As investment prospects go, I’m encouraged by what we’ve seen to date.  I’ve spoken with a few investors and generally, those that take the time to listen to our pitch end up liking the concept and seeing the merits of the business plan.  We’ve received our fair share of “No Thanks” and there’s been times where the refusals were flat out rude but that’s all part and parcel to the process of raising funding. 

To date, we’ve had a positive meeting with the folks at the Kentucky Enterprise Fund and two other solid meetings with private equity investors.  Both of the private equity investors expressed interest in the first round of funding for our prototype as long as we could find where the second round would come from.  In fact, everything seems to hinge upon where the second round of funding comes and when to the point where my current meetings are pitching the second round moreso than the first round.  If I could answer that question today, I firmly believe that we would have term sheets for the first round in hand in short order and we’d be off and running.  Most Louisville investors that I talk with tell me that I won’t be able to raise the millions of dollars to do the project from Kentucky, Indiana or Ohio sources.  They tell me that it might be possible in Nashville given that city’s disposition towards entertainment and I’m working to get a couple of referrals to get me introduced to that market.  In all likelihood, I’m going to have to travel to the coasts or north to Chicago to find the full investment.

I get that.  I even agree with the sentiment even though I wish that the venture capital community in Louisville could do a deal like our deal.  Considering that Greater Louisville Inc. is reporting the total venture capital dollars in the Louisville area to be less than $20M for 2009, I can understand where some of the people I’ve talked with are coming from.  However, I need a solid prototype to go out to the coasts to raise money.  The prototype that we shopped to Ncsoft will not cut it in today’s environment.  That’s where the first round of investment comes into play. 

We continue to look for that second round of funding and I still have a positive outlook of our chances for successfully raising funding for the prototype round.  There’s a good chance that the prototype round will be oversubscribed giving us more money in the first round while lessening the burden of what must be raised for the second round.  I’m confident that with a prototype in hand, we’ll be able to raise the second round and subsequent rounds so that two years from now, we’ll be looking at the release of our game.  As usual, more information will come as I get it.  For now, I’m in somewhat of a holding pattern while I await the decision of the key players in the first round of investment. 

Stay tuned.