Report ranks New Mexico Angels No. 3 most active among global startup networks

Stuart Rose believes startups need more than funding to be successful.

“Money isn’t enough. It’s essential, but it’s not enough,” Rose, founder of the BioScience Center in Albuquerque, said.

More than that, Rose said startups also need various connections, an understanding of their customer base and the knowledge to take a product to market. Enter the New Mexico Angels, whose members invest in a multitude of startups and provide those types of services to companies looking to grow.

The organization was recently ranked the third most active network out of 72 in the Angel Capital Association in a new report.

Drew Tulchin, New Mexico Angels president, said the report, titled “Angel Network Pulse: The First 101 Deals,” was the first of its kind released by the association. The report, released last month, analyzed $288 million in funds raised between networks over the last nine months.

“It’s a testament to our entrepreneurs here in New Mexico, it reflects on the investors that are here in New Mexico, and it reflects how active we are as a community with business people helping other business people,” Tulchin said.

The report listed four New Mexico Angels portfolio companies — Spiritus, GridFlow, Terra Vera and YEEO — as being backed by the organization. New Mexico Angels members fund Terra Vera and YEEO via the New Mexico Vintage fund, Tulchin said.

Tulchin said members aim to help homegrown New Mexico companies, as well as those looking to do business in the state, noting that their portfolio reflects this and shows a strong indication of the growing market.

Like most business relationships, Tulchin said the New Mexico Angels often question where it’s helpful to a startup. Candidly, he said checks from his organization are typically smaller than other investment groups, so members go deeper with giving startups guidance and connections.

Rose said the BioScience Center helps those startups by providing laboratory space as part of its partnership with the New Mexico Angels.

When Rose founded the BioScience Center in 2012, he said the New Mexico Angels existed, but operated differently than it does today. Back then, the group was only made up of volunteers and it had no funding to give — they just pitched companies to other investors.

“The Angels have evolved over that time,” Rose said. “They have people who now invest more than $25,000 or $50,000; they’ve also created a fund and have added advisory services. They’ve created much more breadth in what they offer to the startup community.”

Kevin Pope founded YEEO, a company offering environmentally friendly, all-natural mosquito control products using yeast-encapsulated essential oils, nearly three years ago. Currently operating out of the BioScience Center, he said the New Mexico Angels have been with them from the start.

Pope originally planned to license and establish YEEO in Florida, where he is based. But after visiting Albuquerque and meeting Tulchin, he found a passion and energy for startups that he hadn’t seen before. Along with $200,000 in funding from the New Mexico Economic Development Department, the deal was sealed.

“I ran around Florida looking for folks and didn’t get as much interest, so I thought, ‘Yep, New Mexico is where it needs to stay,’” Pope said. “We like being a New Mexico venture, there’s just a lot of energy in New Mexico that a lot of other states — that talk a lot — don’t have.”

Pope was not at all surprised by the high ranking the New Mexico Angels received in the report. Without the organization being a committed investor at the time of the EDD grant, he said Tulchin began helping YEEO “from the get-go.” Connecting the company with a network of expertise, offering mentorship and getting the wheels turning, Pope said the group still asks how it can help.

“That sort of energy is really what it takes to keep something like this going,” Pope said. “You can’t just throw a few things out to the winds and hope they come back. You’ve got to drive, and Drew and the Angels definitely do.”

Charles Call, founder and CEO of GridFlow, said the startup is commercializing lithium sulfur flow battery technology, which was licensed from Sandia National Laboratories. The company and the New Mexico Angels interact regularly, he said, and Tulchin often shares opportunities, potential investors and training.

With GridFlow, founded about a year ago, Call said he applied to various investment groups, many of which turned out to be unfruitful. He acknowledged that early stage startups, especially where the technology may still have risks, can find it difficult to receive funding.

So far, Call said New Mexico Angels members have provided GridFlow with about $100,000 in funding, which was critical to getting some air under the startup’s wings. The organization has also introduced the company to various investors and, while no funding has come from it yet, Call said it can help with pitching in the future.

“It makes a big difference to be able to get those early opportunities to pitch other folks and let them begin the process of tracking your progress,” Call said. “When you come back a year later and you’ve made some progress and you’re showing traction, it’s easier for (investors) who aren’t going to be able to go touch it.”

Being a part of New Mexico Angels for the last five years, Tulchin said both the organization and its community are only growing stronger.

“We keep getting better able to help our startup entrepreneurs, both with the capital they need and, perhaps more importantly, with the business skills they need to grow the companies to the next stage,” Tulchin said.

Editor’s Note: This story has been updated to include that some funding for Terra Vera and YEEO comes from New Mexico Angels members via the New Mexico Vintage Fund.