LAMP POST VENTURES
Wamp StrategyThe first company created at Lamp Post is a public relations and creative strategy firm led by Weston Wamp. Wamp Strategy handles marketing and PR for Lamp Post and other clients.ProVision SportsProVision manufactures and markets consumer sporting goods products. The company holds several exclusive licenses for ACC and SEC licensed products.RetickrRetickr is an application that solves the problem of too much noise, too little news by personalizing content through a stock ticker interface. The Mac application launches Wednesday.Nooga.comNooga.com is an online news organization targeting the Chattanooga market.Fancy RhinoFancy Rhino is in the process of forming a creative studio for promotional videos. It creates animation, motion graphics, ads, documentary film and music videos.Cumberland Signal LabsThe company responsible for Flight Hub, a new aviation technology that simplifies wiring in airplanes.
The second floor of what once was Chattanooga's first department store would be unrecognizable to the late David Loveman, who began building the ornate Market Street landmark in 1885.
The morning commute in those days required equestrian skills, and Alexander Graham Bell had applied for a telephone patent only a decade prior.
Now 126 years later, fresh college graduates work late into the night on Loveman's second floor, poring over a mismatched array of computer monitors as they create what could be the next Twitter, the next Amazon or something completely new.
The remains of the department store's ornate furnishings are steadily giving way to sharp colors, glass-encased offices and belt-high cubicles.
That visual evolution is part of an attempt to restart Chattanooga's entrepreneurial spirit, say the founders of the newly minted Lamp Post Group, who are themselves successful Chattanooga entrepreneurs.
The business plan is an unusual one: Founders give advice, space, capital and office resources to entrepreneurs with ideas that are "scalable," or have the ability to grow explosively and profitably.
In the past eight months, Lamp Post has launched a half dozen companies, and organizers are looking for more new deals every day.
Waiting for the big one
If just one of the ventures in their "incubator" hits big, they stand to make millions off the investment.
"My wife doesn't know what I do anymore," said Ted Alling, co-founder of logistics startup Access America as well as a principal at Lamp Post. "First I did trucking, then insurance, now this."
After succeeding in the transportation industry, Alling and his partners realized that they enjoyed launching companies more than running them, and that they wanted to try out their ideas in Chattanooga.
They've grown Access America, their first venture, at a "feverish" pace into a $175 million revenue stream - in less than a decade. Others now oversee day-to-day operations at Access America while Alling and his partners spend most of their time at Lamp Post's various projects.
"We're really good at the base building blocks of starting businesses," Alling said.
Alling's associates in the venture include Jack Studer, Weston Wamp and Allan Davis. They bring experience in Silicon Valley, politics and operations, respectively, in a unique setup that situates them in the literal middle of the Lamp Post universe.
Instead of plush corner offices with soundproof insulation, they work in the center of the group's office, with 360-degree views of the private incubator's hustle and bustle.
Being in the middle also gives direct access to the members of their various ventures, like Jared Houghton, co-founder of software mini-firm Retickr.
Retickr is a tool under development that functions like a stock ticker with a twist. It displays live updates from a user's social media networks, and can be installed on a computer or television.
"We can intelligently match tweets with a user's interest," Houghton said, as programmer Josh Marlow walked into the room.
"How are you sleeping these days?" he asked Marlow.
"Better than last week," the tired software engineer responded.
He's been working long days and sometimes long nights. The team is in crunch mode, trying to get a stable version of the software polished up for the Mac release on Aug. 10.
It takes a combination of programmers, interface artists and designers to create an elegant tool such as Retickr, to say nothing of the financial, managerial and hardware side of the company.
That's where Lamp Post comes into play.
"Lamp Post handles all the back-office stuff, and as investors it's nice not to have to pay for a [chief financial officer] at each company," Alling said.
In its own way, Lamp Post functions as a sort of mothership that supports the smaller groups in its orbit.
The company shares a number of designers, Web developers and programmers who can be shuffled around from venture to venture as needed, Studer said.
"At a lot of startups, when you don't have a need for a person anymore, you fire them," he said. "Here, we have these resources we can deploy where they're needed."
They won't say how much they've invested in the venture, or how much they plan to invest. But they're clear about one thing - they're just getting started.
As Studer spoke, Davis came out of his center office and sat down with a separate group of entrepreneurs. Focused on his project, he barely glanced up from his laptop.
"When we work on a project, we go out and sit with the team," Studer explained. "It helps us to get stuff done faster."
Rock the cradle
Despite all the tender loving care showered on Lamp Post's venture companies, they are expected to be self-sufficient within a year and living on their own.
"We give them the tools they need to get up and running, and then we get out of the way," Studer said. "A lot of investors don't."
The movie "The Social Network" vividly illustrates one of Studer's ideas about what's wrong with venture investing today: In order to grow and become successful, entrepreneurs must give up larger and larger chunks of their company to others. By the time a venture goes public, the founder may own less than 10 percent of his creation, Studer said.
Lamp Post took this idea and turned it on its head.
Instead of taking bigger pieces of the company in exchange for piles of cash, Lamp Post buys a controlling interest of the company in its infancy, and slowly gives it back as the founders reach contractual milestones. Each milestone also triggers an influx of money.
"As they hit these milestones, they earn the company back from us," Studer said. "At the end of the day, we may only own 20 percent to 30 percent of the company."
The method works because the milestones are keyed to risk, he said. In the beginning, a company with no assets or intellectual property is a huge risk. But as ideas are developed and turned into products, the risk dissipates.
Wamp, the communicator for the group, calls the strategy "paying it forward."
"When I sat down with these guys and realized they wanted to empower others with great business ideas, I saw the potential for a rebirth of the entrepreneurial spirit that has defined this city for over a century," Wamp said.
Despite many major outside investments of late, the city has "rested on its laurels" when it comes to starting new businesses, he said.
"We want to reinvest in young business leaders in a meaningful way," he said.
Lamp Post hasn't filled up its current 5,000-square-foot office, and already it's poised to triple its footprint.
Spare cubicle walls lie in stacks against unfinished walls. There's more work than workmen, but better to have too much space than not enough, they say.
Their optimism stems from the surprising demand for their services, a steady flow of ideas for products that hasn't yet begun to wane.
"We see three to five new business deals per week," Alling said. "People say, 'You're in Chattanooga, how many good ideas can there be in Chattanooga,' but there's this backlog of great ideas."
Though a lot of the ideas leverage technology, Studer is quick to point out that Lamp Post isn't only looking for tech ideas.
"If you go back a few years, steam engines were considered new technology; cars were considered new technology," he said. "Technology is just a tool; it's not an end unto itself."
That being said, he's far from a Luddite.
"Allen was the first residential customer to sign up for EPB's [gigabit Internet]," Studer said, gesturing to Davis, who didn't look up from his laptop. "Our interest is in investing in good companies, and if we can bring technology to bear, so much the better."