"Venture Services" Firm RevRoad Lands $15 Million in New Funding
With more than $25 million in total outside monies now invested in the Provo-based firm, RevRoad looks to accelerate its growth, both in Utah and Florida, home of its second base of operations.
Although many might consider RevRoad a "venture accelerator," CEO and Co-Founder, Derrin Hill assured me yesterday that that is not the case; instead, he says that his firm is a "Venture Services" company, which is why yesterday's funding announcement from the Provo, Utah-based enterprise was so intriguing.
Headquartered on Provo, Utah's Freedom Boulevard in the former Daily Herald building, RevRoad was formed in 2017 with the idea of creating an organization designed to help inventors get their new startups off the ground with virtually any service they might need to launch and become successful.
Unlike typical venture accelerator programs that last an average of 90 days, RevRoad provides entrepreneurs with an"equity-for-services" option that can last for up to 24 months. As such, it gives portfolio companies access to a suite of a dozen different business offerings which are available to firms à la carte in exchange for equity, not cash, including such services as
- Engineering services;
- Financial services;
- Fundraising assistance;
- Human resources;
- Legal services;
- Marketing (from ideation to implementation);
- Mentoring support;
- Office space;
- Sales services;
- Software development (application and web);
- Strategy design and implementation; and
- Systems support.
RevRoad solicits applications on a quarterly basis to recruit startups to join its newest cohort, with one to three firms accepted into the RevRoad ecosystem each quarter. And so far, 73 startups having signed-up for the firm's Venture Services business model during its six-year history.
Driving Growth from the Rockies to the Southeast
Based upon my conversation with Hill, RevRoad has now raised over $25 million from external investors to help it
- Expand its internal services capabilities, and
- Drive growth in the newly opened RevRoad office in Orlando, Florida, while
- Continuing to support its ongoing efforts here in Utah.
"There is an incredible ecosystem for entrepreneurs throughout the entire state (of Florida)," Hill said.
He went on to identify four separate industry sectors in greater Orlando that he feels are particularly attractive to his firm:
- Aerospace & Aeronautics;
- High-tech Manufacturing;
- Media & Entertainment; and
- Software.
In addition, Hill confirmed that RevRoad sees the 66,000-student-strong University of Central Florida as another major positive for the company as it looks to grow its presence in the greater Orlando area and help local entrepreneurs accelerate their success.
In fact, Hill said RevRoad has already participated in or led several on-campus meetings since launching its Orlando base of operations in April.
Why I Feel RevRoad's "Venture Services" Model is Intriguing
Obviously, one of the main reasons why most startups fail is lack of capital, which makes financial resources so precious in the early stages of a startup.
This is even more true in today's economic environment where every venture capitalist I've spoken with over the past 8 months has told me that company valuations have "normalized." {NOTE: That's VC-speak for "dropped significantly," and that's assuming a startup can even raise monies today.}
This being the case, I find any opportunity to preserve (or produce) cash to be super important, especially in the entrepreneurial world.
So exchanging equity for often make-it-or-break-it services, à la a RevRoad model (like legal counsel or software development or HR support), is really intriguing, at least in my mind.
Obviously, that assumes that the services provided by RevRoad are worthwhile; but given the Occam's Razor argument, I'm pretty confident that this is the case.
So how successful will RevRoad be with this new funding in place? To be clear, the Hill-led organization already IS successful.
The real question is
Will RevRoad find success in Florida?
Clearly that is left to be seen.
In my opinion, I believe the answer is "Yes."
Regardless, I suspect that by the end of UCF's Spring Term next April we'll have a pretty good idea.
P.S. If you have a news tip or story idea for Utah Money Watch, please email me at David.Politis@UtahMoneyWatch.com. Thx. 🙏 🙏 🙏DLP
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