Financing Business Growth: Three Montana Case Studies

by Shannon Furniss for the Montana High Tech Business Alliance

“The American dream is alive and well and it has a lot to do with people who have been successful and give back and lift people up.”

-Luke Mauritsen, Founder and President of Montana Instruments

Access to capital is the second biggest barrier to growth for Montana’s high tech and manufacturing firms, according to a Montana High Tech Business Alliance survey conducted in February 2015. The Alliance’s recent CEO Roundtable in Missoula featured three companies – the Audience Awards, Montana Instruments, and Goomzee – that have been able to work through funding challenges and find creative ways to grow their businesses. Read on to learn how they did it.

#1 Audience Awards: A Filmmaker Launches an Innovative Marketing Platform with Help from a Grant, Friends, First Interstate Bank, and Goodworks Ventures

Paige Williams headshot-small

Paige Williams, Founder and CEO, the Audience Awards

As an award-winning filmmaker, Paige Williams has experienced first-hand the value of audiences voting for and awarding their favorite films. That’s why she founded the Audience Awards, an online social platform that connects audiences to filmmakers, film festivals, film schools, and businesses through video contests.

Based in Missoula, the Audience Awards has been featured in the Huffington Post, Forbes, Entrepreneur, and Inc. Magazine for being an innovative marketing platform and a pioneer in user generated content, running contests for tourism boards and major brands like Hilton and Kodak.

Getting to this point has been a journey, according to Williams, and she has financed a successful business through “sales, bootstrapping, staying lean, and learning and relearning how to do things” as well as a little help from angel investors in the first year.

Williams got her start in 2013 when she wrote and was awarded a grant from the Montana Film Office to produce videos for the newly created Montana YouTube Channel. The grant money also allowed her to start the Audience Awards.

In November 2013, Williams launched the Audience Awards as a beta site and began to build her business through film contests, ad sales, and brand sponsorships. She soon realized that more capital would help speed the company’s growth and decided to do an angel round with three investors – two friends and Goodworks Ventures LLC, a Missoula-based firm that invests in early- and mid-stage companies.

The angel investments were structured as convertible notes, so that when the note became due, Williams would have the option of converting it to equity or paying it back with interest. This method gives businesses the option to receive financing while maintaining as much equity as possible.

Dawn McGee

Dawn McGee, CEO, Goodworks Ventures LLC

Goodworks Ventures’ portfolio spans a diverse selection of companies – largely Montana-based – including everything from software to lighting to agriculture.

“We are looking for companies that are paradigm changing, have the potential to do good work, and have the potential for financial returns,” said Dawn McGee, CEO of Goodworks Ventures.

In addition to providing money, Goodworks Ventures tries to add value by helping companies think through the challenges. “The money’s one thing, but trying to help you get to the end game where we are all working together to help the company succeed is really important,” she said.

Relationship with First Interstate Bank Takes Audience Awards to the Next Level

With some financing in place and a year of learning from the beta site, Williams relaunched the Audience Awards in 2014. She realized that she had “tons of work to do and had to hire people,” so she went to visit a banker she already had a business relationship with – Sue Larew, vice president of First Interstate Bank in Missoula.

Sue Larew

Sue Larew, Vice President, First Interstate Bank Missoula

The first thing Larew did was to look at Williams’ business plan, sorting through the numbers and making changes. “Sue and Kay Wenzel [also a First Interstate bank officer] did it as a service to help me think through the business model,” Williams said. “They gave me pointers, and it really helped. We were able to build a stronger business plan.”

Through First Interstate Bank, Williams secured a business line of credit for bridge gap funding to hire employees and grow her business. Williams says the line of credit is set up so she can use it as needed and is secured with her receivables, which in her case, include her film library and other assets.

Larew considers herself not just Williams’ banker but a partner in her success. Williams’ good credit made the arrangement with First Interstate possible, Larew said, adding that “she is a good business woman and it is a delight to work with her.”

The ongoing relationship is important to both Larew and Williams. “Both of us are honest, direct, get it done women,” Larew said. “It works well for us.” And, it is important that bankers be involved in the business process as early as possible.

“Bankers need to be there early, hear the story, and be part of the journey so we can be clear supporters of what is trying to be accomplished,” Larew said.

Today the Audience Awards has six employees and four interns. Williams expects to have one million-plus visitors to the website during December when she is running five film contests – three for Homewood Suites and Home2 Suites by Hilton, one for Colorado, and one for Kodak.

Williams and Larew still check in regularly about the business. For Williams, “the continued, ongoing faith th at Sue and the bank lend me is more valuable and validating than the line of credit.”

Read more about Williams and the Audience Awards in this article: The Audience Awards: Montana Entrepreneur Leverages Technology for Filmmakers and Businesses.

#2 Montana Instruments: Problem-Solving Scientist Pioneers the Way with Help from Angel Investor, Friends and Family, and Rocky Mountain Bank


Luke Mauritsen, Founder and President, Montana Instruments

Luke Mauritsen, founder and president of Montana Instruments, came up with the idea to start a business while working as a researcher at S2 Corporation in Bozeman, developing cryogenic technologies for defense applications. As a researcher, he was able to see the pain points, that experiments conducted at low temperatures were difficult and time-consuming, and there was no equipment on the market that had the performance that was needed.

Mauritsen worked at S2 Corporation from 2005-2008. Shortly after, he founded Montana Instruments to create high-precision optical measurement solutions for research, industry, and education.

To start the business, Mauritsen had a small angel investment from Quantum Design International, a company that manufactures and distributes scientific and industrial instruments worldwide. With headquarters in San Diego and offices around the world – and in Bozeman – Quantum Design “decided to give a Montana kid a chance and see what could happen,” Mauritsen said. Quantum Design now distributes for Montana Instruments in overseas markets. Bozeman has more than 25 photonics/optics companies, many of them founded by Montana State University graduates, often through MSU technology transfer.

Friends and family also helped out with additional loans, and in 2011, the company sold its first instrument.

As Montana Instruments began to grow, Mauritsen decided that some working capital would help the company, and he approached a Bozeman bank about getting a business line of credit. But the bank, which was more accustomed to funding agriculture and real estate, didn’t seem to understand the unique needs or vision of a high-tech manufacturing company, he said.

“The bank might have been more comfortable if we sold tractors instead of high-value instruments worth more than $100,000 each,” Mauritsen said.

Partnering with Rocky Mountain Bank to Reach Strategic Milestones

After initial struggles with financing, Montana Instruments has developed a “fantastic” relationship with Rocky Mountain Bank in Bozeman, Mauritsen said. “Rocky Mountain Bank gave us a credit line that was double the other bank in a week.”

“Admittedly, Montana Instruments is a unique company that some banks might struggle to understand, but they are exploring some new areas of technology and pioneering the way,” according to Bob Gieseke, market president at Bozeman’s Rocky Mountain Bank.

Bob Gieske - linkedin

Bob Gieseke, Market President, Rocky Mountain Bank Bozeman

At Rocky Mountain Bank, Gieseke says they take the team approach to working with clients. It’s not just one banker’s responsibility to understand the business – there is a team that works with a company on its business plan and strategy. What is most important is understanding a company’s strategic vision and the milestones and goals they have set to reach it, Gieseke said, adding that Rocky Mountain Bank and Montana Instruments have become partners, working together on business planning and goals.

And Montana Instruments has proven that they are good managers, Gieseke said. Even though they had the credit line, they were able to operate on their own cash. “They didn’t have to lean on the bank that much, and that built up trust with us.”

Last year, Montana Instruments identified a new product opportunity, which would address an important need for scientists today. Mauritsen knew that he needed money for research and development and to cover additional employee salaries – and that he could pay it back quickly – so he went directly to Rocky Mountain Bank with a plan showing how a $400,000 loan would be used and paid back.

While research and development is usually funded through grants and venture capital and most commercial banks might hesitate to finance these types of activities, Montana Instruments had built trust with Rocky Mountain Bank.

“It’s rare that we’d do that,” Gieseke said. “But we had a strong, strong relationship with Luke and his team.”

The line of credit for research and development is secured by Montana Instruments’ business assets – equipment, inventory, and accounts receivable. The bank and the tech company meet monthly to discuss business and financials. Montana Instruments is showing sustained growth, and the product mix is well-received, Gieseke said.

Montana Instruments has an impressive customer list including Delft University, MIT, Harvard, Montana State University, Hewlett Packard, and Micron. This year, Montana Instruments hired its 30th employee and is looking to hire five more in the next few months. Strong relationships and help from friends and family, an angel investor, and Rocky Mountain Bank have helped Montana Instruments along the way, Mauritsen said.

“The American dream is alive and well and it has a lot to do with people who have been successful and give back and lift people up,” he said.

#3 Goomzee: Entrepreneur Provides Mobile Technology Services to Real Estate Agents with Help from Angel Investors, Venture Capital Firm, and Goodworks Ventures


Mike Sparr, CEO and Founder, Goomzee

Mike Sparr, CEO and founder of Goomzee, started the business after his career as a consultant at Accenture’s San Francisco office. A Management Information Systems graduate from the University of Montana School of Business Administration, Sparr had no way of knowing what type of “crazy journey” it would be to get his business going.

In 2003, after relocating from San Francisco to Reno, Nevada, he started by selling his software to local businesses, eventually providing online storefronts/websites for 73 companies. Sparr had roots in Missoula’s business community through his family business, Sparr’s Towing & Automotive, and often returned to Montana to stay with friends and sell services to Missoula businesses. By day, Sparr sold his software door-to-door. By night, he did programming and consulting, using the money he earned to build the company. In 2005, he moved to Missoula.

Goomzee was profitable and growing, but instead of giving himself a paycheck, Sparr spent the money on mobile technology research and development. He also used his personal savings and credit cards to cover business expenses in early years. In absence of a paycheck for the first few years, he replenished his personal savings by “buying/fixing/flipping” single-family homes in Montana and Nevada. His real estate dealings ultimately led to a pivot in the company’s focus.

In 2005, during a speaking event for SCORE, Sparr heard the story of a successful entrepreneur in the Bitterroot named Rob Ryan. A pioneer in the high-tech industry, Ryan founded Ascend Communications in 1989 and a decade later sold the company to Lucent for $25 billion. After his retirement from Ascend, Ryan launched the Entrepreneur America boot camp for startups from his 1,000 acre Montana ranch and published a book, “Smartups,” that teaches would-be entrepreneurs the skills they need to get through the venture capital process and build companies that will grow and succeed.

Another successful Montana entrepreneur who worked with Ryan was Bozeman’s Greg Gianforte, who later became a great mentor and friend to Sparr. Gianforte founded RightNow Technologies in Bozeman and sold it to Oracle for $1.8 billion. In his own book, “Bootstrapping Your Business: Start and Grow a Successful Company with Almost No Money,” Gianforte writes about how lack of money is actually a competitive advantage because it forces entrepreneurs to concentrate on selling their products to customers to bring cash into the business.

“At RightNow, I had forty customers before I hired the first employee,” said Gianforte in an article published in Small Business Trends. “Then we doubled revenue every 90 days for two and a half years without raising any outside money.”

Inspired by these entrepreneurs who built multi-billion-dollar businesses, Sparr set out to do the same for Missoula.

A Difficult Journey Raising Venture Capital Money in Montana

In 2007, Sparr launched his first real estate product, Goomzee Connect, a text message marketing and lead capture service for realtors. In 2012 he launched a second real estate product – a mobile Multiple Listing Service app where realtors can access MLS data through smartphones. Goomzee now provides mobile technology services to nearly 200,000 real estate agents, with major markets in Illinois, California, Florida, Texas, Oregon, Idaho, Nevada, Pennsylvania, Michigan, and Colorado.

“There were some scary times, and I had to go to marriage counseling for nine months.”

-Mike Sparr, CEO and Founder, Goomzee

In mid-2007, with a working prototype and customer interest, Sparr approached a bank about getting a line of credit or loan, but received a rejection letter from the bank even though he had a strong credit history.

“I pinned the letter to a cork board in my home office as motivation,” he said. Soon after, he secured a $100,000 business credit line from First Security Bank, and then the former Missoula Area Economic Development Corporation (MAEDC) matched it. Sparr was able to move into an office and recruit two fellow University of Montana graduates to help.

By August, Sparr and his team were cold-calling real estate agents throughout the West, selling to individual agents in 15 states before the economic recession really hit. One of those cold calls, however, turned into Goomzee’s first enterprise contract, a Multiple Listing Service (MLS) that licensed his software for all their members at once.

At that point, Sparr realized more funding would be necessary to grow a national presence. He secured early angel investments using convertible notes and hired a couple of people to help him with cold calls and tech support. Nearly a year later after countless tradeshows, meetings, and exhibits, he made a second enterprise sale, and then more deals followed.

The most stressful times were yet to come. To scale up faster, he sought out venture capital funding. Sparr spent several months pitching venture capital firms, 16 of them in Silicon Valley, several on the East Coast, and several on the West Coast. He got a term sheet from a venture capital firm in Texas, but they wanted him to relocate. That wasn’t an option because he wanted to stay in Montana.

The growing pains put a strain on Sparr’s finances and his family. “There were some scary times, and I had to go to marriage counseling for nine months,” he said.

Finally, Sparr discovered a group the Montana State Board of Investments had invested in – Highway 12 Ventures in Boise – that was supposed to invest in Montana companies. He pursued them relentlessly. Every time Sparr closed another MLS contract, he sent their partners a note. After over a year of courting and updating the Boise group, they negotiated a term sheet for $1.5 million, rolling in his early angel investors on the deal, and he was able to keep his business in Montana.

In 2012, Sparr decided to build his second product and needed funds to hire mobile app engineers. The existing VCs and angels stepped in, and so did Missoula’s Goodworks Ventures. After pre-selling deals around the U.S. while the product was being developed, upon launch he’d already sold enough contracts to take Goomzee to profitability. The company now has nearly $3 million in total revenues and the employee count ranges from eight to 15 depending on the project load. Half of Goomzee’s employees are based in Montana, and Sparr says he is committed to growing his Montana presence.

“I bootstrapped as far as I could,” Sparr said. “I retained considerable equity because I had the ability to sell, and I saved money by doing a lot of the work myself.”

Leveraging Montana’s Supportive Startup Community

In the February 2015 survey, Montana High Tech Business Alliance members cited a “supportive business community” as one of the top three benefits to doing business in Montana. Indeed, a thread that runs through all three case studies is the support these entrepreneurs received from mentors and investors in the state. The right financing at the right time was key, but advice, inspiration, trust, and belief in their future success were also essential to startup business growth, and in many cases worth more than money.

Startups in high tech and manufacturing are encouraged to join the Montana High Tech Business Alliance. Companies under five employees can join for free or with a voluntary donation. Apply for membership today.


Top photo caption: Montana High Tech Business Alliance members discuss ways to finance business growth at the CEO Roundtable in Missoula, Oct. 22, 2015 at First Interstate Bank. Image by Thomas Kurdy, Ndigena.

About the Author: Shannon Furniss is a Missoula-area journalist and president of Market Interactives. She writes articles on business trends and issues for the Montana High Tech Business Alliance, the Montana Business Quarterly, the Montanan, and other publications. She holds a degree in journalism from the University of Montana.

About the Publisher: The Montana High Tech Business Alliance is a statewide membership organization made up of more than 250 high tech and manufacturing firms and affiliates. More information on the Alliance can be found at:

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