Firespring Fund is a division of Draper Laboratory, where Dr. Draper is also a partner. Draper is one of the leading venture capitalists in the country, with over 25 years of experience helping entrepreneurs obtain equity or venture financing for start-up companies. In the last decade, Draper has consistently provided seed-stage funding to companies that are on the verge of growth and desire access to specialized capital and management advice. At the same time, Draper has made sure that these same companies remain highly competitive in their core markets, and have continued to invest aggressively in the companies that are most promising. As one of Draper’s founding portfolio companies, Fire sprung from its seed investment in a Sarasota-based company that specializes in water treatment systems.
When the company started in 2005, it had no sales staff and did not intend to break any new ground in the emerging markets of central Florida or in the national market, where many early-stage ventures originate. In its first year alone, it raised about $50 million from a number of well-known venture capitalists, many of whom are also active in the Sarasota real estate market, as well as from prominent Florida business people. Since then, the company has grown substantially, and today it offers services in its core markets in Florida, including central florida, as well as throughout the United States.
Today, about half of all its business incubators and investor relations personnel work in Florida, as well as in Silicon Valley, which is its principal customer base. Its current projects include the acquisition of two technology companies, Archaic Systems and Envirodesic, both of which offer internet marketing services. In addition, the company is involved in the ownership of several other technology companies. Overall, about sixty percent of the company’s revenue comes from venture capital sources.
In order for a company to become considered an accredited investor in the Sarasota real estate market, it must adhere to certain guidelines. First, it must have a minimum of one hundred employees and a minimum of one hundred and fifty thousand dollars of debt outstanding. In addition, it must be majority-owned by a minority of owners. Finally, it must submit audited financial statements and a certified public accountant review to the Securities and Exchange Commission.
The firm has been actively seeking venture capital and private real estate financing partners for many years. In 2004, the company began offering a venture capital-backed venture called the “firespring Fund”. The program was intended to complement the traditional investment portfolio of the company, and it was designed to take advantage of opportunities in the rapidly expanding field of digital media and e-commerce. As part of the venture capital financing, the funds were used to purchase and manage a number of web properties, as well as Internet related ventures, which focus on mobile apps, digital media, digital content, digital photography, social media, online gaming, e-commerce, affiliate marketing, website development, client management systems, and other digital media and e-commerce businesses. As part of the deal, Renaissance Technologies offered seed financing to complement the investment funds, which has helped the company to obtain more funds than required.
In total, the company received funds from a number of sources, including venture capitalists, individual investors, and the funds of the Sarasota real estate investment fund. As part of their partnership with the Firespring Fund, Renaissance Technologies also received shares of the company’s common stock. In this capacity, Renaissance Technologies is entitled to dividends under the management agreement. If the company’s shares continue to be offered under this partnership agreement, Renaissance Technologies will receive a capital gain upon the sale of its shares of common stock.