Evan Vitale

Accounting Professional

Evan Vitale – Venture Capital News

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By Evan Vitale

Let’s take a look at recent Venture Capital (VC) news!

According to GeekWire.com, there was good news and bad news for venture capital activity in the Pacific Northwest. Here, venture capital activity was down 59% in the fourth quarter. However, overall, VC activity was up for 2015.

Last year, a record $2.4 billion was invested in 374 Pacific Northwest startup firms – up from $2.3 billion in 2014 and $1.4 billion invested in 2013.

Not bad!

From the Wall Street Journal, Healthline Media Inc. has raised $95 million from Summit Partners to compete with WebMD.com in the market for consumer-health information. Healthline.com was launched 2006 and provides health information to users through content licensed from third parties. The company was relaunched in 2012 with original content.

Also from WJS, a wine app called “Vivino” has raised $25 million in a Series B round of venture funding. Vivino Inc. is a mobile app for wine reviews and shopping. It lets users scan the label on a bottle of wine using their smartphones and access user-generated ratings and reviews. The new round of funding was led by SCP Neptune International. Other investors included Balderton Capital and Melo7 Tech Partners.

From the Houston Business Journal, a new venture capital fund has launched in Houston, Texas. Digitech is a crowdfunding-meets-private-equity style of venture capital where unaccredited investors will invest $50 to $100 per month. Digitech is targeting both software and technology-based companies, as well as biotech and healthcare. You can read the full article here:

http://www.bizjournals.com/houston/blog/2016/01/exclusive-new-venture-capital-fund-launches-in.html

KidPass, Inc., according to the Wall Street Journal, has started to sell $49 monthly subscriptions that give families access to many children’s activities, including sports, music classes, indoor play spaces, museums, and more. The idea, says co-founder and chief executive Solomon Liou is to give parents a “starting point whenever they are looking for any kind of activity for their children.”

You can check out KidPass here: http://blogs.wsj.com/venturecapital/2016/01/11/seed-funded-kidpass-launches-childrens-activity-subscription-service/

Evan Vitale – Ignoring Gloom and Doom Predictions

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By Evan Vitale

At the conclusion of every year – and the start of a new year – the gloom, doom and boom stories start to appear with business predictions for the next 12 months.

As a business owner, investor, manager or even a staff employee, it can be difficult to sort out what’s good and what’s bad when it comes to reading news involving industry forecasts for the upcoming year.

Here’s the best approach one can take when “experts” make their good-news, bad-news predictions:

  • Ignore them.
  • If you must read prediction articles, use it for informational (and entertainment) purposes only.
  • Remember, you – and you alone – drive your business. If you read “it’s going to be a bad year for your industry” articles and then spend all day wringing your hands and rubbing a worry stone then, yes, it’s going to be a bad year for your business.
  • Prove forecasters are wrong. Clip or print the article and use it for motivation. Use it as a blog post. Tell everyone you’re going to prove that business is good, etc.
  • Be positive, especially in front of your employees, customers and clients. If you feel negative industry news is affecting your staff, have a meeting or staff lunch. Tell them your plan to keep things moving in the right direction, despite industry “predictions” from an online magazine writer who doesn’t know anything about your company and the customers/client you serve every day.

At the end of the year, no one will remember whether industry predictions were right or wrong. The gloom-and-doom article writer has moved on (perhaps to another company) and will be  writing a new article about the positives and negatives for other business industries for 2017.

One of my business friends always tells me “onward” whether his business is growing, when he celebrates earning new business or if he loses a customer.

Keep your head up and stay positive. Ignore the pundits.

Evan Vitale – VC Money Tight in 2016?

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By Evan Vitale

The venture crystal ball, according to the Silicon Valley Business Journal, reveals that investors are predicting fewer unicorns and tighter purse strings for the upcoming year.

TechFlash Editor Cromwell Schubarth says most of the investors he interviewed at the conclusion of 2015, says the booming trend of venture capital funding is slowing down. Perhaps, we’ve been on a good ride for such a long time, that it’s likely things are going to calm down a bit.

You can read the entire article here:

http://www.bizjournals.com/sanjose/blog/techflash/2015/12/vc-crystal-ball-investors-predict-fewer-unicorns.html

Meanwhile, the Wall Street Journal says the Federal Reserve’s quarter-point rate increase will have very little immediate impact on the startup fundraising environment. However, gradual tightening is expected over the next 12 months. Will this leave companies short of startup cash before they start to see a profit?

Check out what capital investors are saying about this potential cash crunch here:

http://blogs.wsj.com/digits/2015/12/17/vc-mailbag-startup-funding-crunch-is-likely-in-2016/

However, once you dig down far enough, you’ll always be able to find some positive news from a venture capitalist.

According to CNBC, New Enterprise Associations general manager Rick Yang says 2016 will be a big year for companies working in virtual reality, edtech and e-commerce.

VC money might be tight, he says, in the first part of 2016 as compared to 2015, but he doesn’t see early-stage companies slowing down. Facebook and Apple, he predicts will look to “acquire more startups to maintain growth and obtain new technologies,” Yang says.

“I don’t think that any of the big tech companies are scared of acquiring companies right now, they still have quite a bit of cash on the balance sheets. And as I kind of mentioned in one of the previous questions, I do think they’re looking to other services outside of their core products for growth in the next year,” he said.

You can read the full article here:

http://www.cnbc.com/2015/12/31/one-venture-capitalists-predictions-for-2016.html

Evan Vitale – Latest VC Headlines

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By Evan Vitale

Here’s some of the latest venture capital news being discussed and shared online:

According to the OC Register, Irvine, California is a quite the “mecca” in Orange County when it comes to winning venture capital funds. A recent report says Irving-based companies raised more money than any of the county’s other 33 cities combined.

The Register went on to say that during the first nine months of 2015, Irving-based companies raised nearly $278 million in venture capital. Newport Beach was next in line with $57 in venture capital funds raised. The report was released by Jones Lang LaSalle Research and PricewaterhouseCoopers MoneyTree.

You can read the full article here:

http://www.ocregister.com/articles/million-698761-capital-companies.html

Recently, Indiegogo unveiled a new service that could “prove to be controversial among its core users by giving an edge to large corporations engaged in crowdfunding.”

In a blog post by the Wall Street Journal, “Goliaths have long since infiltrated crowdfunding sites, trotting out new products and promotional campaigns on platforms like Kickstarter and Indiegogo. But Indiegogo’s new Enterprise Crowdfunding service aims to help increase their chances of success on the platform.”

The blog post is here:

http://blogs.wsj.com/venturecapital/2016/01/06/indiegogo-courts-corporate-crowdfunders-with-new-services/

Monsanto Growth Ventures, the venture capital arm of the Monsanto Company announced for the first time its growing investment portfolio; nearly a dozen independent companies that are active in key areas of agricultural productivity, digital agriculture and biologicals.

StreetInsider.com has the news here:

http://www.streetinsider.com/Corporate+News/Monsanto+%28MON%29+Venture+Capital+Arm+Launches+First+Investment+Portfolio/11197249.html

From Bloomberg Business, growing peer-to-peer lending and online money transfer services helped raise a record $3.6 billion in venture capital funding for the UK technology sector last year.

The largest single investment in the industry was attracted by London-based small-business lending platform Funding Circle, which raised $150 million in April. London continues to have an expanding financial technology sector, which had a record year in 2015.

The full article is here:

http://www.bloomberg.com/news/articles/2016-01-06/u-k-tech-startups-raise-record-venture-capital-in-2015

Evan Vitale – Non-Tech Firm Raises $13.5 Million

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By Evan Vitale

A Chattanooga, Tennessee startup has raised $13.5 million in venture capital – the largest one-time VC capital investment of any Chattanooga startup company.

And it has nothing to do with technology; medical; devices or apps.

“Bellhops” uses approximately 8,000 college students, who are employed as independent contractors, to help consumers move household goods and furniture in 88 cities across the United States. About 4,500 of those students are working activity as moves are ordered through a web-based, on-demand service.

The company is the brainchild of Auburn University grads Stephen Vlahos and Cameron Doody who started Bellhops in 2011.

Bellhops gained initial funding of $6 million in November 2014 from the Lamp Post Group in Chattanooga. Recently, Canaan Partners, a Westport, Conn.-based investment fund helped arrange the most recent round of venture funding to help the growing company add more staff and enter more markets. The recent funding including Lowercase Capital, Bullet Time Capital and Binary Capital.

Currently, Bellhops employs approximately 65 employees at its 12,000-square-foot rented headquarters in Warehouse Row in Chattanooga and provides a unique, lower-cost moving option.

While revenue numbers weren’t disclosed, Doody says Bellhops has been growing five-fold every year. The two original owners will maintain majority ownership and the company plans to stay and grow in Chattanooga.

Bellhops offers a variety of moving services and charges an hourly rate. The firm doesn’t own any trucks, but supplies the labor to help others move with their own or rented trucks.

Bellhops won the Chattanooga “Spirit of Innovation” award in 2014 from the Chattanooga Area Chamber of Commerce. You can visit its website at https://getbellhops.com/.

Evan Vitale – 2016 Business Predictions

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By Evan Vitale

Everyone, it seems, has a business prediction for 2016.

Here a few of my favorites.

From http://nerdwallet.com:

  • More online small-business loans.
  • More women-owned businesses.
  • More loan dollars guaranteed by the United States Small Business Administration.
  • Entrepreneurs will use more business credit cards to make purchases for their companies.

From http://forbes.com:

  • Expect gradually increasing interest rates and tougher credit for business.
  • Lower oil prices into mid-year followed by gradual increases.
  • This will be a big year in terms of mega-mergers.
  • It will be a challenging growth year for middle-market companies.
  • Politics as usual.

From http://businessnewsdaily.com (who has 50 small business trends and predictions for 2016):

  • Small business growth will continue.
  • Same-day delivery and cross-border selling will expand.
  • More businesses will come up for sale as Baby Boomers look to retire.
  • Small businesses can expect more scrutiny from customers
  • Despite increasing internet connections, human connections remain the most important.

Here are some other notable predictions for the new year:

  • Security experts are expecting there to be new cyberattacks and hacks. This will include attacks through apps. Source: http://www.inc.com.
  • For businesses who utilize Google Adwords and other Pay-Per-Click (also known as “PPC”), ad targeting will be awesome in 2016. Social media ads are quickly becoming a favorite for many businesses. Bing Ads are expected to make a strong comeback. Source: http://wordstream.com.
  • Store front businesses that did well in 2015 (small grocers, hair salons, coffee shops, restaurants, fitness centers, home improvement contracts, retail boutiques and other “strong fronts”), should continue to have a good year in 2016 with, perhaps, some modest growth. Source: http://pymnts.com.
  • The impact of climate change and new technologies (such as the ability to check pricing on smartphones) means 2016 could be a good year for the wine industry, although craft beer and craft cider continue to earn a lot of attention. Source: http://bloomberg.com.

Do you have a business or industry prediction for 2016?

Evan Vitale – 2016 Might Be Good For Small Business Lending

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By Evan Vitale

How are things looking in terms of small business lending in 2016?

Well, believe-it-or-not, jumps in the interest rates might also mean good news for businesses who want to seek out bank loans in the upcoming year.

You see, banks only make money when they lend money and with higher rates, banks might be more interested in ramping up their small business lending portfolio.

According to the Biz2Credit Small Business Lending Index, the percent of loans applications approved by big banks reach 22.8%, which is the highest since the recession. The recent interest rate hike makes lending to small businesses more attractive for larger banks. The Biz2Credit Small Business Lending Index believes the loan approval percentage next year could go above 25%. Remember, higher rates means more profit for lenders.

But what about other types of lending opportunities?

Institutional investors look good. During November 2015, institutional investors approved 62.4% of all loan requests.

However, alternative lenders, smaller banks and credit unions are granting loans at decreasing rates. In fact, small banks, which usually generate a large number of Small Business Association (SBA) loans, are now approving less than half of the loan applications received. In 2014, they approved more than 50% of loan applications received.

According to Forbes, community banks are struggling to compete, so many business borrowers continue to look to other sources for funding. In addition, big banks on institutional investors, which are making loans possible via an online marketplace lending platform, are able to make quicker decisions at more attractive rates and terms for business borrowers.

Some other interesting notes from Biz2Credit:

  • Almost half of all loan applications are made via mobile units.
  • Smaller banks and credit unions haven’t kept up with technological innovations and, thus, miss out on loan deals since their application process takes longer.
  • Many times, credit unions want a borrower to come to the branch office and become a member.

Evan Vitale – Finding A Tax Preparer (Part III)

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By Evan Vitale

In our final blog post on Finding A Tax Preparer, here are some questions you can use during your own searching process. The answers you receive will help you in finding the right fit for your business.

  • Ask your tax preparer if they have any experience in your industry? Tax laws are different and specific for different businesses, so your tax preparer should be familiar with the tax laws that impact you and your firm.
  • Who will be working on your returns? Sometimes, medium and larger firms have staff or associates repair the returns. If so, what is their level of expertise?
  • What is the firm’s tax return review process? Will your returned be reviewed for accuracy, but will it also be reviewed for missed opportunities in helping you to reduce your taxes?
  • Will your tax preparer look at your past returns? If so, what will they do (or recommend) in having something different done with your current returns? Most tax preparers can suggest a least one idea of something that could have been done (and can be done) to help reduce your taxes.
  • How much can your tax preparer save you in taxes? It will be difficult to give an accurate, on-the-spot answer, but they should have a general idea after spending some time discussing your business; your financials, and looking at past returns.
  • What are the deadlines that you need to meet in order to get the proper paperwork and information to your tax preparer? Can you, as the business owner, meet this deadline?
  • Are there any tax law changes that you should be made aware of? Your tax preparer should be on top of current changes and any upcoming changes that could impact your taxes.

Be selective! And feel 100% comfortable with the tax preparer that you choose for your business. Finding the right tax preparer can make a big difference!

Evan Vitale – Finding A Tax Preparer (Part II)

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By Evan Vitale

You should feel absolutely 100% comfortable with the tax preparer you hire for your business.

During the search and interview process, make sure your tax preparer:

  • Knows the tax law extremely well.
  • Knows how to be creative legally (no, your tax preparer isn’t going to cheat on tax returns for you).
  • Asks you many questions about your business situation, so they can better understand your financials and goals. Don’t be afraid to offer valuable information as this will only help your tax preparer in offering the best tax advice.
  • Has a review process in which at least one other person in their office also reviews the final tax returns to make sure everything is correct before the returns are signed.

Ask your potential tax preparer candidate how many times their clients have been audited by the Internal Revenue Service. What was the outcome of such audits? Were additional taxes assessed by the IRS or were there no charges? Does the tax preparer offer an audit defense plan?

In Part III, we’ll offer some other prepared questions you can use when interviewing a potential tax preparer for your company.

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Evan Vitale is a multifaceted finance and accounting professional who provides Audit, Accounting, Tax, Due Diligence and Advisory services to Venture Capital Funds, Hedge Funds, Private Equity Funds, Family Offices, Small Business Investment Companies (SBICs), Funds of Funds, Other Investment Groups and their management companies. 

Today’s market has made it extremely difficult to predict what the next day will bring.  For Funds and Other Investment Vehicles, the expectations remain to balance the different opportunities with a continued focus on value creation in existing portfolios.  The key to any successful organization is building and maintaining the trust of your investors. Evan has the expertise to help you shine in your investor’s eyes and stand apart from the competition.

Connect and network with Evan Vitale on LinkedIn.

Evan Vitale – Finding A Tax Preparer (Part I)

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By Evan Vitale

Don’t wait until April 14th in order to find a professional tax preparer. If you feel you need one – and you don’t have a CPA in your team of business advisers – you should start looking for a tax professional today.

Not all tax preparers are the same.

Some tax preparation businesses will hire temp help during the busy season, while others will advertise with a simple sign nailed to a light pole.

Choose wisely.

There’s a big difference in filing simple tax returns for an individual than it is for filing local, county, state and federal tax returns for a business.

Your tax preparer should be extremely knowledgeable in tax law and should be asking you a lot of questions about your business and tax situation in order to understand your situation and goals.

In addition, a professional tax preparer would sign their name and contact information on your return should the Internal Revenue Service have any questions at a later time. Will your tax preparer help you with questions from the IRS?

Ask questions and make sure you’re hiring the best tax preparer for your business!

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Funds have special needs when it comes to finding an accounting firm to help them with their accounting, auditing, tax and financial due diligence projects. Managing a fund is complicated enough without having to build the infrastructure to have accounting and tax services handled also.

Evan Vitale helps Funds stand apart from their competition by exceeding their investor’s expectations with high quality and timely financial and tax reporting. Evan has the expertise in the private equity industry to provide a full range of services focused on the needs of the private equity firms and their portfolio companies. As changes continue to impact the industry, Evan stays informed and updated, bringing you the most accurate guidance and strategy.

Evan is constantly striving to go the extra mile.  In areas like evaluating acquisition targets, Evan works with private equity and venture capital firms to assess the viability of an acquisition and, if determined to be the best course of action, implement a successful acquisition plan. Get in touch with Evan today for all of your Fund needs! You can also connect with Evan via his LinkedIn page or follow him on Twitter.