Tic… Toc… Tic… Toc…

RT Custer and Tyler Wolfe had lost count of the tics and the tocs a long time ago. Three years and about 25 iterations later, the partners had created a fully adjustable assembly that allowed them to transform antique pocket watches into a unique wrist watches, bristling with authenticity and character. This was the genesis of Vortic Watch Company, the only company that manufactures watches, 100% made in the U.S.A.

Vortic’s technology is ingenious.  By altering the actuator, the setting and winding system of the watch, Vortic has the ability to provide custom watch manufacturing and vintage watch restoration to those seeking a timeless style. Using this new technology, RT and Tyler conceived Vortic’s first line of rustic watches: the American Artisan Series.

As a sucker for branding, Vortic struck me while researching RVC Portfolio Companies during my first couple days as an RVC intern. I thought about the saturation in luxury watches with big players like the Swatch Group, Tudor, and Rolex. With this market dominated by Swiss manufacturers, these companies have established an international reputation for quality. The handcrafted designs are so immaculate that they can be seen on the wrists of professional athletes, cinematic idols, and world leaders alike.

So how can these guys, based in Colorado, compete with the foreign goliaths?

In an interview, I asked cofounder and CEO of Vortic, RT Custer, how the company plans to break into an industry already saturated with brands that are synonymous with luxury and success. Without missing a tic, RT explained, “The biggest thing that you see working for all watch companies right now is limited editions, which creates urgency for the customer and scarcity for the product,” which Vortic specializes in because every watch is different. The vintage look of each watch encompasses America’s rich history in manufacturing, when we built this country from the ground up. Each watch tells a different story because Vortic creates every one of their pieces as a “limited edition of one.”

It was this brand’s scarcity that attracted investors in the first place. The guys from Vortic originally were referred to Rockies Venture Club through an RVC member attending a 1 Million Cups pitch event. At the time, Vortic had what they called a “Version 1” of the product, and they were not quite ready for venture capital. Nonetheless, an introduction was made with RVC’s Director of Operations, Dave Harris. Later, RT attended an RVC “Mastermind” strategy group and the group unanimously recommended that RT put his venture capital funding ambitions on hold and pursue an SBA loan with RVC partner, Colorado Lending Source.  After 2½ years’ worth of tics and tocs funded by the SBA, Vortic was ready to get venture capital funding. They applied through RVC and ended up receiving necessary capital a few months later.

It is not out of the question that the luxury watch industry could be in danger with the rise of smart watches, but RT does not worry about that either. In fact, he believes that Apple may have just done them a huge favor by releasing the Series 3 model that costs up to $1,399. With these increasing prices for smart watches, Apple, in a way, is conditioning millennials to understand the cost of quality wrist wear. As these smartwatches become more and more like cell phones, they begin to compete against technology, rather than these luxury watches. RT actually sees a trend of smart watches becoming more and more like cell phones. In the near future, wearable cell phones could replace current cellular devices entirely, similar to 80 years ago, when wrist watches overtook pocket watches, but only time will tell.

If you’ve read ANYTHING about cryptocurrencies and ICOs (Initial Coin/Token Offerings), you’ve read opinions from people who believe that the value of these coins will go up 100 times and others who believe that they will all crash to zero because there is “nothing there”.  If you believe either of these groups, you’ll be in big trouble if you’re an entrepreneur or angel/venture capital investor in this space.  Some cryptocurrencies will indeed go to zero and others will likely rise by 100X, but out of thousands of deals, how would you know how to pick the right ones?

It’s not just cryptocurrencies that have a lot of uncertainty today.  We’re seeing unprecedented change in blockchain, artificial intelligence, Internet of Things, self-driving cars and more.  These trends are all going to become a big part of our future, but which companies are the ones we should invest in?

Experience can be a guide in helping decipher the trends in fast breaking industries. The cryptocurrency ICO market reminds me a lot of all the dot.com startups in the 1990’s who were going public without having much more than a URL like etoys.com, socks.com, pets.com, etc.

What happened during the .com boom?  Lots of companies got funded quickly and at valuations that didn’t make sense.  It kind of looks like the ICO boom now.  When companies get too much money too quickly, they tend to accelerate their failure rate because they haven’t figured out their product-market-fit or how to scale up quickly.  We’ll certainly see some of that in the current ICO boom, but, just like in the .com boom, we’ll also see some VERY BIG winners. Google and Amazon looked crazy in the 1990’s  but now they are today’s biggest companies.  We will see the same thing with blockchain, cryptocurrencies, AI, IoT, intelligent cars and more.

The people who predict wholesale failure or wholesale success are bound to be wrong.  The people who are diligent in digging into who the winners and losers will be with a futurist attitude will succeed.  Investors who think like the hockey player Wayne Gretzky who famously said “A good hockey player plays where the puck is. A great hockey player plays where the puck is going to be.” 

Great venture capital investors have to be like great hockey players and invest where the market is going to be.

Predicting the future is hard, but we’ve got some help for you.  The upcoming Angel Capital Summit, produced by the Rockies Venture Club will be focusing on Funding the Next Wave of Innovation.  We’ll be interviewing CEOs of companies that have gone through major trends in social networks, cyber security and more in order to learn how to identify and ride the trends.

The Angel Capital Summit will also feature 16+ companies that are riding the trends of their industries, pitching to angel and venture capital investors.  The event is open to the public and is free for RVC Keystone and Active Investor Members.  (If you’re not a member yet, click HERE for more information).

The Rockies Venture Club is the oldest angel investing group in the U.S. and is a non-profit organization focusing on furthering economic development by educating and connecting angel investors and great startups.


Better … Faster … Deal-Making
A Track Record of Success

Pursue your own successful investment strategy. Engage with thought leaders and experienced Angel investors. Don’t just take our word for it.  Explore these recent success stories made possible by the Angel Capital Summit (ACS) hosted by Rockies Venture Club (RVC). Read more

 Transparent consumer markets have never existed in our current healthcare system.  This means that consumers don’t have access to information that is needed for making informed decisions about healthcare options.  The result is that we randomly select care providers without any knowledge of the costs to the payers – thus increasing the costs for everyone.
Lack of transparency is about to go away and the implications for health care providers, payers and consumers will be huge.
Here is an article describing eight new startups that are working to increase transparency in health care.
If that is not enough for you, the Colorado Capital Conference (November 13, 2014 Denver, CO) will be addressing this issue.  Our keynote speaker, Tom Main (of Oliver Wyman) will address these issues and a panel of experts will dig deeper into the transparency issue to help investors make smart decisions about investing in early stage Digital Health companies in this area.  Visit www.coloradocapitalconference.org for more information and registration.

LOHAS (Lifestyles of Health and Sustainability) Food and Beverage is a unique market segment and it has its own set of rules and metrics.  I’ve been looking forward to RVC’s LOHAS Natural Food and Beverage Conference for over a year now because we’ve seen a number of natural food and beverage companies coming across our sights and it has been difficult to gauge whether they are a good opportunity or not. Read more

Last week at the Angel Capital Summit, the Rockies Venture Club hosted the first-ever University Startup Challenge. It was the first pitch competition in Colorado specifically for students from across the state, and we were proud to host it! Since they presented to real investors at an investor conference, we were looking for the ‘most fundable companies’ instead of just business plan competition winners. These entrepreneurs are all actively working to build their company, and some have real traction in the market. They were also on equal footing with the rest of the companies at ACS for investor funding. 5 of the top universities in Colorado nominated students for the event – University of Denver, CU-Boulder, CU-Denver, University of Northern Colorado and Colorado State University.  Read more

If I could have any job in the world, it would be to be a full time angel investor.  Angels get to meet super-smart people with cutting edge ideas, they work with other angels who have deep sector expertise and ask great questions, they are intellectually stimulated in evaluating and negotiating deals and they can make a lot of money. Read more

The crop of companies presenting to investors at this years’ Angel Capital Summit are truly outstanding.  Some people may believe that these awesome companies just fall into our lap, ready to pitch and raise capital, but nothing could be farther from the truth.  The selection process for the Angel Capital Summit is rigorous and the preparation companies go through is even tougher. Read more

10.10.10 is an innovative program that combines 10 wicked problems, 10 prospective CEOs, and 10 days together in Denver. The bigger the problems the bigger the opportunities, and they’re intent on finding the most massive problems out there and empowering CEOs to create solutions. The first program launches in August, 2014 and is the first of its kind. Read more