Why Investing in Entrepreneurs Tops Crowdfunding

[ 0 ] April 5, 2015 |

Rick Timmins has invested in and mentored many start-up companies in the Austin community. With more than 35 years of experience in financial management and strategic guidance from two Fortune 100 technology leaders, he likes to lend his hand to the next generation of entrepreneurs.

Watch Rick Timmins, Board Chairman of Austin’s Central Texas Angel Network (CTAN), as he discusses the importance of mentoring entrepreneurs and why crowd funding just doesn’t hold a torch to investing in entrepreneurs:

Timmins, who is the former Assistant Chief Financial Officer at Cisco Systems and a former Vice President of Finance for Motorola, describes two types of funding: crowdfunding and investing in an entrepreneur; the latter, he says, is better.

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Crowdfunding is usually an Internet-based platform used to raise money toward initiatives by soliciting donations of any size from large groups of people. However, Timmins, who prefers to invest in something and watch it grow, is not a fan. “The crowdfunding opportunities don’t lead you to the determination or the metrics around the evaluation of an entrepreneur,” says Timmins. “Often times,ideaGraphics those opportunities are based elsewhere.”

Instead, Timmins would rather invest in entrepreneurs. He not only supports them financially, but he also mentors them so they can grow and accomplish more. “Ninety percent of what we invest in is based on entrepreneurs that are located here in Austin,” he said. “Not only do we make an evaluation of them, we continue to help mentor and work with them once we’ve invested in them.”

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Although Timmins acknowledged that crowdfunding is a great way for businesses to earn money toward their ventures, it doesn’t, he says, lead to a mentorship and possible further growth for both the company and the investor(s). “That crowdfunding opportunity doesn’t present itself or lend itself well to that kind of pre-investment due diligence and post-opportunity to continue to mentor and work with an entrepreneur.”

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About Rick Timmins: Rick Timmins, chairman of the board of the Central Texas Angel Network, is a resident of Austin heavily involved in the Austin start-up community. He brings with him 35 years of experience in financial management [...]
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