Springfield angel investors who sunk startup capital in St. Louis-based Aisle411 Inc. last year are helping to foot the bill for the company’s next round of expansion.
The mobile product search company plans to blanket seven cities, including Springfield, with its consumer service in 1,400 retail stores by year’s end. Organizers say investors doled out $1.8 million, including an undisclosed chunk of change from Springfield Angel Network investors, to back the plan.
Aisle411 hopes to be functional in 600 Missouri stores by mid-November, said Nathan Pettyjohn, co-founder and CEO. Targeted cities are St. Louis, Springfield, Kansas City, San Francisco, San Jose, Calif., Chicago and metro New York City.
A new approach After launching in 2008 by marketing to specific stores, the new initiative takes the service across entire cities. In Springfield, Price Cutter signed on as partner last year. Now, Aisle411 is working to be operational in area stores such as Dillon’s and Lowe’s.
A key component to the citywide plan is the use of public information while sticking with its core purpose of helping shoppers navigate retailers by guiding them via text or voice messages. Consumers call a toll-free number – (877) 247-5341 – from their cell phones and ask for the specific location of store products.
“In the past, we were talking with retailers. We approached them on a pay us, we will build it kind of model,” said Pettyjohn, a Drury University alumnus.
Instead, Aisle411 plans to go city-by-city to gain subscribers. “We source publicly available information in the form of store maps and directories,” Pettyjohn said. “To the average person, it creates minimal value. We’ve created some technology, we can take that information and embed it so that we can now locate 50,000 different items that are tied to a store directory and map.” The new technology, Pettyjohn said, will allow Aisle411 to expedite growth plans. Pettyjohn is planning for as many as 80,000 consumer subscribers to the free service.
That anticipated growth is welcome news for Tom Singleton, who is among the local investors. Singleton said he remains involved, although it’s from the background.
“I haven’t been to a shareholders’ meeting in quite some time,” Singleton said.
Singleton invested in the company when he was executive-in-residence at Edward Jones Center for Entrepreneurship and Innovation at Drury and on the board of the Springfield Angel Network. He left the Edward Jones Center in April to return to retirement and was succeeded as executive-in-residence by Jim Conley, a member-owner of Rangeline Marketplace LLC and an associate of the Kingsley Group.
Although the new business plan makes retailer involvement less essential, they still can participate directly in the Aisle411 service by providing inventory information, Pettyjohn said. The direct participation cost to retailers is up to $1,000 annually, he said, depending on the number of store locations and the type of inventory reporting involved. Aisle411 also earns revenue from special promotions and coupons from product manufacturers.
Retailers see Aisle411 as a way to promote their stores and the products they offer, he added.
About the angels Springfield Angel Network is a nonprofit corporation that introduces startup and existing entrepreneurs from Missouri to individuals capable of investing financially. Missouri State University, Springfield Area Chamber of Commerce and Springfield Innovation Inc. formed the network in 2008 under the guidance of Drury’s Edward Jones Center.
Angel Network investor identities are held confidential, according to the group’s guidelines. No investors chose to speak to Springfield Business Journal for this story after Singleton made an interview offer during an investor board meeting last week. Singleton remains involved with Springfield Angel Network, but he declined to disclose his personal ante.
The Springfield Angel Network formed with about 20 members – each with a net worth of more than $1 million or an annual personal income of $200,000.
Annual membership is $500, and each member is expected to invest a minimum of $25,000 a year. Investors are encouraged to actively steer the deal by offering their expertise or perhaps sitting on a company’s board of directors.
Pettyjohn and Aisle411 Chief Operations Officer Matthew Kulig received business advice in 2009 from Drury University’s Edward Jones Center for Entrepreneurship and Innovation, and an undisclosed capital investment from the Springfield Angel Network to launch the program in Springfield.
Pettyjohn declined to provide a breakdown of the new investments but said funds came mostly from friends and family. On board with the new plan are the St. Louis Arch Angel Network and St. Louis investor Hal Gentry, a veteran in the computer software industry.
Pettyjohn said his company wants to make the service available to all types of phones.
“We’ve been developing and refining our smart phone offerings,” Pettyjohn said.
The company also is developing an iPhone application.
“I have a lot of confidence in them.” Singleton said. “I’m not an (information technology) guy. I don’t understand what they’re doing, but I believe in them.”[[In-content Ad]]
