Keith Masavage
Keith Masavage.

COLUMBUS, OHIO — Keith Masavage has spent nearly his entire career working for startups. For the past 35 years, he’s helped launch businesses in Silicon Valley, the Austin-Dallas technology corridor and Research Triangle Park in North Carolina. During that time, he’s followed the familiar startup fundraising model: Hit up your friends and family first, and then sacrifice equity to attract angel investors and venture capitalists.

But Masavage found a new path for his latest venture, Columbus-based Biobent Polymers. Nearly three years ago, Masavage spun off the business from Univenture, a plastics manufacturer in Marysville about 30 miles northwest of Columbus. Since then, he’s raised $1.2 million without giving up any equity in his company.

How did he do it? He took advantage of a sector often ignored by the entrepreneurial class: grants and loans from government and industry sources.

Speaking about his unique fundraising approach at panel session on Wednesday at Columbus Startup Week, Masavage said that though grants and loans aren’t part of the typical startup financial playbook, other founders can replicate what he did.

Here are a few highlights of his talk:

columbus-startupweek-300x122Start small

Masavage urges entrepreneurs to look first at grants and loans programs offered by local and state government sources. He said government websites often have lots of information about startup funding sources.

“But don’t necessarily believe it,” he warned. “Sometimes, states and other government organizations are slow to update their online information, and [the money] may not be available in the same form by the time you get to the pipeline.”

wide shot Keith Masavage second to leftLook to industry

Masavage’s two biggest financial benefactors are the United Soybean Board and the Ohio Soybean Council. Both were intrigued by his company, which is licensing technology developed by the Columbus research giant Battelle. Biobent uses soybeans and other agricultural products to make its plastics.

“These kind of organizations often fund research and development because they’re looking for high-value uses of some the raw materials,” Masavage said.

Seek inside knowledge

The federal government offers many programs — including Small Business Innovative Research and Small Business Technology Transfer grants — but Masavage warns that some proposals are written with specific companies in mind in advance. It helps to talk to someone in the industry with inside information to avoid wasting your time. “It’s going to be almost impossible to wedge yourself in,” he said.

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