Austin-based AngelSpan, which helps startups communicate with their investors, has recruited veteran entrepreneur Bryan Menell to lead it through a new wave of growth.
Menell will serve as chief operating officer at AngelSpan, which provides investor relations services for companies that have raised angel investments or venture capital funding.
"I identify with the problem they're trying to solve," Menell said. "I've made angel investments in several companies here in Austin, and good investor communications isn't a habit ingrained in most entrepreneurs."
A lack of communication can burn bridges, he said. "The biggest sin you can make is taking a check from somebody and not communicating, and then a year later reaching out to get another check. I've felt that pain several times."
Menell has been involved in Austin's startup community for nearly two decades, including founding several software companies. In 1997, he launched Austin software services firm Perficient, which is publicly traded. He went on to start other companies including Fusion Learning Systems, which merged with Enspire Learning, and Mahana, which was acquired last year by Crunchtime.
He is also a co-founder and mentor at Austin tech incubator Capital Factory and is an investor and adviser to a number of early-stage tech companies.
AngelSpan was founded two years ago by Joe Milam, who spent years as a money manager in Silicon Valley. Milam said he got the idea after clients become frustrated after investing in a startup and never receiving a progress report.
"They want to know what's happening, and if they're not kept informed, it's unlikely they will give you more money in the future," Milam said.
The solution, he decided, was a service that would collect information including financials, product development updates and other company milestones. AngelSpan aggregates the information, writes and edits the content and provides monthly and quarterly reports to investors.
Companies pay a subscription fee for the service. Milam said the company, which has raised a small amount of seed money, has 17 clients and is preparing to close on an additional round of seed funding.
Joel Trammell, CEO of Austin software startup Khorus, first began using AngelSpan to communicate with the company's investors. He liked it so much, he said, that he became an AngelSpan investor.
"I've made 20 investments, and the number of companies that communicate regularly with me over the years is probably three or four," Trammell said. "In general, the challenge is they're just so busy. They want to be careful and make sure they're communicating the right thing. With AngelSpan you have a format and you have other people checking to make sure you're not making some stupid grammatical error or putting in a number that doesn't make sense."
Menell will lead the company's strategic planning and development of its technology platforms and marketing efforts.
"Bryan is a quiet rock star here in Austin, and for him to choose us over other opportunities is a huge win for us," Milam said. "He has the experience of execution, and for us, it's about execution."