5 things Chattanooga entrepreneurs wish they knew before starting a business

Chattanooga entrepreneurs Ted Alling and Kristina Montague offer up-and-coming startups the lessons they’ve learned over the years

Photography by Max Montague (left) and Olivia Ross (right) / Kristina Montague and Ted Alling
Photography by Max Montague (left) and Olivia Ross (right) / Kristina Montague and Ted Alling

There is no one-size-fits-all blueprint for making a new business idea work. But if you were going to venture out, Ted Alling and Kristina Montague would be the people you'd want on your team. Both know the growing pains of starting a business -- and both have figured out strategies for success time and time again.

Kristina Montague

It's been almost 10 years now since Kristina Montague and her business partners noticed something missing from Chattanooga's entrepreneurial landscape. Women.

So in 2013, the group created The JumpFund, an angel investment fund dedicated to increasing participation in women-led growth ventures -- one of few found throughout the U.S. As the name suggests, the fund is about encouraging women to jump in and take the risk of starting a new company.

"We weren't seeing opportunities for female entrepreneurs to secure startup funding, as less than three percent of women-led companies receive venture capital," says Montague. "We also wanted to engage more women as investors, as that realm has been historically male, as well."

To date, the JumpFund now has seven partners and has invested almost $8 million in more than 30 scalable, high-growth, women-led companies throughout the Southeast.

Montague is also a partner in Next Wave US Impact Fund, another fund committed to assisting women investors who are interested in impact-focused pursuits. She is also writing a forthcoming book about launching the JumpFund to help encourage more women to "jump in" to entrepreneurship and angel investing.

(The following comments have been edited for length and clarity.)

1. Get comfortable with financials

A lot of entrepreneurs get excited about their product or service, but don't take time to show proof of concept. Until you're making revenue, it's unlikely you're going to attract investors. You need to get comfortable with financials. That's something a lot of women struggle with, because we're not taught this growing up. It's also important to lean into driving revenue. This will also help in attracting investors and help you better answer diligence questions that may be posed by potential investors.

2. Have your three-minute elevator pitch ready

Leave people curious to find out more -- either clients or potential investors. Rehearse it in your head. Make sure you hit the highlights you would want someone to know. Make it succinct. Leave them wanting more. Too many times, people will go on too long, and that's not helpful.

3. Constantly nurture relationships with potential investors or clients

You never know where your network can take you. Lots of companies who come through an accelerator program like The Company Lab -- they've learned how to create a monthly or quarterly newsletter to share news about how their company is growing. That's important for piqueing interest. Many companies we were with, maybe their companies started a year or two earlier before we invested. But they kept tabs with us. Another way entrepreneurs can do this is through social media, so people can constantly see what's happening with their business.

4. Do good to do well

For me, investing is aligned with my social and environmental values. How are you building and nurturing a team? What are your longterm environmental, social and governance metrics (ESG)? More investors than ever are looking at the double bottom line -- financial, as well as social and environmental impact. More people want their companies to be doing good at the same time they're doing well. And you do well by doing good.

Using myself as the example, I look for investors who are interested in diversity and equity within companies. So, some of my first questions will be -- Are you building a team that reflects a wide variety of perspectives? How are you growing a team that has more diversity? On the product and service side, what impact is that making in the world? How are you affecting things like governance, society, poverty? Who's your founding team? How are you taking care of your employees?

5. Know your audience

If you're looking for investment for growth, research the type of investment vehicle that best fits your business -- debt, revenue based, crowd funding, equity. Many more options are out there now. And understanding where your business lands on the investment spectrum is important before beginning any conversation with a potential investor.

Also, do your own research on any investor before asking for money. What has the experience been with this investor? What's core to their mission and interests? What terms are they offering? Does your business fit their investment profile? What are their core values? Are they interested in your field? With the internet, all this is fairly easy to find out these days.

Ted Alling

"The truth is, there is nothing that can really prepare you for the battlefield of business," says Ted Alling. He should know. Trace the history of almost any of Chattanooga's logistic startup ventures and eventually you'll reach his name.

In 2002, Alling and his lifelong friends, Barry Large and Allan Davis, founded Access America Transport, a $500 million startup -- first merging with Coyote Logistics, which in turn was later purchased by United Parcel Service (UPS). And that was just the beginning.

With their next venture, The Lamp Post Group, Alling and friends made a large investment into Chattanooga's entrepreneurial scene, helping start many businesses that continue to thrive today, including Steam Logistics, Bellhop, Second Story, Reliance Partners, Ambition, Fancy Rhino and Chattanooga Whiskey.

In 2016, Alling and his fellow investors poured their energies into the creation of Dynamo, a venture capital fund designed to reshape the logistics industry. Two years later, in 2018, Alling and his wife, Kelly, established The Chattanooga Preparatory School, a charter school serving at-risk boys.

Most recently, Alling became one of five partners in Brickyard, a venture fund and portfolio group that offers financial support and focused mentorship for startups that relocate to Chattanooga. Open to the young companies all day, every day -- Brickyard offers its residents the mental and physical space needed to grow their businesses.

(The following comments have been edited for length and clarity.)

1. Get crystal clear about your vision and mission

I believe that culture, for a business, comes down to the values of the co-founders and the team. It's extremely important to do some real work to discover what kind of co-workers you want. Really take the time to think about who you are and who you want to hire.

When we hire at Chattanooga Prep School, we look for personality characteristics like joy, courage and sense of purpose. And there are different methods of doing this. Some companies even bring in a facilitator and ask questions like -- What do your next 10 employees look like? When you're starting a new company, your first hires need to set the bar high.

I think companies have had to change their tactics. The "top down" business approach doesn't work. We all spend a huge part of our lives at work -- and companies need to think about making that a place where people want to be, and bring positive energy to that environment.

2. Play longterm games with longterm people

There is a quote by Naval, who is a Silicon Valley investor, that I heard about a year ago -- "Play longterm games with longterm people. All returns in life, whether in wealth, relationships or knowledge come from compound interest." That's a core belief of mine.

I've been lucky enough to work with my two best friends, Barry Large and Allan Davis. We've been best friends since our early college years and trust each other implicitly. We have complementary skills.

In our relationship, I tend to handle sales and marketing. Barry is more finance. And Allan is more operations. We have the three pillars of business. We're playing "longterm games" together. We're taking 20-year views on things.

Business isn't about you, as an individual -- and the quicker you realize that, the better you'll be.

3. Having a support system helps

I got married early, which I sometimes think was an unfair advantage for me -- having someone that could help shoulder a lot of the burden of starting a business, helping me make decisions, always believing in me.

Also, having kids early helped put pressure on me to provide for a family, which gave me some focus. In the tech world, there's the general belief when you're starting, to not have distractions. But I found the opposite to be true.

4. Become a bibliophile

You've got to turn your phone from a time waster to a time investor. With our phones these days, we have so much information readily available. We can automatically listen to Warren Buffet or Sara Blakely or Steve Jobs or Tim Ferriss, who is fuel to me.

I'm obsessed with Audible and listening to podcasts. We spend so much time driving or walking -- I try to use that time to invest in myself, taking in the lessons of those who have gone before me in business.

5. Find a mentor and be a mentor

I've had numerous mentors, professionally and personally. I've learned probably more from my mentee than I've given. But I'm constantly seeking people older and younger to learn lessons from them. I'm a business person, husband and a father. Another thing I did was Toastmasters -- I assumed being a better public speaker would give me more confidence. I believe I learned a lot from it.

At our school we have a mentor program. A lot of people have social capital who can help others who don't. Many of our students don't have the same networks.


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