Making `Noise' for Startups

Paul Solitario, investment banker and champion of Charlotte's entrepreneurial class, was sitting in his 24th-floor office at the Bank of America Plaza Building earlier this week reminiscing about the much hungrier days of local startups.

"It was lousy," said Solitario, managing partner of Cerium Capital, LLC, a private equity firm which focuses on U.S.-based information technology and business service companies with sales of between $5 million and $100 million. "There was just no real tradition of investing in startups."

Of course, it's still no cakewalk on Main Street. To that end, Solatario these days is plugging Innovare Capital, a new startup of his own which, he says, will help give area startups better shot at survival.

Launched last month, Innovare Capital offers an equity-like investment dubbed "revenue based purchase order financing." Simply put: the fund gives small businesses capital in exchange for a percentage of gross revenue over a defined period of time.

For owners, the upside is they get can access to capital without giving up ownership in their company. The funding is intended to assist companies that have secured a purchase order, yet need the funding to fulfill the order, said Solitario, who shares ownership with his partner at Cerium and Stephen Bollier, CEO of Innovare Capital.

The launch is a natural for Solitario, as it extends his passion for building out Charlotte's small business landscape. A former investment banker at First Union bank and later First Citizens Bank, Solitario began crusading for local entrepreneurs shortly after his own startup (he was able to raise $600,000 of a 1.2 million investment target) pharmaceutical marketing firm, failed in 2002 in the post-9/11 downturn.

"Great idea. Atrocious timing," he deadpans.
He adds: "The good thing is that I know what it feels like to be on the other side making a presentation investors."

Since then, the 50-year-old Solitario has been ubiquitious on the startup scene, whether it was launching the popular WED3, a local "matchmaker" for young companies and interested investors, to serving as president of the nascent Charlotte Regional Technology Executives Council.

As Terry Cox, president of the Business Innovation and Growth (BIG) puts it: "Paul has been one of the people in Charlotte who will take ownership and start new things; he'll say, let's put a stake in the ground and let's do it. And frankly, I haven't always been so sure some of those ideas would work."

Solitario says: "All of this is about creating some noise for the entrepreneurs in this community. The entrepreneur almost never knows how it is they'll become successful. What's important, though, is that they believe they can."