Angel Fair brings 'Shark Tank' vibe to Philly start-ups

Drew Devitt, founder and chief technology officer for New Way Air Bearings, makes his two-minute elevator pitch at a “speed-dating” event at the 2010 Angel Venture Fair, where entrepreneurs wooed angel investors.

College basketball enthusiasts have March Madness. Philadelphia's start-up community has the Angel Venture Fair.

For 2017, the annual daylong pitch-athon, now in its 19th year, has attracted an all-time high of 217 applications from companies in 16 states and 15 countries. Unlike other angel events, the Philadelphia fair is not limited to technology start-ups.

"I think the growth in applicants is a combination of people’s obsession with the show Shark Tank and the excitement of rock-star companies like Tesla, Uber, Snapchat, and Airbnb,” said Marc Kramer, a serial entrepreneur and executive director of Private Investors Forum, which runs Angel Venture Fair, believed to be the oldest angel conference in the Mid-Atlantic region. 

Angel Venture Fair gives early-stage companies the chance to pitch to a ballroom full of investors at the Union League, in hopes of scoring a private meeting and that elusive make-or-break resource: funding. Tuesday was the application deadline for  the May 5 event.

This is Kramer's seventh year overseeing the venture fair.

"The first four years, getting to a hundred applicants was really tough," said Kramer, who is also president of Kramer Communications in Philadelphia.

Since taking over Angel Venture Fair, Kramer has marketed it year-round "to angels all over the world."  He also increased the number of companies allowed to participate each year, from 24 to 34. The additional 10 slots are for start-ups run by college students, recognition of a growing emphasis on entrepreneurial programs at schools, as well as Kramer's belief that by helping student entrepreneurs "get better visibility with investors, we'd have a better chance of keeping them here creating jobs."

Student applicants for this year's fair outnumbered nonstudents, 125 to 92. They come from 21 schools in North America — including locals Drexel, Philadelphia University, Rutgers,  Temple, Villanova, the University of Delaware,  and the University of Pennsylvania — and three abroad, in England and Egypt.

About 60 angel investors will review applications and pare them to the 34 companies that will be given the chance to present to the investors attending Angel Venture Fair in May and to have promotional booths.

The growth in applicants over the last five years "says that everybody is out there starting up their own company," said Katherine O'Neill, executive director of Jumpstart N.J. Angel Network, a primarily regional investor, citing the "significantly" lower costs to do so. Less expensive hardware, as well as lines of open-source code that can be borrowed rather than written from scratch, are contributing factors, experts have said.

Ellen Weber, a longtime Angel Venture Fair participant who is executive director of Robin Hood Ventures and Temple University's Innovation and Entrepreneurship Institute, said presenting companies now "have stretched dollars further before raising outside funding, have taken advantage of new sources of funding like crowdfunding, and are more apt to have proof of concept than in the past."

Another positive trend, Weber said, is "more women investors in the room than when I first started attending."

Whether anyone actually scores funding, "it's an invaluable experience to learn what an investor is looking for," said Bernie Rudnick, the Angel Venture Fair's chief judge and managing partner of Stellar Investment Partners, which funds primarily life-sciences companies. "A lot of these young entrepreneurs are hearing these questions for the first time."

Rudnick said he has invested about $2.6 million in five start-ups he has met at Angel Venture Fairs over the years.

Organizers have not tracked total funding secured through the fair by the roughly 500 companies that have participated since its inception, Kramer said. Typically, 93 percent of participants each year get follow-up meetings with investors they meet at the event, he said.

Angel Venture Fair typically draws 400 attendees each year, most of them angel investors from Pennsylvania, New Jersey, New York, Virginia, and Maryland.

Given the robust turnout and the space limitations of the Union League, as well as the time needed for presentations — 10 minutes, plus question-and-answer follow-up for non-university start-ups (which pay $800 to participate) and one minute for student-owned businesses (which are not charged a fee) — it is unlikely that the number of approved entrants will grow, Kramer said.

Ed Camarota hopes his makes the cut to present this year. His home health-care technology company — Xverity Inc., based in a Ben Franklin Technology Partners incubator in Bethlehem — has vastly expanded its offerings since its predecessor, Care Technology Solutions, presented at Angel Venture Fair last year. In addition to health-care coordination through electronic tablets,  Xverity's platform now offers a way to integrate social needs, too, including transportation, food, and handyman services.

"Last year, we really laid the groundwork for connections," said Camarota, chief operating officer of Xverity, which is trying to raise $2.5 million. "We're hoping this year we reap the benefit of that."