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Wasabi Ventures CEO Digs Into His Baltimore Roots

VIINETWORK COFOUNDERS PHIL NEWMAN AND PAUL WINTERLING
VIINETWORK COFOUNDERS PHIL NEWMAN AND PAUL WINTERLING
You can take Tom "TK" Kuegler out of Baltimore, but he’ll leave his heart and checkbook behind. 

Kuegler, an Essex native and Loyola University grad, left Charm City more than ten years ago for the wilds of Montana. There, he indulged his passion for the outdoors while regularly commuting to San Francisco to indulge his other passion--early stage technology companies. 

Four years and several startups later he co-founded Wasabi Ventures LLC, a Silicon Valley venture capital and consulting firm, and moved to Manchester, New Hampshire. 

But Kuegler's heart kept tugging him back to his hometown. Two years ago, he joined the Board of Sponsors of the Sellinger School of Business at Loyola and recently inaugurated the startup advisory Wasabi Ventures Accelerator. And last month Wasabi joined a syndicate of investors including Baltimore Angels and Blu Venture Investors of Vienna, Va., to ply Baltimore startup Social Toaster with nearly $2 million in capital. 

Between Loyola and his business interests, Kuegler spends "about a week per month" in Baltimore. He is bullish on Baltimore and its emerging tech community but admits that Wasabi would not give the city such "special attention" without his own ties here. 

Unlike Kuegler, Wasabi was not born in Baltimore. In 2000, Kuegler and his firm's co-founder Chris Yeh conjured up the name for their new company on board a flight to San Francisco, in honor of their fondness for – surprise! – sushi. 

Wasabi’s global headquarters remains in San Mateo, Calif. Kuegler heads up the East Coast operation out of Manchester, where he oversees the Loyola project. There’s even an overseas office in Donetsk, Ukraine. 

Kuegler spends three to four days per month on the Loyola campus, overseeing the accelerator and teaching classes at the Sellinger School. Staffed by Loyola grad students Cori Kaylor, Scott Ferguson and Jimmy Bahr, the accelerator is currently nurturing two startups, VidStructor and Point Click Switch, and has hired Loyola students as interns and staff. Wasabi will employ seven people in Baltimore by the late fall, including a venture partner, a marketing/outreach person, and several analysts.

VidStructor originated as an online interactive training resource for baseball and other sports. Last year, founder Phil Newman, CEO of Columbia’s ViiNetwork Inc. and a former baseball coach at Johns Hopkins University, launched VidStructor as a software-as-service product. After raising more than $500,000 last summer, the company joined the accelerator, where Wasabi has been providing sales and marketing support. The company employs 10 people and is in the midst of raising $3 million.

“We’ve been fortunate enough to have Wasabi as an investor and contributor,” Newman says. 

VidStructor’s fellow accelerator company Point Click Switch, helps commercial and residential consumers change to less expensive gas and electricity suppliers. Phil Croskey, CEO of Maryland Energy Advisors and head of Point Click Switch, has called the company a Priceline for the energy consumer. Here again, Wasabi is providing the Loyola startup with in-depth counseling before adding funding and marketing support. The company has about 24 commercial and 800 residential customers, and is seeking an undisclosed amount of fresh capital. 

Last May, Wasabi announced a third tenant at the accelerator, online education startup CodePupil, but Kuegler says that company has entered "a dormant phase." On its website, the company credits Wasabi as "integral" to its creation and thanks the firm for its support and advice. CodePupil's Ryan Spahn  could not be reached for comment about the company's current status. 

The Loyola accelerator may be the perfect proving ground for Kuegler’s business and investment philosophy. He says Most investors in startups these days "swing for the home run, but they also strike out a lot.” - Tom "TK" Kuegler Traditionally, entrepreneurs thought first about building a great company that could grow slowly to build liquidity.

Wasabi serves not just as a source of cash but as a source of advice and experience in the early going. With the added nurturing up front, Wasabi’s portfolio companies are designed to achieve more sustainable growth than companies whose investors rush them to market for a quick killing.
 
Ronald Diegelman, entrepreneur-in-residence at Baltimore's Emerging Technology Center and a co-founder of numerous startups, does not entirely agree with Keugler’s viewpoint. "I don’t necessarily believe that investors are in it for the quick kill.” Investors know that early-stage funding is a five-to-seven year commitment and three to five years during the ramp up phase. The time frame is about twice as long for biotech ventures.

Wasabi's recent investment in Social Toaster, a three-year old firm helps companies market themselves on social media platforms, departed from its focus on very early, "pre-revenue" tech companies.  What attracted Kuegler to Social Toaster?  

“They have great traction and their customers love them,” he says. Social Toaster's clients include the Baltimore Ravens and  Kimora Lee Simmons’ online shoe and handbag shop JustFabulous.

Razzaque says of Kuegler, "I am impressed by his intelligence and candor. He is a no-nonsense individual who can readily assess whether or not there is any potential in an early-stage company.”
 
Kuegler, whose parents live in Elkridge, still tells people he is "from Baltimore" and roots avidly for the Ravens and Orioles, thereby risking mutilation from New England Patriots and Boston Red Sox fans.

And he still thrives on sushi. During his Baltimore visits, he favors Federal Hill’s Matsuri and Mount Vernon’s Minato.

Richard Rabicoff is a longtime Baltimore journalist who was most recently managing editor of Citybizlist.


PHOTOS:

ViiNetwork co-founders Phil Newman and Paul Winterling sit outside Wasabi's Baltimore office.

Junior analysts Scott Ferguson and Cori Kaylor work at Wasabi's office.

All photographs by STEVE RUARK

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