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Silicon Pastures evaluates investment in two startups

Thursday, October 25, 2018   (0 Comments)
Posted by: Molly Dill, BizTimes

Milwaukee angel investors this week heard pitches from two Wisconsin startups seeking funding at a meeting of angel investment network Silicon Pastures.

Pete Marsnik presented on McFarland-based electrochemical disinfection company Bioionix Inc. The company uses super oxidants to continuously disinfect brine processing, brine chilling and seawater liquids used in producing cheese, ready-to-eat meats and fish farms.

"We provide food safety. We also provide plant safety and employee safety,” Marsnik said. "With that food safety, you have that brand protection that that company ultimately needs.”

Among Bioionix’s customers are Kraft, Smithfield Foods and Costco. The company was established in 2006 and is close to the breakeven point, with an expected $92,000 net loss for 2018, said Marsnik, the chief executive officer. He is projecting 2019 net income of $82,000 on $2.3 million in revenue.

Bioionix has also been accepted into the 2018-19 FaBcap accelerator class for growing food and beverage companies.

The company is restarting its $2.5 million Series B funding round, which it first launched in 2016 to raise about $1 million, Marsnik said. He is also executive director of the Chippewa Valley Angel Investors Network, and is among the investors in the company.

"The use of funds is marketing, new hires, the new product and platform development, including IP and working capital,” he said.

A potential investor asked about Bioionix’s data to demonstrate its return on investment.

"The competition on the capital equipment side is going to be UV light, which is quite a bit less expensive, or chloride dioxide generator, which you need chemicals and that’s not an easy process to control,” Marsnik said.

Andrew Hoeft, founder and CEO of Madison-based Pinpoint Software Inc., discussed the company’s operations-focused software for supermarkets, health care and restaurants.

The company has two products: DateCheck Pro, an expiration date management program; and Taskle, a mobile checklist and auditing solution.

Hoeft worked for Festival Foods in high school and college, eventually managing expired food. Like every other supermarket in the country, it was unable to keep up with expiration dates, he said.

"They know that they don’t rotate products well because they stock far too much inventory in a night to basically afford the staff that can consistently rotate 100 percent of the items they stock. So they recognize they only rotate 30 to 40 percent of their items,” so they use a spot-checking schedule, Hoeft said.

The average supermarket in the U.S. has more than 1,600 expired items just in the center of the store among shelf stable products.

DateCheck Pro keeps track of expiration dates across the store and alerts employees to items that are about to expire.

Pinpoint’s other product, Taskle, helps managers conducting an audit at a store keep track of issues to be addressed from previous audits while they’re on site, and identify companywide trends in their audits.

The company which has a pre-money valuation of $5 million, is seeking to raise $500,000, Hoeft said. The Wisconsin Economic Development Corp. has committed to match 25 percent of the round.

In a closed session portion of the meeting, the investors discussed the potential of investing in the startups.

"Several investors chose to move forward with performing additional due diligence on both companies,” said Teresa Esser, managing director at Silicon Pastures. "So they both made it to the next step in the due diligence process.”


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