Larry White, President and CEO of the Atlanta-based Ritz Group Networking Organization
Larry White, president and CEO of the Atlanta-based Ritz Group networking organization, talks with the Opportunist’s Managing Editor Leslie Stone about his company’s brand-new social media platform, its live “Shark Attack” events, and why companies like his are exactly what the economy needs right now.
Election 2012 is finally over and yet serious questions, such as: ‘What about the economy?’ and ‘What happened to all the jobs?’ are still on America’s mind. It’s human nature to blame one administration or the other, or to expect one candidate to be better at restoring the American Dream but, according to recent Gallup data, the U.S. President isn’t as all-powerful as you might think when it comes to jump-starting the economy. In actuality, the data reveals—and quite a few economists concur—local leadership plays a much more significant role in determining whether the economy of a region prospers.
The Ritz Group is among a number of companies who are taking their expertise to the street—as in Main Street—to help small businesses and entrepreneurs get the private equity funding they need to move forward. “Our goal is to try and spur on early seed stage company growth to build the economy and create jobs,” says Larry White. “We meet once a month to connect entrepreneurs raising private equity funds with angel investors, angel funds and venture capitalists for later stage funding.”
Opportunist: How long has the Ritz Group been in existence?
White: Atlanta businessman Whit Blakeley founded The Ritz Group 26 years ago. It started out as an informal group that typically met every Thursday at the Ritz Carlton Hotel in Buckhead, hence the name ‘Ritz Group.’ I bought the organization in June of this year with the specific purpose to add the electronic side, which includes our collaborative social media platform called the Capital Community and other electronic venues. Our former business model limited capital raising to four hours once a month, which we still do at the City Club, but our online platform lets entrepreneurs network with the capital community 24/7, 365 days a year, and also in a virtual ‘pitch tank’ where they talk online to key members of the Ritz Group.
Opportunist: Can just anyone join?
White: Our community is private—by invitation only—and we approve all members to ensure we comply with SEC laws prohibiting public solicitation of private equity. We partner with a number of investor resources and organizations to identify new entrepreneurs and new investors.
Opportunist: How exactly do you help these entrepreneurs get funding?
White: We don’t fund companies; we spend a lot of time helping them make the connection they need to get funding. I liken us to Match.com. We get people their first date. If they get married, that’s between them—we don’t perform the ceremony. [Laughs] Now, mind you, they may have to kiss a lot of frogs to get funding. We know where the opportunities are and we offer plenty of venues in which to showcase a business proposition—from education to featuring video—and entrepreneurs stay engaged and mature through the process.
We can tell almost instantly which ones have their act together and which ones will have trouble presenting their proposition in terms that a potential investor will understand. Our virtual pitch tank saves us a tremendous amount of time and enables us to interview potential entrepreneurs from all over the state and even the region. Our Equity U. provides new courses to teach entrepreneurs and angels how to run and manage a private shareholder company.
Opportunist: Tell us about your social media platform.
White: Our Capital Community is a private Facebook/Linkedin-type of social media platform tailored to Georgia’s private equity fundraisers and capital investors.
Opportunist: How does it work?
White: Each Capital Community member—individual, business or organization—creates their own profile that includes a home page, a wall, links to their electronic collateral, plus their investment stage or investment criteria. The site provides the search criteria to find and be found using investment criteria and/or industry segment. Each member sets their own privacy settings to control who has access to their information.
Opportunist: How much is membership?
White: The Ritz Group is not a pay-to-pitch organization. We are financed by sponsors. It’s free for entrepreneurs, investors and organizations but service providers pay a monthly membership fee or become sponsors. We believe that service providers can play an important role in accelerating new business investment qualifications and deal making. Our premier members pay a monthly membership fee or become one-time $100 fee, and they are featured on the page and get free access to 10 monthly networking events.
Opportunist: Tell us about your newest event, the Shark Attack.
White: We wanted to add something that entices our business heroes back into the private equity-funding arena. Our 45-minute program is hosted by Bob Rathbun, a Fox Sports South broadcaster, and features three Georgia business icons, or ‘sharks,’ vs. three of the state’s best emerging companies looking to raise equity funds. Each of our participants gets a 15-minute session in which to give their three- to four-minute elevator pitch to the sharks. The sharks ask questions and our emcee asks for their opinion. We record the event with two cameras and webcast it live over the Internet and to our main networking exhibitor atrium.
Our first event in October was such a success that we held a second event earlier this month, called ‘Start-Ups in the City,’ which honored Georgia’s female entrepreneurs. All the sharks, presenters and exhibitors and even our host, Atlanta’s specialty Store Retailer and entrepreneur, Bonnie White, were female.
Opportunist: We have to ask, is Shark Attack event a takeoff of the popular reality TV show?
White: Yes and no. First of all, ours is live; theirs is edited for entertainment. [Laughs] We don’t do any of the shenanigans they do on TV, and we don’t feature QVC-type products. And none of our shark/investor participants are going to say, ‘I love your idea and I am going to put XYZ dollars into it today.’ We do more serious equity plays in the tech, retail, entertainment, and food and beverage marketplace.
Our sharks are there to provide one of three decisions: ‘I don’t like it,’ ‘I like it, let me open my Rolodex and help you’ or ‘I really like it and want to meet with you to see what we can do (due diligence).’ It is very professional and well done. It’s the No. 1 successful venue that we have added and we hope to take our presence beyond Atlanta and the Southeast, to anywhere else the Internet can take us. It has really served to identify the ‘new Ritz Group’ brand.
Opportunist: What do you enjoy most about your work?
White: Absolutely everything! I am an entrepreneur. The exciting part about it is that it creates a rekindling of the private equity funding marketplace in Atlanta—without our Shark Attack introduction, you could not have brought these business icons together with these entrepreneurs for all the tea in China. [Laughs] We bring back successful people who made their money and want to give back. They come, enjoy their time and find the opportunity terrifically exciting. They continue to engage with the Ritz Group because it’s a class operation and they can make a difference in today’s economic recovery.
Opportunist: Can you share some Ritz Group success stories?
White: In the past, the Ritz Group helped about five to eight companies a year make the connection they needed to get funding. We can do better. We are proud about the fact that five out of six of our recent Shark Attack event participants got extremely favorable results. One of the sharks, Bill Clement, has a finance background and was a director of Radiant Systems, which was recently purchased by NCR. One of our exhibitors created a portable kiosk for credit unions and Bill thought it was a great idea and started to work with the company. We were advised just the other day that Bill got them an interview opportunity to do a presentation at Wells Fargo and the Publix Employees Federal Credit Union. Those are the kind of success stories that make us proud—when we connect the icon shark with an entrepreneur who had no chance of presenting to Wells Fargo or Publix.
Opportunist: What lies ahead for the Ritz Group?
White: Our goal is to replicate our electronic and physical footprint around the country in chapters, and support that effort with a strategic investment fund so that we have the best of a local point-of-presence supported by our electronic venue. We are also looking at a new private equity model fueled by a strategic fund and the Ritz Group physical and virtual venues that will enable us to subsidize blue chip companies. That is how we can truly leverage our physical and electronic presence in the national marketplace.
Opportunist: Do you believe the strides that companies such as yours are making will eventually help the U.S. economy rebound?
White: Yes; however, the government needs to provide tax incentives for investors to invest in private equity companies—and make that investment more lucrative than investing in the stock market or other forms of investments. I believe that will force the private, pent up money into funding new business resources and bring investors to the table. The Ritz Group, along with other organizations like us, are there to groom and prepare the entrepreneur—in an SEC-compliant way—to meet the requirements they need for funding. It is based on what I call the ‘chicken and egg theory.’ Once investors have an incentive, by way of the government with tax reliefs and benefits to invest in our entrepreneur ecosystem a huge problem has been alleviated.
We have the entrepreneurs; now we need investors back in the game. Providing tax benefits is the way to do it. We really like what [the government] is doing with JOBS Act in terms of reducing the restrictions for public solicitation and we are certainly falling under that umbrella. When we start incentivizing people to invest in startup companies and recognize that some are going to do very well and some are going to fail—that’s the nature of the beast—then recovery and jobs will take a major step forward. The government can easily do that. If we don’t give tax benefits for investing in private entrepreneur companies, then those entrepreneurs will be facing legalities and red tape rather than growing to their fullest potential.
Leslie Stone is an award-winning writer/editor with more than two decades of experience covering business, finance and lifestyle issues for newspapers, magazines and online publications. Originally from Virginia, she currently resides in the Orlando area.
The Ritz Group - www.ritzgroup.org
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