Dwolla: The Midwest Startup with 700 Interested Investors and a Billion Dollar Idea

How the startup that attracted 700 investors out of Des Moines, Iowa is impacting the world with a unique approach and creative culture.  

WRITTEN BY ALLISON WAY, SENIOR COPYWRITER & CHIEF EDITOR

It’s a pretty big deal to be named a Top 10 Startup of 2011.  But it’s an even bigger deal to be named a Top 10 Startup of 2011 and be from Des Moines, Iowa. 

A few days ago, ReadWriteWeb counted down the Top 10 Startups of 2011, which included a list of some of the most popular new businesses of the year like Zaarly, Fab.com, Pinterest, Dropbox and Evernote.  And among these well-known names was one company that was launched out of Des Moines, Iowa:  Dwolla.  

Dwolla is a mobile payment platform that sends and receives payments to bypass credit card fees.  With Dwolla, a user can sign up, load their accounts and head over to a retailer that uses Dwolla for mobile payments.  Dwolla offers a cheaper, safer and overall better payment experience.  

But in founder Ben Milne’s mind, Dwolla is much, much more than “a different and better way to access money.” 

Instead, Dwolla has become Milne’s haven for creation, innovation and collaboration.  The company has allowed Milne to build a culture unlike any that PayPal or Visa contribute to the user experience.  

“My favorite part of this venture has been the ability to create,” says Milne of launching the Dwolla startup.  “It’s empowering to come into the office with an idea and at the end of the day, it’s built.  At Dwolla, creation is just a part of everyday life.  Solving problems is part of our culture.”

And these problems are not ones that can be shooed away.  Dwolla has been known to be a product that solves “million dollar issues”.  According to Milne, the creation of Dwolla has positively affected people, small business and even large corporations. 

Although Dwolla is extremely successful (with over 700 interested investors and with moves between $30 and $50 million per month), Ben still believes that the company is just at the beginning on the startup journey.

“We have a long way to go,” he says.  “But these successes have truly validated our efforts.” 

But what’s it like building a successful startup out of the Midwest?  Obviously, Ben has not received the same resources or support that he would if he moved the company to Silicon Valley.  So how has the Des Moines startup gotten by? 

“The truth of the matter is, startups are hard everywhere,” says Milne.  “We actually had an advantage because we have a strong team and great community members.  If we had the opportunity to move, I would say no.  It’s good that it’s here.  We want it to be here.” 

How does Ben Milne of Dwolla Think Big?  “I don’t just want to pay the bills.  I want to do something that makes an impact.  I want to solve a problem that impacts the world.” 

We believe that Dwolla does just that. 

Follow me! @AllisonThinkBig

Entrepreneurship: If You Wait Until You're Ready, You'll Never Do It

Vern Cushenbery of Cush Capital says that entrepreneurship is a lot like parenthood: “If you wait until you’re ready, you’ll never do it!”  So dive in, entrepreneurs.

Vern Cushenbery,
Cush Capital

Just before he was leaving for the Berkshire Hathaway Annual Shareholders Meeting in Omaha with clients, I caught up with Vern Cushenbery, chief executive officer of Cush Capital Management, LLC.  As an owner of his own capital management firm, a finance guru, and a big thinker, Cushenbery has launched a successful business after a decade of experience in investment analysis and research.  So how did he do it?  Read my Q&A with Cushenbery himself: 

TBP (Think Big Partners): What ignited the spark to start Cush Capital? 

Vern: I majored in finance in college because I had an interest in the way the stock market works.  I had an attraction to thinking about investments in terms of relative advantage.  One of the common traits of investors like myself is that we are attracted to solving problems.  I thrive in that environment.  Putting the puzzle pieces together in finding that next great investment opportunity is what keeps me going.

TBP: When did Cush Capital launch?

Vern: Cush Capital launched in August of 2008, but our performance dates back to my prior firm beginning November of 2007.  It’s a meaningful date because it was within 2 weeks within the absolute peak of the market.

TBP: What types of success have you seen so far at Cush Capital?

Vern: So far we’ve been able to make it through the second worst downturn in 100 years.  That’s pretty remarkable in itself.  During that period we’ve been recognized by MorningStar as a standout manager.  They awarded us their 4 star rating.  That’s significant.  We are one of only two managers in our category that can make that claim over the past three years.

TBP: Explain to me what makes Cush Capital different than any other capital management firm.

Vern: We are a research organization—that’s what we specialize in and thrive on.  We market ourselves based on a better brand and a better caliber of research.  Most of our competitors in the registered investment advisory space are in the business of identifying and recommending a diversified lineup of mutual funds.  Each mutual fund has a portfolio manager based out of New York, Chicago or LA.  The client never gets to meet the person making the decisions with their money.  We use a different model because we’re a research organization.  We do the research here in town and we can back those decisions up and sit down with our clients and tell them why we are making the moves we are.

TBP: What is your main goal for Cush Capital?

Vern: Our main goal is to grow the firm through better research.  We have goals and price targets for every investment we make, we have milestones for every client we do business with.

TBP: What is one piece of advice that you would give an entrepreneur looking to start a business?

Vern: The first thing that comes to mind is the same advice I would get from parents when my wife and I were thinking about having children, which was ‘if you wait until you’re ready, you’ll never do it.’  That’s also applicable to entrepreneurship!

TBP: How do you Think Big? 

Vern: My biggest aspiration for this firm would be to accumulate enough assets to influence the management teams of companies we invest in.  We want to do business with morally-minded, ethically-minded people of extremely high integrity.  To the extent that we see certain companies engaging in practices that are less than admirable it would be nice if, on the basis of our size, we could influence their behavior for the good of the financial marketplace and for the good of society. That would be tremendous.

Written by Allison Way.

@AllisonThinkBig