’ve got to give somebody a lot of credit for that. It’s about passion, and passion is the best thing to drive people.” 

Learn more about programs and resources for entrepreneurs at The Roberto C. Goizueta Center for Entrepreneurship & Innovation.

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SPACs are having a moment. 2021 is barely through its first quarter and the number of SPAC IPOs has surpassed 2020’s grand total of 248 and their $83 billion in collective proceeds. At the moment, there are over 400 SPACs—Special Purpose Acquisition Companies—on the market, each seeking a private company to take public. Even celebrities like basketball great Shaquille O’Neal and tennis star Serena Williams have joined the SPAC boom.

The current SPAC frenzy has led to predictions that the SPAC market is a bubble ready to burst, but Klaas Baks, professor in the practice of finance and executive director, Emory Center for Alternative Investments, doesn’t see it that way. He points to financial practices such as leveraged buyouts and securitization, both considered suspect in their heyday, but that are mainstream today. “We’re in the first inning of SPACs,” said Baks.

SPACs defined

SPACs have been in existence since 1993. Historically known as blank-check companies, SPACs are shell companies that list on a public exchange (such as the NASDAQ or NYSE) with the sole purpose of acquiring a private “target” company (or companies) to take public within a set timeframe, generally 18 to 24 months. Like all IPOs, SPACs raise capital from third-party investors. Unlike other IPOs, nearly all the capital raised is placed in a trust and later used to acquire the target company. Since target companies aren’t yet identified when the SPAC goes public, the expertise and reputation of the SPAC’s “sponsors,” oftentimes former CEOs and large asset managers, are what attracts investors. When the private company and the SPAC merge (“the business combination”), the newly acquired company adopts the SPAC’s spot on the public exchange, thereby becoming a public company.

According to Baks, SPACs are coming into their own for several reasons: recently updated rules and regulations around SPACs, a glut of capital in search of investment, and a seemingly infinite number of private companies wanting to go public. “This generation of SPACs has the right economic equilibrium between investors, sponsors, and companies that want to go public by merging with a SPAC,” noted Baks.

SPACs help close the gap between private and public markets

Before the dot.com crash in 1998, there were more than 8000 publically traded companies. Today, there are roughly 4000. “There are a lot more dollars chasing fewer companies,” noted Rahul Wadhwa 20BBA, associate, Navigation Capital Partner’s SPAC Operations Group. Wadhwa was in his final semester at Goizueta when he learned about SPACs as Baks’ research assistant. “SPACs bridge the gap between public and private markets,” he explained. “Once you have an understanding of how many companies the venture capital (VC) world has invested in and how many the private equity (PE) world is backing, what’s happening with SPACs starts to make sense.”

In 2020, according to PitchBook, a financial data company, private equity firms completed more than 5300 deals with a total deal value of more than $708 billion in the U.S. Statista.com puts the value of VC investments in 2020 at approximately $130 billion. “There is a desperate need for these funds to exit their investments,” Wadhwa said. Navigation Capital Partners’ website estimates that global dry powder—funds looking for investment opportunities—totals $2 trillion. If the current SPAC IPO pace continues, 2021 totals would hit 1000 SPACs with proceeds of more than $300 billion. That would still leave $1.3 trillion in dry powder in search of investments. “It’s been wild out there,” said Wadhwa. “But if you look behind the curtain, it’s justified.”

Creating the SPAC

In exchange for their initial investment as well as the time and effort needed to find and acquire a private company, SPAC sponsors receive shares equal to 20% of the total shares outstanding after the SPAC IPO. For example, a sponsor that invests $8 million in a $200 million SPAC will receive 5 million shares. Sponsors also receive founder warrants, which give them the right to purchase additional shares later, at a fixed price.

On the downside, if the sponsors don’t find a company to acquire, the sponsors lose their initial investment. “But there is a tremendous upside,” noted Baks. “There is a lot of money to be made.” A recent study by JP Morgan noted that, on average, SPAC sponsors make a return of almost 10 times their investment.

Typical SPAC sponsors include outfits such as Blackstone, Goldman Sachs and Citigroup. VC and PE firms have begun their own forays into SPAC sponsorship—often raising more money in less time with reduced risk than they could in the private market. One of the best known SPAC sponsors is venture capitalist Chamath Palihapitiya, a former Facebook executive and the founder and CEO of Social Capital. In the last three years, Palihapitiya has invested in six SPACs, including one that took commercial aerospace company Virgin Galactic public in 2019. Forbes estimates Palihapitiya has received returns of roughly $1 billion from his six SPACs.

Different investors at different stages

Since SPACs are shell companies until the business combination, at IPO, all SPACs have the same structure. IPO investors receive “units” priced at $10/unit. (Units are comprised of shares, warrants and/or rights.) Shortly after the IPO, the SPAC splits the units into its various elements—shares, warrants and rights—after which each element can be traded separately. All investors that purchase shares prior to the SPAC’s business combination receive “redemption rights,” or the right to recoup their investment, with interest, if they don’t like the SPAC’s proposed acquisition. “What’s really unique about this is that you’re limited on the downside,” said Baks.

Investors in SPAC IPOs include the so-called “SPAC mafia,” a concentrated group of Wall Street insiders and hedge funds. However, the vast majority of “SPAC mafia” investors redeems its shares or sells them pre-merger. According to Forbes, by doing so, “SPAC mafia” firms routinely notch returns of around 20 percent. After these investors redeem their shares, that capital needs to be replaced.

To ensure the SPAC has sufficient funds to acquire the target company, SPAC sponsors often seek “backstop” or PIPE—private investment in a public entity—financing. This capital tends to come from a small pool of investors, including institutional investors and, more recently, VC and PE firms. PIPEs are attractive to investors as they are able to buy shares in the SPAC for below market value. They’re also given more access to the target company’s financials, which helps validate the price of the target’s acquisition.

The Retail Investor

Lured in by the buzz around SPACs, retail investors are increasingly buying shares in SPACs. One of the best performing SPACs of 2020, DraftKings went public via SPAC last April. In late March, DraftKings stock was trading around $67 per share—significantly more than its $10 initial offering. However, a 2020 study by the Financial Times found that the majority of companies that went public via SPAC between 2015 and 2019 were trading below $10 per share.

In addition, Wadhwa cautions that SPAC shares “are really not like normal stocks,” he said, referring to the breaking of units into shares, warrants, and rights after a SPAC goes public. If SPAC IPO investors decide to exercise their warrants, that act can greatly dilute a retail investor’s shares. “When you invest in SPACs you’re getting more [than a regular stock]. It’s a bundle of securities that you can potentially redeem,” Wadhwa added.

Why do target companies sell to a SPAC?

Assume there is a high-growth technology company with $50 million in annual revenues and a private equity valuation of six to eight times revenue, or $400 million to $600 million, posited Charlie Goetz, senior lecturer in Organization & Management and distinguished lecturer in Entrepreneurship. “Sounds nice, right?” he asked. But, Goetz added, if this high growth company were public, it could easily have a price-to-earnings ratio of 30—meaning investors in the public market would value the company at 30 times its current earnings—or $1.5 billion. “A hot technology company will find that the private market won’t pay it what the public market will,” explained Goetz.

That said, noted Goetz, the sweet spot for private companies wanting to go public via SPAC is in the $200 million to $700 million range. Traditional IPOs tend to be reserved for “unicorns” such as ride-sharing stalwart UBER, which had a 2019 IPO valuation of $82.4 billion. According to SPACinsider, in 2020, the average SPAC IPO was $336 million. SPAC IPOs also face less stringent regulatory hurdles than traditional IPOs. As an added bonus, the leadership teams of SPAC-acquired companies tend to retain control of their companies, unlike many PE-backed firms.

SPACs—going forward

In 2020, only two SPACs failed to merge with a target company, a success rate of 97 percent. But as the number of SPACs increase, Wadhwa expects the number of SPAC failures to rise. “You’re always going to have bad apples,” he said.

That said, Wadhwa believes SPACs are here to stay. “Ten years from now SPACs will still be strong because they’re a useful tool,” he explained. “The SPAC space is a great place to be.”

Find out more about topics like cryptocurrency, frontier markets, and the importance of SPACs on our economy at The Center for Alternative Investments at Goizueta.

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Charlie Goetz, senior lecturer in organization and management and distinguished lecturer in entrepreneurship, is a serial entrepreneur, an active investor in more than a dozen businesses, and partner in an African nonprofit focused on developing healthcare solutions for Africans. Goetz is responsible for starting and building new ventures in a number of industries, including banking, healthcare, radio broadcasting, sports, real estate, and advertising. Since 2001, Goetz has taught classes on entrepreneurship and business development at Emory’s Goizueta Business School.

In this interview, Goetz addresses why now is a good time to start a business, why there’s so much capital available and where to get it, and a few tips on how to position your startup for success.

EB: From an entrepreneurship standpoint, what are you seeing right now?
Goetz: One of the things we see is that during bad times there’s a lot more entrepreneurship happening. New ventures are starting, and there are a number of reasons for that.

EB: So the silver lining of hard economic times is new business growth?
Goetz: Correct. A lot of companies get started because people are either losing their jobs or think opportunities at their current company are limited. Also, research shows that this could be a good time to take a step away and start a new business. Starting a business in difficult economic times makes finding good people easier, cost of product development is often less expensive and because people are no longer sure of their future at their large employers, they are frequently willing to take more chances and work for lower wages and stock options at startups.

In addition, bad economic times can often take out weak competitors, leaving customer opportunities that would not have been there in good times. For those who move forward and start their businesses, often by the time the economy comes back, these new ventures are up and running and they hit the market fast, which is usually one of the keys to being successful. It is not uncommon for companies that start during a big recession or economic downturn to have successful exits in five to seven years. Frequently, after a bad downturn, an economy is running at full tilt five to seven years later.  

EB: How are these upstart companies getting funded right now?
Goetz: While the most common funding process for incorporated businesses are still savings and friends and family investment, there is a definite increase in demand for SBAs—Small Business Administration loans. SBA loans can fund up to $5 million, although the vast majority are for significantly less money. To get an SBA loan, find out if your local bank offers them. If not, other banks will. Try to bank with community banks (small local banks) as they are much more interested in your startup business than the large ones.

EB: What’s your take on the U.S. government’s response to aiding small businesses during this COVID-induced downturn?
Goetz: To date the government has done some good things for small businesses. The most effective program for small businesses has been the Paycheck Protection Program (PPP) under the CARES Act. It provided small businesses with $525 billion through approximately five million loans. That’s more loans by value and volume than all the loans the SBA has ever approved in its 67-year history. In addition to PPP, the SBA’s traditional loans exceeded $28 billion at the same time, and some of that was through its microloan program, which gives aspiring entrepreneurs access to capital in loans of up to $50,000.

EB: So, it sounds like a good time to launch a business, but what are the options for those seeking to exit existing businesses?
Goetz: Right now, there is a huge amount of cash available on the sidelines. Specifically, during recessions investors try to play it safe and will hold onto cash. Now that the market has come back significantly and interest rates are still so low, investors are looking for good places to invest their money. Consequently, this may be a good time to start a business or to sell a business that is already up and running. Prices for businesses have skyrocketed this past year.

EB: In 2019, 90 percent of all startups failed. Any advice for entrepreneurs on how to be a part of the 10 percent that are successful?
Goetz: Be very careful of this statistic. It is heavily skewed to mom-and-pop businesses. Businesses that are incorporated do not fail at this high of a percentage. In reality, 90 percent of startup businesses do not fail. Some of that percentage includes businesses that get out of their business, frequently due to retirement and other reasons. That said, there are a significant portion of companies that do fail. While there are no perfect solutions to being successful, there are definite things you can do to increase your probability of success. Here is just a very small sample:

1. Take time to really understand your market. The key here is to spend a lot of time and effort determining exactly what your customers really want and then do everything you can to give it to them.
2. Understand what your potential competition looks like. Are there direct competitors? If not, are there indirect competitors? By the way, if you tell a seasoned investor that you have no competition, they will laugh at you, and when they are laughing, they don’t invest. Instead, focus on what are the strengths and weaknesses of your competitors? Try to identify why competitors are not able to satisfy your market’s demands.
3. Design your product. Once you have done your market research well and know what your market really wants, you then need to develop a design for your product/service and run the design past your prospects to determine if you make it, will they buy it? If not, why not?
4. Start charging. If your prospects tell you they’ll buy your product/service, try to get some payment from them upfront, even if it means giving them a good discount when you have built it. After you have a sufficient number of prospects agreeing that they will buy your product/service if you make it, you will need to either develop the product or service yourself or find someone who can. Do your due diligence on who you are having develop the product/service. It is not unusual for a small company to hire the wrong people/companies, and by the time they realize they’ve made a mistake, they are out of money and time. Be very careful here.
5. Develop an effective marketing and sales plan. Once your product/service is being developed, it’s critical you spend significant time developing an effective marketing and sales plan. And a big warning:The number one reason why small businesses fail is due to lack of sales.No matter how good your product is, marketing and sales are difficult processes. The overwhelming percent of prospects don’t like to try something new; your company has little to no credibility, and there is a concern you may not be in business if there is a problem with the product down the road. In addition, sales don’t come from heaven. There is a direct cause-and-effect relationship. You do a marketing tactic, it drives leads, which in turn you give to your salespeople, who in turn close a percentage of those sales.
6. Identify a niche. To overcome this, I recommend that you identify a niche that is underserved rather than targeting the entire market. Then design your product specifically for that target market. Since your product/service is exactly what this subset of the market wants, they buy it. Once they buy it, you can get good recommendations, which you will use for building your company’s credibility.

EB: Besides building businesses, are you investing in businesses too?
Goetz: At the moment, I’m invested in 12 different companies. Over the last three years I have changed my focus from investing in companies solely for their investment potential to companies where I can do both good and do well. Meaning, not only does a good return matter, but the companies must have products that can help people live a better life. Consequently, a lot of those investments are in healthcare companies. 

EB: Do you also consult for these companies or is this strictly monetary for you?
Goetz: Sometimes I’ll have positions on the board. Not always. It depends on the time commitment and whether or not they need me. If they have somebody who has the same skill set I do, then no. But it’s mostly about the time commitment. I can’t be on everybody’s board.

EB: And speaking of time commitments, what about the classes you’re teaching?
Goetz: I have a full load this semester. I’m teaching Intro to Entrepreneurship, Applied Entrepreneurship, and Entrepreneurial Practicum and always doing a lot of directed studies with students.

EB: What is Entrepreneurial Practicum?
Goetz: There are a lot of pieces to it, but essentially it’s a class where our students work with entrepreneurial companies and are assigned a project with those companies. Each student gets a project. Not only do they learn about entrepreneurship, but the students also help us identify startup companies for the RAISE Forum.

EB: Remind readers about the RAISE Forum.
Goetz: By teaching students how to identify the best companies for the purposes of the RAISE Forum (Retention and Advance Investment for the Southeast at Emory Forum), they learn what companies need to do to make themselves successful. To date, we have done 11 RAISE Forums and over 32 percent of the budding companies who pitch their businesses have received funding from the investors we invite to our forum. Each semester, almost 100 entrepreneurial companies in the Southeast who are in-revenue, apply with hopes to get one of the seven spots to present to our investor groups. Our investor groups include “super angels,” venture capitalists, and private equity companies.

EB: During this time, do you feel optimistic about business?
Goetz: I feel bad for those businesses in hospitality—like restaurants or hotels. There are a lot of those businesses that either won’t be coming back at all or won’t be returning to the level where they were before the pandemic. But the higher level businesses, the more professional businesses, they’ll probably be fine. On the whole, they’ve gotten through this pretty well and many of them have done better than they thought, even before COVID-19 hit.

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When startup companies’ growth accelerates rapidly, debt or equity capital often emerges as a top priority. On May 15, seven regional businesses earned the right to pitch their strategic plans and funding goals to an invitation-only audience of investors during the first ever virtual RAISE Forum. RAISE, which stands for Retention and Advanced Investment for the Southeast at Emory, began in 2015. Since that time, nearly a third of invited companies have been successfully funded. “Because of travel restrictions around COVID-19, we moved this Spring RAISE session online,” said Forum co-founder Charlie Goetz, Goizueta distinguished lecturer in entrepreneurship. “Going virtual enabled a record-breaking 83 qualified investors to participate from their home bases.”

The primary goal of the RAISE Forum is “to fuel the Southeastern entrepreneurial ecosystem by connecting early-stage in-revenue businesses to qualified regional investors, then keep those businesses here long-term to strengthen our economy,” explained Goetz. “The RAISE Forum is very committed to growing the entrepreneurial ecosystem in the Southeast.”

“We are laser-focused and purposeful on the goal of funding startups. We are committed to connect investors and startups directly so they can reach their common goals of funding without distractions,” said Amelia Schaffner, Goizueta director of entrepreneurship. “We aim to help companies get through the funding stretch often referred to as the ‘Valley of Death,’ during which funding needs often exceed revenue. It is tricky to cross that chasm, and it is especially important for companies to find early-stage investors.”

Barry Etra is president of the Keiretsu Forum Atlanta, and co-founder of the RAISE Forum. “This unique event is held at Goizueta twice annually, once in the spring and once in the fall. Presenting companies are guaranteed quality time to interact with investors through sharing their pitch, a Q&A session, and private breakout rooms.” The Forum does not take any equity or money from either investors or startups.

Seven business leaders earned the chance to present at the Spring 2020 RAISE Forum. They were Michael Biron, CEO of Altis Biosystems, Angela Fusaro 01C 17EMBA, CEO of Physician360, Brian Handly, CEO of Reveal Mobile, George ‘GB’ Pratt, CEO of ModifyHealth, Christian Ries, CEO of JonnyOnIt, CEO Kerry Schrader and President Ashlee Simmons of Mixtroz, and Mark Engelen, CEO of RXLIVE Inc.

“For future sessions, we’re seeking a broad portfolio of applicants from software to manufacturing to match our expertise in healthcare, fintech, and growth,” Etra said. “Applications are always open.”

Participants Perfect the 8-Minute Pitch for Investors

To participate in the RAISE Forum, investors must meet certain rigorous criteria. “We allow only investors who are based in the Southeast, are able to write a $250K check, and are active investors,” said Etra. “We have something at RAISE for everyone.”

Applicant companies need not be affiliated with Goizueta but must be in-revenue or have contracts and deals in hand. The company’s product or service must have a proven business model. Though companies should be seeking an investment round between $500K and $5MM, “they should need the funds to scale up or increase their current capabilities,” Goetz explained. “Selected companies must also agree to attend Goizueta training to refine their pitch.”

In-depth preparation is critical. Schaffner noted that lead-up to the Forum is the final part of the classroom entrepreneurship practicum. “Students are involved in working sessions. They work closely with Goizueta and industry coaches to screen the startups in a pre-diligence process, learning the language and tools of early investing, as well as witnessing the coaching process that startups undergo to make their pitch more appealing to investors. The university’s goal is to provide students with the foundational skills to grow their business or become an investor, whichever route they might choose. In addition, the Forum provides a great opportunity for Goizueta to grow relationships with the early-stage investor community, should our own startups need funding for themselves.”

During the RAISE Forum, investors and startup companies are on a level playing field in what Etra has dubbed “a pure funding environment.” Presenters are given eight minutes to pitch, followed by a seven-minute open question and answer session. Compared with other rapid fire pitchfests this session’s companies have participated in, the RAISE Forum’s eight-minute format is called “the sweet spot.” All participants appreciated the precise follow-up questions by investors and looked forward to providing more detail in the post-Forum, private breakout rooms for each company to meet with interested investors.

Investors are not shy about asking the tough questions of presenters, and in turn, good business leaders know their facts. This year, investors needed more details about patents and proprietary technology, timing on grants, specific competitors, compatibility issues, consumer awareness drivers, consumer buy-in, liability and privacy concerns, customization and white-label options, sales models, average ticket price, distribution, year-to-date revenue, revenue share, billing, enterprise valuation, lead investors, and exit opportunities and strategy.

“What makes the RAISE Forum unique is the investors-only discussion” after each presentation, said 2018 Forum participant Jeff Williams, partner at Baseline Capital Group. Also participating in 2018, investor Michael Schwartz 03MBA, head of strategy and capital markets at Hive Financial Systems, said he appreciated “Emory coming back to the community and having a very finely curated group of investors, who are not only just about money but are willing to be active and provide guidance. It’s really collegial.”

Open Call for Startups to Apply

Tapping into relationships with incubators, investment groups, and venture capitalists, the RAISE Forum puts out an open call for startups to apply online for future consideration.  From the applicant pool, candidate companies are narrowed down to the top seven or eight. “By narrowing down from a pool of 50-70 applicants to 15-20 semifinalists to 7 presenters, we ensure as high a quality cohort as possible,” said Etra.

The success stories continue to grow. “When we started the RAISE Forum, we wanted to beat the national pitchfest funding average of one to two percent by a factor of ten. We are proud to say we have done that,” said Etra. “In addition, one of our participant companies has made a successful exit.”

Startups that did not meet the criteria to participate should continue to apply for consideration. “It’s important that we run the RAISE Forum every six months,” said Etra. “You may be too early now, but next time you might not be. Many of our finalists have been through this process at least once. Keep trying and know that everybody who is interviewed gets personalized feedback on their progress.”

A regular RAISE Forum participant, Goizueta’s Entrepreneur in Residence Sig Mosley 68BBA, affectionately known as the “godfather of angel investing in Atlanta” and managing partner of Mosley Ventures, has invested in 132 startups and had 105 liquidity events, and is responsible for the largest venture deal in the Southeast, the $5.7 billion acquisition of Tradex by Ariba. In his honor, Goizueta hosts the Siggie Awards to reward early-stage investors in Atlanta. Nominate a candidate today.

Learn more about how your company can participate in the RAISE Forum.

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“The healthcare marketplace is not really equipped to change. The more innovative and disruptive your product is, the more you’re most likely displacing something that a lot of capital has already gone into.”

This insight, from Jim Millar, founder and principal of the Vine Group and principal of CVG Advisors, was shared with investors, entrepreneurs and members of the Goizueta community at the Miller-Ward Alumni house on September 19. He pointed out that while logic dictates that if a product works and save lives it will be well-funded, “that’s not reality.” He advised entrepreneurs to go into capital raising with a good understanding of what their product may be displacing.

Millar was one of the leading inventors, investors and entrepreneurs in the healthcare industry discussing innovation in healthcare on the RAISE (Retention and Advanced Investment for the Southeast at Emory) Forum “Rise” Panel, a popular panel event that provides interested members of the public an opportunity to network and hear from industry experts ahead of the biannual, invitation-only RAISE Forum, which brings together early-stage companies based in the Southeast with potential investors and mentors.

Millar was joined by Dr. Scott Boden, chairman of the orthopedics department at Emory School of Medicine and vice president of business innovation at Emory Healthcare; Dr. Angela Fusaro 01C 17WEMBA, co-founder and CEO of Physician 360; and Dr. Arik Hanannel, CEO and co-founder of FUSMobile. Steve Brett, executive coach and founder of Presentation TuneUps, moderated the panel.

The panelists discussed the challenges that make change and innovation—difficult endeavors in any industry—even harder within the healthcare landscape.

Navigating the necessary regulations is often one of the first hurdles entrepreneurs face after demonstrating the efficacy of a new product or technology. But it’s far from the last.

Like any innovation, a new healthcare product must also make economic sense to have any chance of success. In the healthcare industry, there is an additional consideration: will insurance companies cover its use? “And still, this is not even the highest step,” said Hanannel, “because even after you get regulator approval and get coverage, the next, bigger step, is medical acceptance.”

Physicians, nurses, or other healthcare workers must be willing to embrace the change an innovation necessitates. “Sometimes the thought leaders aren’t the end users,” Boden pointed out. And end users like physicians may not be interested in trying something new.

“They’re trying to get through their day, which is packed and packed with more volume, and they’re trying to improve quality, and the last thing they’re trying to do is new and different and changing routines,” Boden said.

So far, Fusaro and Hanannel have been able to find success despite the harsh environment for entrepreneurs.

Physician360 faced potential pushback from primary care physicians: Fusaro’s telemedicine platform offers simple diagnostic services that often eliminate the need for a trip to the doctor’s office. “The challenge there, the opportunity there, is how you frame that,” Fusaro said. In her conversations with primary care physicians, Fusaro emphasized how her service steps in when physicians can’t: after hours, on weekends, at short notice. “Part of the challenge is getting that level of understanding,” Fusaro said. “There’s a lot of ongoing conversation about that.”

Hanannel’s focused ultrasound technology can serve as an alternative to surgery or radiotherapy, potentially transforming the treatment of many medical disorders. Hanannel feels confident FUSMobile hits the right balance. “We’re at a cheaper, faster, better version,” he said. “It’s a disruptive value in a non-disruptive envelope.”

At the conclusion of the discussion, the panelists shared their visions of healthcare innovation over the next decade. In the coming years, the panelists hope to see a cure for cancer, elimination of stigma from mental health treatment and advancements in the human-machine interface and data analytics.

The event was hosted by Charles Goetz, distinguished lecturer in entrepreneurship and senior lecturer in organization and management at Goizueta; Amelia Pane Schaffner, director of entrepreneurship at Goizueta and RAISE Forum co-founder Barry Etra.

The next RAISE Forum is November 15, 2019 at Goizueta Business School. For more information visit http://www.raiseforum.com/candidate-application

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