South Valley Angels is quietly investing in Bay Area companies
Asthma device and hydroponic greenhouse just some of the companies invested in
Published in the Oct. 1-14, 2014 issue of Morgan Hill Life
By Robert Airoldi
For the past three years, Morgan Hill has had its own venture capital group that has invested in a medical device for asthma sufferers, a lighting company whose product can light up an entire neighborhood and costs 10 cents on the dollar for competing firms and a hydroponics company that helps develop the process to grow vegetables on Mars.
South Valley Angels is a membership organization of nine accredited investors who provide an environment for investors to comfortably assess and look at start-up companies and decide whether the companies are worthy of an investment.
“They must bring something new and innovative and bring value to society,” said Gary Jinks, founder, managing director and chairman of the board.
South Valley Angels is part of the Angels Investors group that includes more than 100 other groups across the country. Each group can tailor their investments, and the South Valley Angels has focused mainly on manufacturing, Jinks said.
“We invested in a medical device, which was our first investment,” he said. It was a device made by Spirometrics that an asthma patient could blow into to determine when their next attack was coming. “They took what was in the hospital and ‘Silicon Valleyized’ it to where it’s small and cost $400 instead of thousands. It’s an amazing device and they just got a second round of investment of $7 million.”
Also, a very novel hydroponics greenhouse company called Got Produce was recently funded.
“They use 2 percent of water of a field crop and produce a head of lettuce in 25 days instead of 120 days it would take in a field in Salinas. It was funded in January with nothing on the books and by May they’d earned $2 million and built two projects in Africa and now they are on a seven-country rollout and they are a rock star in Africa,” Jinks said. “The woman involved figured out how to grow vegetables on Mars.”
The entire process can run on a cell phone, he said. It uses drones to fly over the produce measuring all aspects of the greenhouse and sends alerts and messages to a cell phone when anything is amiss.
Before founding South Valley Angels, Jinks helped launch two start-ups, before he was recruited by Rockwell Collins to lead its entry into a new market. In 2005, he started GLJ Group which has generated more than $300 million in new business for clients. He also provides workshops for entrepreneurs and start-ups to get them out of the gate effectively and efficiently.
Jinks said locating South Valley Angels in Morgan Hill and having most of his partners located in South Valley has its advantages.
In Silicon Valley a majority of the venture capital groups are located in Palo Alto, San Mateo and the San Francisco area.
Jinks said he set up in Morgan Hill because he was tired of commuting north and that Morgan Hill was fertile grounds for South Valley Angels.
“One of the areas lacking funding is manufacturing and Morgan Hill has a strong manufacturing infrastructure,” Jinks said. “So we set up shop here, focused mainly on manufacturing firms and in the past three years, virtually all the companies we’ve invested in have in fact been manufacturing companies.”
Another advantage of being located in Morgan Hill, Jinks said, is South Valley Angels stands out among the crowd. Being in Morgan Hill allows them to differentiate themselves from other investment firms doing business in the Silicon Valley.
“When I go to meeting full of investors and say I from Morgan Hill that resonates because I’m the only one.”
Now, Jinks is hoping South Valley Angels can take the next step.
“We came here to focus on manufacturing and people looking for a change,” he said. “If we can do that here and get these folks coming out of high school to create businesses, we have an opportunity for Morgan Hill to step into what the rest of the valley is doing.”
Jinks said the group is always looking for new ideas. The team first looks at a one-page executive summary that covers all the details of the idea. If they find it interesting, the applicant will be invited to one of their monthly meetings for a 10-minute pitch with 20 minutes of questions.
The group then considers all ideas and if there’s one investor interested in an idea, they do what’s called a “deep dive” in which the prospective company brings in their entire team, SVA looks at the business financials and – if selected — a project manager, usually the one most interested who will put up the most money.
“Then we hammer out the details and, if agreed upon, a check is written,” Jinks said.
Anyone interested should send an executive summary to email@example.com