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My Quarterly Update: Q3 2024

A concept that I have been thinking a lot about lately is staying power. The longer that you work at something, the more likely you are likely to achieve outsized success. If you can work at the same job or on the same business for many years, even decades, eventually you will learn almost everything there is to know about your job and be better at it than everyone else. You will face every issue someone in your industry will likely run into, make it through multiple economic cycles, and just fundamentally know what you are doing.

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For me, it’s easy to dismiss newcomers to the business world who make a big splash and create waves because they haven’t been tested yet. You have a strong personal brand and are raising money for an investment fund? Great, let’s chat a few years from now after you have raised two funds and generated positive returns. You’re launching a new startup that’s going to revolutionize an industry? Sure, the idea sounds amazing today because it’s all blue sky. Let’s see how it shakes out after five years. You have a huge social media following and just acquired an existing business that you are going to market to your followers? Cool, tell me how it’s going a few years from now.

A big chunk of my career success has come from working on the same things since I was a kid in the late 90s. I had a website where I was making money through advertising revenue 25 years ago. Before Google AdSense existed, I was earning advertising revenue online. I am still earning money through digital advertising today and hope to be doing that for the next decade or two. While I’m not as flashy as people who can attract huge audiences to conferences, and I don’t have 200,000 Twitter followers, I do have staying power.

Serving as DSU’s Commencement Speaker

The concept of staying power was one of the big themes in the commencement address that I gave at my alma mater, Dakota State University (DSU), in May. I was thrilled to have the opportunity to address Dakota State’s graduates and share some of the things I have learned since graduating from the university 18 years ago. Speaking at DSU’s graduation was a full-circle moment in my life, and it will be a day that I remember for the rest of my life. The university was also kind enough to award me an Honorary Doctorate in Public Service for my contributions to DSU and the Sioux Falls Area. This is an honor that I wasn’t expecting and am humbled to have received. If you want to watch my commencement speech, it is available online here.

Work and Family Travel

It’s been a busy family travel season. I took the kids to Kansas City for a quick weekend trip in May. We spent a weekend in Minneapolis for our nephew’s high school graduation. We stayed at the J.W. Marriott at Mall of America so we could do some shopping while we were there. The following weekend, we drove over to Wisconsin and stayed at the Kalahari Resort in the Wisconsin Dells. We also drove over to Sullivan, WI, for our niece’s high school graduation party.

Finally, I took Micah to Washington, D.C., for several days so that he had the opportunity to see some of the sights. I made progress toward my goal of seeing all four remaining space shuttles after seeing the Space Shuttle Discovery at the National Air and Space Museum. We were privileged to be able to participate in a capitol tour and a White House tour, thanks to some help from Senator Thune’s office. We also visited the Lincoln Memorial, the Smithsonian Natural History Museum, the National Mall, and several other monuments. Karine and I plan on taking a “no kids” vacation sometime this summer but haven’t landed on a destination yet. We are also getting new wood flooring in our house later this month, which will preclude travel for a couple of weeks.

MarketBeat Update

MarketBeat’s primary focus during the second quarter has been the redesign of our website. We last redesigned our website in 2019 and felt it was time to freshen things up a bit. Our new design features a more traditional color palette for a financial news website (blue, white, and gold). It also includes a new homepage design, a new article template, a new stock ticker page template, and a new navigation menu. We’ll finish migrating the rest of our brand components (newsletter templates, mobile app) to the new design in the third quarter and start on a new project after that.

MarketBeat Website Redesign

We welcomed two new team members during the second quarter.  Shannon Tokheim joined MarketBeat as an associate editor in May. Shannon most recently worked as a middle school English teacher in the Dell Rapids school district. Bridget Bennett also joined MarketBeat as an associate editor. She most recently worked as the evening news anchor for KELOLAND News. Both Shannon and Bridget will work under Don Miller as part of our growing content team.

Our second quarter was a bit slower than the first quarter from a revenue perspective, although still very strong overall. This is primarily due to economic uncertainty created by higher-than-expected inflation numbers and the reality that the Federal Reserve is unlikely to cut rates this year as aggressively as previously suggested. MarketBeat’s revenue tends to correlate with stock market sentiment. When investors are exuberant, MarketBeat does well. When investors sour on the market, our web traffic, email open rates, and revenue decline. MarketBeat’s business also naturally does better in the winter months than the summer months, because people generally aren’t thinking about their stock portfolio when they are on summer vacation.

Finally, MarketBeat won two more business awards. First, we were included on the Inc. Regionals Midwest list of fastest-growing companies in the region for the fifth consecutive year. We also received an Inc. “Best Places to Work” for the first time. Later this summer, we expect to be listed on the main Inc. 5000 list for the ninth consecutive year.

Venture Capital Update

The regional venture capital ecosystem has had an exceptionally busy Spring. Homegrown Capital, Falls Angel Fund, and several of our co-investors have seen above-average investment activity this year. Falls Angel Fund III made its final two investments in May, betting on LeagueOS and StringTree. There are no immediate plans to launch a Falls Angel Fund IV, but Enterprise Institute will likely launch a new state-wide pre-seed stage venture capital fund sometime this year.

My venture capital firm, Homegrown Capital, made several new investments this year. We invested in Pear Commerce, an e-commerce technology provider that connects large consumer-packaged goods (CPG) brands to retailers that have their products in inventory. We invested in CoCo Coders, which offers online programming classes to students. We also invested in Grain Weevil, a small robot that makes it so that farmers don’t have to work inside grain bins. Finally, we made follow-on investments in both Pitchly and SiteKick.

We are on track to wrap up the initial investment period for Homegrown Capital Fund 1 this year. We are also starting to design our second fund, which will likely launch in early 2025. In our second fund, we will continue to invest in early-stage technology companies, although we will likely expand our geographical reach a bit and increase our average check size in each company.

Commercial Real Estate Update

We wrapped up two projects during the second quarter. The MarQ, a 164-unit apartment complex at 69th and Tallgrass in Sioux Falls finished up during the second quarter. The Brett, a 138-unit apartment complex at 85th and Brett Ave. is also in the process of wrapping up construction. We purchased a 2-acre plot of land at 41st and Highway 100 for a future retail project that we are still working on the details of. We have a potentially large real estate purchase that will be a fun announcement to make in the third quarter if it comes to fruition as well.

Levitt at the Falls and MarketBeat Announce New Partnership

In May, Levitt at the Falls announced that MarketBeat will be the organization’s new Season-Presenting Sponsor for the next four years. Under the sponsorship agreement, MarketBeat will make a significant financial contribution to Levitt each year, and MarketBeat’s branding will be featured heavily during Levitt’s summer concert season. We are excited about this sponsorship because Levitt is a great asset for the city, bringing people downtown and bringing the community together. It also allows MarketBeat to financially support dozens of musical artists with a single sponsorship, and it gives MarketBeat great visibility in the community. You can read more about this year’s Levitt concert series here.

Huether Family Match Pointe to Host “MarketBeat Open” Professional Tennis Tournament

Also in May, Huether Family Match Pointe announced that it would be bringing the Associated Tennis Professionals Tour to South Dakota for the first time. MarketBeat is the tournament’s primary sponsor, which will be called the MarketBeat Open. The tournament is presented by USTA Northern and will take place from October 20th to the 27th at the Huether Family Match Pointe facility in Sioux Falls. We have several tennis players at MarketBeat and are excited about the visibility that this tournament will create for Sioux Falls in the broader tennis community. You can learn more about the MarketBeat Open here.

MarketBeat Open Logo

Additional Philanthropy Thoughts

This has been a busy quarter for our philanthropy committee. We received more than twenty applications from local non-profit organizations for funding and made contributions to twelve of them. This cycle has been informative to us because the number of applications really helped us understand what makes a good application and what would cause an application to no longer be considered. Consequently, we’re making a handful of changes to our giving criteria.

Here’s what we’re changing:

  1. We are limiting future gifts to organizations that operate in Eastern South Dakota. While there are many worthy causes worldwide, MarketBeat cannot be everything to everyone, and it is very difficult to monitor the effectiveness of a gift when the funds are sent overseas.
  2. We are providing better guidance to organizations that have not received a grant before. Every quarter, we receive one or two applications from new non-profits looking for six-figure gifts. We updated our information pages to note that organizations will get better results if they ask for a smaller gift and build a relationship with the company before asking for a bigger gift.
  3. We are requiring event sponsorship requests to apply further in advance. When organizations want us to sponsor an event that is one or two weeks after our application deadline, it simply does not give us enough time to promote the event, arrange marketing benefits, and get some of our team members lined up to attend.

Our philanthropy team has had six decision meetings now, and we get a little bit better at it every quarter. If you are involved with a non-profit doing interesting work in Sioux Falls, encourage them to apply for a grant from MarketBeat here. Our next application deadline is August 15th.

Wrap Up

If you are still reading at this point, I would encourage you to look at the concert schedule for the Levitt this summer. While we are already in July, there are still many great free concerts in downtown Sioux Falls that you can check out this month and next. Our team hopes to see you out on the lawn!

MarketBeat Team at The Levitt