Froehlich, group invest in companies, region

By Alica P. Thiele apthiele@argusleader.com

PUBLISHED: October 5, 2007 - Argusleader

Dale Froehlich grew up on a farm, planting seeds and cultivating the fruits of his labor. He still enjoys helping things grow and, as president of Prairie Winds Capital, he helps invest in start-up companies.

Froehlich and other investors formed Prairie Winds in 2006. It is one of 24 investment fund members of Regional Angel Investment Network.

QUESTION: How does the fund work?

ANSWER: People who have fledgling companies make applications online at www.prairiewindscapital.com or in person. Then we evaluate each enterprise, each idea, and we vote up or down whether or not we want to get involved.

Q: How many investors make up Prairie Winds?

A: We have 14 members. I view our role as sort of like a gardener, looking for the right seed to plant in the garden, make sure it gets a good start.

Q: How many applicants do you get?

A: I'd say each month we're probably looking at three to five. In the first year, we only invested in four companies. One is ag related and has to do with grain transportation, railcars. The second one is technology, software. And the other two have to do with medical devices, medical research.

Q: Are most of your choices a sure thing?

A: We know that most of them are not going to be profitable. If we invest in 10 enterprises, we think that three or four are not going to make it, three or four are going to be marginal and only one or two are going to be relatively successful. Sometimes we pass on an application not because (it's a bad plan) but because it's not local, or it's not really helping the Sioux Empire community.

Q: Why are you involved?

A: The beauty of it is entrepreneurs create companies, and companies create jobs, jobs support families, and families then are able to grow and prosper and they need services. It's a fairly simple formula, but it starts with the entrepreneur. And because when I was in my 40s, people did this for me, so this is a way for me to pay back.

Q: Does this fund help keep young people in South Dakota?

A: I think what's happening today is that we're starting to see a fairly significant return of the younger folks coming back to places like Sioux Falls. There's a lot of focus on (research and technology) in our business community, and in our ag and our medical community right now. There's a lot of nice things coming together for the future of this area.

Q: What are the advantages of being in the RAIN network?

A: If the deal is bigger than we can do, then we can go to our sister RAIN funds. If I found a deal that had to do with veterinary science, I could find veterinarians in the network. We get not only the benefit of mutual financial support but also mutual knowledge.

Q: What started your interest in flight?

A: When I was on the farm, I would see planes going overhead. I did always kind of marvel at flight. It's just a magical thing to be able to fly.

Q: Do you fly?

A: I have a private license, instrument rated.