It's not every day that a startup decides to relocate from sunny Los Angeles to Green Bay, Wisconsin. But that's the story behind ChemDirect, an online chemical supply marketplace that moved from sunny LA to the frozen tundra after receiving an investment from TitletownTech, a $25 million VC fund from the Green Bay Packers and Microsoft.
The timing of ChemDirect's move proved precarious as the startup set up shop in Green Bay in February 2020, just weeks before the Covid-19 pandemic would take hold across the U.S.
"They not only relocated here, but then the world shut down and they were stuck here," said Craig Dickman, TitletownTech managing director. "The good news is they stayed here."
The startup's relocation shows, in part, the impact of the Packers brand — but also the potential impact for local startup ecosystems when sports teams and their stars turn to venture capital investing.
TitletownTech, launched three years ago, is in many ways a dream partnership for a small-market city to boost its startup community credentials. A beloved local sports franchise and one of the largest tech firms in the world teamed up to create an innovation lab, venture studio and $25 million fund, all based in the Titletown complex at Lambeau Field. Part of the impetus for the fund was to help lift up Wisconsin startups, Dickman said.
"There was without question a focus on the Wisconsin marketplace," he said. "We believed having the Packers brand, along with Microsoft, would enable us to very quick spin up a network that could support a startup ecosystem."
TitletownTech invested in 23 startups as part of its first fund, with 12 of those businesses headquartered in Wisconsin. Two other startups, Denver's Quantum Radius and New York's Oculogica, joined ChemDirect in moving their headquarters to Wisconsin after landing a check from TitletownTech.
TitletownTech is now planning its second fund, which aims to raise $80 million.
Sports teams and athletes aren't new to startup investing. Top players like Kevin Durant, through his VC firm Thirty Five Ventures, and Steph Curry, who leads Penny Jar Capital, actively invest in startups. Tennis superstar Serena Williams has more than $100 million in the bank for her VC fund Serena Ventures. The Los Angeles Dodgers launched the LA Dodgers Accelerator, the world's first sports tech accelerator, in 2015, and recently partnered with Billie Jean King to support women in sports. And Kobe Bryant, before his untimely death, built a VC firm with Web.com founder Jeff Stibel with over $2 billion in assets.
Venture capital has, in many ways, replaced the used car dealership and restaurant ownership stake athletes once turned to when looking to invest their millions. And it has provided a major boost to startups not only through capital, but with the increased visibility and connections that come with partnering with sports stars.
The connection between the sports world and startups is perhaps even more impactful when investments are made at the local level, where checks are written by hometown heroes into hometown businesses. Michael Redd, the former Milwaukee Bucks shooting guard who attended Ohio State University, launched Columbus-based 22 Ventures, a firm that aims to upend the VC model by investing in and supporting entrepreneurs who are aiming to build stable companies.
"I’ve always loved seeing people’s dreams come true," Redd told the Columbus Business First last year. "Most of the premise of this is to help platform people, and give people an opportunity and hopefully a superior outcome."
The examples of sports figures backing local upstarts are numerous. Charles Barkley, an Alabama native who played basketball at Auburn, was an initial investor in the Alabama Futures Fund, a $25 million seed-stage VC fund focused on Alabama startups. Tom Ricketts, chairman of the Chicago Cubs, invested in Chicago startup Bartesian, maker of a countertop cocktail machine that's now used at Wrigley Field. Ryan Heckman, a graduate of University of Colorado who became the youngest-ever U.S. champion in ski jumping in 1991, co-founded Denver-based Rallyday Partners, a $350 million fund that invests in health care and tech.
Denver Broncos quarterback Russell Wilson, who invested in Seattle startups during his time with the Seahawks, is expected to bring his VC chops to Denver alongside his wife Ciara.
"Yeah, obviously Ciara and I are always looking to be in the VC world and invest," Wilson told the Denver Business Journal this summer. "So, super important to us."
In Green Bay, startups have not only benefitted by TittletownTech's cash, but also a chance to partner with the Packers in various ways. Fork Farms, a Green Bay-based indoor farming startup, has sold its greens at 1919 Kitchen & Tap in Lambeau Field at on the suite level on game days.
"When we invested in (Fork Farms) they had three people. Now they have almost 25 employees," said Cordero Barkley, a partner at TitletownTech. "The opportunity to get exposure, to test out and iterate in a real environment, and a high-stress environment — it gives them an advantage in markets that a lot of other funds just can’t create."
ChemDirect, during the height of the pandemic, provided the Packers with protective equipment and disinfecting chemicals.
Dickman said being tied to the Packers provides TitletownTech "instant access to a first conversation." It's an advantage and foot in the door that not every startup investor has access to.
"It certainly holds unique weight," he said.
