Stories of Technology, Innovation, & Entrepreneurship in the Southeast

“You are looking at an abyss and chewing on glass,” Andrew Hanna, Chief Product Officer at Safire Technology Group, told attendees at a Wednesday afternoon panel discussion titled “Raising Capital in Knoxville: A Look Behind the Curtain.” He was referring to the constant risk that entrepreneurs always face and how they are regularly bombarded with the biggest issues that others on their team cannot solve.

The session, hosted by PYA, the power behind teknovation.biz, was one of more than a dozen programs during the annual “Innov865 Week” celebration of entrepreneurship in the region.

Moderated by Brandon Bruce, a serial entrepreneur and Managing Partner of the new Market Square Ventures fund, the panel also featured:

• John Derrick, AuthentricsAI, a finalist for the 2024 PYA Ballard Innovation Award;
• Britton Garrett, iO Urology, winner of the 2023 PYA Ballard Innovation Award; and
• Corey Tyree, Trillium Renewable Chemicals, a finalist for the 2023 PYA Ballard Innovation Award.

PYA is committed to helping the Knoxville region grow, as Marty Brown, PYA’s President and Chief Executive Officer, told attendees at the afternoon session held at the Institute for Advanced Materials and Manufacturing on the University of Tennessee Research Park at Cherokee Farm. In addition to the nearly 13-year-old teknovation.biz that publishes six days a week, PYA also regularly works with local start-ups, including those in the “Innovation Crossroads” and “Spark Cleantech Accelerator” programs.

The nearly 90-minute session was lively with loads of insights for those who came to hear the experiences of the four panelists and Bruce who had all raised considerable outside capital.

In describing the process that Safire engaged in, Hanna said it was “pretty defined.” The company’s Chief Executive Officer focused almost exclusively on pitching, starting from a list of 500 firms. In the end, there were at least 111 pitches made to various firms.

Then, as several other panelists noted, Safire’s lead investor – Canaan Partners, headquartered in Stamford, CT – sent an email to info@safire.com. It was unexpected, Hanna said, and that firm subsequently led the $8 million round announced on September 19 (see teknovation.biz article here).

He quipped, “Someone asked if we should respond?” Good thing the answer was YES!

Tyree described a similar situation, saying that Trillium’s Series A was led by Hyosung Advanced Materials Corporation, based in Korea. Along with previous investor Capricorn Partners, located in Belgium, and Hamburg, Germany-based HELM AG, the round raised a total of $10.6 million.

“At the end of the day, it boils down to relationships,” Garrett said, adding somewhat tongue-in-cheek, “If you are desperate for a date, no one wants to date you.” Translation: Don’t ever show desperation.

What are the challenges of raising from a Knoxville base?

Tyree noted his company has now raised $20 million, none if it in Knoxville. Yet, he added, “The connection to support in the community was so important. (Being based in Knoxville) is not a liability.”

Derrick explained that he has seen a real difference in terms of the attitudes of venture capital firms since COVID. Today, more and more board meetings, pitches and even due diligence are being done virtually.

“A big part of our story is access to the lab (Oak Ridge National Laboratory),” Hanna said, and Garrett added, “Our story is enriched by being here.”

Several key themes emerged as the panelists shared their stories.

• It is important to be authentic. “You will need to be your own authentically self,” Garrett said.
• The focus must not be just on the team but on traction.
• A key success factor could be to find others who embrace what you are trying to do and want to share your story.
• There was a reminder that venture firms invest in people and those that are passionate.
• Persistence is also a key strength that people need to have.
• There should be a continuous focus on things you can control. “We can only control what we can control (which is) effort and attitude,” Hanna said.

---