What Credit Crunch? | Framingham firm scores $2M in venture funds
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Co-founders of Framingham-based MyPunchbowl.com Matt Douglas (left) and Sean Conta (right) raised $2.1 million in venture funding.
A screen shot of the company's online party planning tool.
An online party planning web company has just raised $2.1 million in funding, despite a near drying of the venture capital well locally and nationwide.
Punchbowl Software Inc. of Framingham raised the funds from lead investor Contour Venture Partners of New York along with current investors Intel Capital, the global investment arm of Intel Corp. and eCoast Angels, based in Portsmouth, N.H.
Lucky Break
“It’s just a brutal market out there,” said Matt Douglas, co-founder of MyPunchbowl.com and the company that owns it, about raising venture capital money. “Over the last six months with all the problems with some of these banks, some VCs have their money tied up in Wall Street.”
Venture capital investment has remained flat in the second quarter of this year, with $7.4 billion in 990 deals, compared to the first quarter of $7.5 billion in 977 deals, according to PriceWaterhouseCoopers, which monitors venture capital funding on a quarterly basis.
But with a well-thought out business model that indentifies key revenue drivers and some proof that your concept can work, the success rate in raising investment money rises dramatically.
The popularity of MyPunchbowl.com, an online event planner that leads the user step-by-step allowed the company to show potential investors that they had a captive audience. The site lets users send electronic invitations, and save-the-date notices, choose supplies, communicate with guests including picking a date and a place to display event photos and videos afterward.
“Tens of thousands of people use it every day,” Douglas said.
Several factors interested Countour Ventures in funding Punchbowl Software, according to Bob Greene, partner in the venture capital firm.
“It has the best feature set in the market and it appeals to a wide spectrum of audiences, they have a great management team that’s smart and we love the way it spreads virally by word-of-mouth,” Green said. “Spreading virally is a big buzz word in our business.”
After four months of talking to the company and its customers, and using it twice to plan his own parties, Greene said it decided to fund PunchBowl.
In early 2005, Douglas wanted a business where he could use his web application development skills. After planning a joint party for relatives, he decided event-planning was the perfect business.
After leaving his job as a software developer for Framingham-based Bose Corp. at the end of 2005, he worked full-time at his new concept; he unveiled the site in January 2007. It received its first venture capital in October 2007 with under $1 million from Intel Capital and eCoast Angels.
The new money means the company can hire more web developers. “The next major phase is to help users find and buy the things they need,” he said.
WBJ Web Partners
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