Troy Tolle started a company three years ago, but it isn't expanding as fast as he had hoped.
Since he and a partner launched Digital Chalk, which provides software and payment services for online-education businesses, Mr. Tolle and his partner have attracted $3 million in angel investment and have gone from three to 15 employees.
In the past 10 months, he says, revenue has more than quadrupled.
But he says that the company could be twice the size, with twice as much investment, if there was as much financing available now as there was when the company started.
"If we had more money we could reach more customers," says Mr. Tolle, whose company is based in the growing technology community of Asheville, N.C. "We could triple our marketing budget and not exceed all the leads we could get."
Recent research suggests that companies like Mr. Tolle's—which are known as gazelles—can have a big impact on jobs.
While fast-growing firms that are three to five years old account for less than 1% of all companies, they generate about 10% of the net new jobs that are produced in any given year, according to recent research that was conducted by Dane Stangler, who is an economist at the Kauffman Foundation, which focuses on entrepreneurship.
The 35-year-old Mr. Tolle says he could probably raise more money, but the terms demanded by angel investors and venture capitalists would require him to give up too big an ownership stake in the company.
"They want so much for so little," he says. "I'm not seeing them come back forward and take on the risks they did in the past."
Above article as it appeared in the Wall Street Journal on November 18, 2010.
Whitehouse, Mark, 18 November 2010, “Shortage of Capital Costs Firm.”
http://online.wsj.com/article/SB10001424052748704104104575622931285425068.html
Accessed 22 November 2010
Digital Chalk can be contacted at 877.321.2451 and is located at One Town Square Blvd., Suite 204 in Biltmore Park Town Square.
