In the world of entrepreneurship, few are pushing innovation, technology, and for-profit entrepreneurs forward to the degree that Nick Edwards and Jeff McDermott are via their nonprofit. We had the privilege of having a conversation with Edwards, co-founder of BisonX, an evergreen nonprofit startup studio that officially launched on January 1. Edwards, a trailblazer in his own right, has embarked on a mission to redefine the landscape of social impact through sustainable and groundbreaking capital ventures alongside McDermott. Our Q&A session with Edwards sheds light on the driving forces, mentors, and aspirations that have fueled the remarkable journey of BisonX, making it a socially conscious enterprise that’s here to help.
About Nick Edwards
Nick Edwards is a nationally renowned physiologist and has built multiple medical programs for a wide range of populations that are currently running across the US. In his career, he has also worked with organizations from NHL to NFL, Men’s and Women’s Division I NCAA Teams, podium Olympians, and World Champions, and he still currently serves as team physiologist for four professional teams. Nick himself was also a collegiate and professional athlete and has a drive to give back to the entrepreneurial community.
Beyond athletics, Nick has worked in both the private sector and clinical settings, launching startups and fostering early-stage ventures. While his sweet spot is in health tech, Nick has been part of multiple startups, SPVs, has served as a general partner and limited partner, and worked in companies from launch, through fundraising, and on to exit. His philosophy lies in unlocking and harnessing each person’s unique motivation, and in turn, helping them find solutions and open doors for their successful ventures.
A Q&A with Nick Edwards
Executive Director and CO-General Partner (GP) of BisonX
Q: Tell me a bit about yourself.
A: Im currently living in Denver, but I originally went to school at NDSU in Fargo. I stay down in Denver during the winter and come up to Detroit Lakes for the summer, so it’s a good balance. I moved to Denver to get out of the cold and go somewhere else. After leaving NDSU, I was fortunate enough to become a team physiologist and sports scientist for NFL, NHL, and NBA teams. While I was there, I had the opportunity to experience all the cool technology, and I thought, ‘Wow, nobody knows about this. It’s unbelievable.’ So, when I discovered that, I began researching companies that were essentially bringing those ideas to the general public. I thought, ‘Oh my gosh, I’m a sports scientist working with these pro teams. How can I help share this with everyone else?’
As a result, I naturally transitioned into learning about what early-stage entrepreneurs were going through and understanding the challenges they were facing at that time, and where I could contribute to assisting them. As I went through the entire cycle of a company’s life and its scale and my exit, I realized that people needed more guidance in navigating this process. So, I launched my own venture, experienced the same cycle of growth, success, and even decline, and ultimately decided, ‘Alright, it’s time for me to take this to the next level,’ and now I’m focused on helping other companies achieve the same. That’s when I shifted more towards the formation and scaling side of VC (venture capital).
I pursued the path of commercializing this technology, and I’ve worked on a few different startups since then. I’ve had wildly different experiences between one going bankrupt, and the others being successful exits. After those experiences, I thought that it was cool to be on this side of tech. I slowly worked my way to becoming a partner in an incubator, worked in IP commercialization, and was a partner in venture capital. I’ve worked with groups in Silicon Valley, Atlanta, and Nashville, all of which are very prolific startup areas. I was curious about what was going on with the startups back home in Fargo and was shocked to see that we had close to none until the last year or two.
My now-partner, Jeff, and I were brainstorming how we could bring more capital into the region We talked to a bunch of limited partners and explained that this would be a great area to invest in, but nobody was interested since not much was coming out of the area. Jeff and I essentially said that if no one else is going to do it, then we will. We formed BisonX, a nonprofit startup studio that covers everything from the initial stages to venture capital. I believe that we’re the largest venture capital firm in terms of private capital from North Dakota. We are the largest startup studio and the only nonprofit startup studio in a five-state region. Moreover, I believe we’re one of the largest nonprofit VC firms, with for-profit funds alongside it, in the United States as a whole.
About Jeff McDermott, Advisor and Co-GP
Jeff is a serial entrepreneur and widely renowned Venture Builder. For the past 20 years, he has worked alongside founders with products and services, hired teams, aided in funding, and continues to provide resources and guidance across the company lifecycle—even through proven successful exits. Jeff loves starting companies, driving the vision and progression through validation, and developing innovative revenue streams and solutions.
How It Works
Entrepreneurs join one of their cohorts, as part of BisonX. They collaborate with existing North Dakota accelerators, incubators, and models to ensure a solid path to Product Market Fit, prioritizing tangible growth over mere knowledge and capital infusion.
Q: Why did you decide to return to the Fargo-Moorhead area specifically?
A: I returned for two distinct reasons. Firstly, just because there aren’t a lot of VC-backable companies doesn’t mean that the ideas aren’t there. The market has been saturated with aspiring dreams and concepts, constrained by limited time and resources due to existing commitments like full-time farming or other careers and for-profit entrepreneurs with busy schedules and lifestyles.
Secondly, my motivation stems from the source of my accomplishments and experiences that have taken place here. Faculty members, coaches, and individuals at NDSU have facilitated significant opportunities for me. This connection has instilled a desire to contribute back to this locality. Since my involvement in the startup realm and aiding corporate expansion, I thought, ‘What better way to foster growth than by simultaneously nurturing Fargo’s progress?’
Q: Tell me a bit about the advisors, mentors, and coaches that you work with.
A: We’ve brought in mentors from various backgrounds. Jeff and I, having experience in Silicon Valley, Atlanta, and national markets, have been able to attract some of the best minds to lead venture capital firms and serve as mentors. For instance, one of our most prominent mentors owns a venture capital firm based in Atlanta. So, not only do our mentors offer expertise locally, but we also have a direct connection to other VCs beyond our own network. Our approach involves identifying accomplished professionals on a national scale and inviting them to join us, but the most important aspect to understand about our mentors is that they essentially hold the company’s playbook; it’s their guiding principle.
Throughout our structured curriculum, we’re collaboratively crafting a playbook of success and operational strategies. The mentors’ role primarily revolves around ensuring that founders adhere to this playbook. For instance, if you were to discover three new leads for your company in a day, my response would be, ‘That’s great! Are any of these leads from a market that currently generates no revenue?’ I would encourage you to shift your focus back to the plan and remind you to stay on track. Essentially, the mentors are there to help you stay aligned with the course and avoid getting distracted by fleeting opportunities.
Q: What’s the biggest issue at hand for BisonX currently?
A: There’s a severe lack of VC-ready companies in our area. We’re here to be a venture capital firm and start-up studio that helps everyone as much as we can, whether it’s a mom-and-pop organization that doesn’t really fit in that area and doesn’t want another mortgage if they don’t have the cash to bootstrap it or anyone who may not have the knowledge to succeed. In short, we’re a VC firm for all cash-flowing businesses, not just the unicorns of our landscape.
We’re excited that close to 50% of the companies that we’re investing in and working with are female-led and founded, which is very rare in North Dakota to be tapping into this focus of female-founded companies. It’s significant to have that in this industry.”
Nick Edwards, Executive Director, and Co-GP
Q: You mentioned mom-and-pop shops. Do you work with all types of businesses or what’s your primary focus?
A: Not to take a stance on a soapbox, but I’d say about 97% of companies aren’t ready for venture capital. In fact, most for-profit VC firms rely on only 1 in 10 businesses to fully fund their operations. Considering that 90% of startups fail, those odds aren’t favorable. We aim to generate more jobs through more companies. Yes, we will identify some scalable unicorns, but it’s not our aim.
For instance, let’s consider someone who owns a local boutique shop; it’s likely not a suitable fit for us. However, if someone approaches us with a plan to partner with boutique shops and digitize their presence across all rural states, that’s what we’re seeking. We’re looking for individuals who think in terms of scale, lack the funds or capacity for financing, or simply need some additional guidance and support. Therefore, we’re open to exploring any company’s preliminary idea for scaling and determining the best way to move forward.
Did You Know?
BisonX’s scope encompasses a five-state region: Minnesota, North Dakota, South Dakota, Montana, and Wyoming. While they invest in this entire area, Fargo serves as their central hub, with their primary focus and investments rooted here.
Q: What is the vetting process like for enrolling companies in your program?
A: Our vetting process begins with an application. Our aim is to identify exceptional individuals and teams with the potential for substantial growth. We seek those who set their sights on ambitious goals, while also possessing the knowledge of foundational steps required for progress. The alignment of the founder’s qualities is crucial. In the early stages of a company, the ability to elevate a venture significantly is vital. With countless ideas swirling, we meticulously distinguish between mere pipe dreams and ideas deemed realistic and viable. Balancing ambition with a pragmatic approach is key, and our model excels in candidly addressing ideas that may not be feasible. We elucidate the three distinct company stages we recognize.
First is the realm of small businesses, including boutique shops and passion projects. For such cases, we often advise exploring options via the SBA, accessible through the Bank of North Dakota or nd.gov. The second stage involves companies primed for VC investment, positioned as plausible investment opportunities. While achieving unicorn status might not be the goal, progress in business remains viable. The third stage is VC-backed, yielding extensive scalability and returns. Although few reach this pinnacle, it’s not essential to possess massive-scale attributes to succeed. Our role lies in guiding individuals toward their optimal path, helping them progress, getting cash flow, and potentially attracting investments in the next phase if that’s even needed.
Q: Why choose the direction of a nonprofit model?
A: It makes us a lot more flexible, allowing us to collaborate with universities and early-stage companies. Limited partners, who are essentially investors for a VC firm, play a significant role in this flexibility. These limited partners expect a return on their investments. In a VC firm, there is a lesser-known reality: limited partners form the investor base for the fund. For instance, in a $50 million fund, limited partners contribute this, while the general partner also contributes capital. The role of the general partner, who is a fiduciary, entails ensuring that the fund generates returns for the limited partners.
Beneath the general partner, there are venture scouts who source potential deals and present them to the general partner for approval. This structure underscores the fact that the primary objective of a venture capital firm is not just to churn out numerous companies, but rather to identify and invest in early-stage companies with high growth potential, thereby generating returns for the partners. This is the fundamental purpose of a VC company.
However, our approach is a bit different. As we structured ourselves as a nonprofit, we refer to our participants as community leaders rather than investors; they are donors and community partners. Our overarching goal revolves around driving economic growth. As such, our main focus is twofold: fostering the growth of more companies and generating returns, all while promoting economic expansion.
Q: What are the downsides to that model?
A: The downside is that you need to have a sufficiently strong presence and voice to persuade donors and business leaders to believe in your cause. Fortunately, however, we’ve been able to have supportive donors around us, and when combined with our track record and bolt-on for-profit funds, we’ve shown our ability to strategically utilize donor funds, make purchases, and attract additional funding, which has allowed us to leverage our initial capital effectively.
By The Numbers
- 4 Portfolio Cohort Companies
- 1 Company Acquired
- 2 Companies Invested In
- Currently, Portfolio of Assets Pushes $60 Million
… All Within 8 Months of Operation!
The Bisonx Process
In their unique approach, they collaborate closely with aspiring entrepreneurs, guiding them through our comprehensive program. Upon successful program completion, participants earn a $50,000 grant across milestones.
What sets BisonX apart is its dual-pronged support system. Its alliance with venture capital firms adds a dynamic layer. This entails tailormade arrangements encompassing equity, debt, or innovative hybrids. The intriguing twist is BisonX’s nonprofit status, with community leaders and donors providing a significant push forward.
This teamwork has led to a constantly repeating process. New startups consistently join the startup studio, creating innovative paths driven by generous funding. Additionally, their careful $50,000 investments sow the beginnings of significant profits. Then, BisonX invests in that company, and then studio fees, profits, and distributions go right back into the startup studio as the next round of grants.
Q: How long do these cohorts last?
A: They are self-guided and could run for a minimum of six weeks, or continue until completion. Our main focus is ensuring that they possess all the necessary elements for achieving product-market fit or, frankly, they fail early and learn from it. This essentially means: Can you successfully sell it? Have you met the market demand? And can you scale this into a sustainable business, rather than struggling and failing? In the startup studio model, achieving unicorn status is less probable compared to a VC firm. However, the likelihood of establishing profitable businesses is significantly higher. A VC firm considers fewer than 10% of businesses as profitable, with 90% ultimately failing. In contrast, the startup studio model witnesses over 60% achieving profitability, and there’s even a possibility of 5% reaching unicorn status. Hence, the emphasis is more on launching multiple companies rather than seeking the isolated success you may desire.
Q: Could you walk me through what it’s like for someone to go through the startup studio?
A: When someone comes in, they submit an application. After the application process, we guide them through a structured curriculum both in-person and through virtual meetings. We have mentors who assist them along the way, as well as myself and my partner, Jeff. We are deeply involved in guiding the company during significant turning points. In each of the call modules within the cohort, we cover aspects such as visionaries and operators, and the type of founder you are. For instance, are you someone who can talk the talk, but needs operational expertise? Do you need help recruiting the right staff to support you? We also address topics like legally forming a business, staffing, scaling financials, pitch decks, and how to present your idea to potential investors. This process continues through achieving product-market fit and guiding them to successful sales.
One of the most distinctive features of our program is that within the first week, right after we tackle the visionary or operator aspects, we assign them a task, such as setting up a splash page website. They are then tasked with recruiting individuals to act as beta testers and provide feedback on the idea. This creates a natural pipeline of potential customers by the time they graduate. For instance, if you take your idea to 200 people and receive feedback, you can refine your model. At the end of this refinement, you return to the same group of people and ask them if they would purchase the product. If we achieve a 60% to 80% positive response rate, that’s great, and we continue forward. If the response rate is lower, we go back to the drawing board and pivot.
Ultimately, our goal is to find the right product-market fit and guide them through the process. We take a big stake by co-founding it with them and are with them every step of the way, not like a one-off program, as we want to get them into an opportunity state and see them succeed more than they ever imagined.
We’ve really aimed to take on the responsibility of being a VC group for everyone. Most companies aren’t VC-ready; in fact, 97% of companies aren’t VCbackable. That’s where we come in. If someone wants to open up restaurant #5, we have their back. A brand new real estate professional needs help to scale? We will back them! We aren’t solely seeking the unicorns of their industries; our aim is to contribute to the economy with scalable, cashflowing businesses.”
Nick Edwards Executive Director, and Co-GP
Q: Do you currently have any other projects going on?
A: Everything I’m currently engaged in either involves BisonX or my med-tech company, Loop. The latter is originally based in Denver, but we’re relocating our headquarters to Fargo. Like my other projects, I’m currently spinning off into more sports medicine companies by conducting physiology with teams. I’ve been designing protocols for kids transitioning through juniors and advancing in hockey, focusing on what they need to do metabolically to prepare for being on the ice. Currently, through BisonX, we are forming a medical management company that gives everyone an opportunity to have a voice in their care and scale from our five-state region to a nationwide reach.
About Loop
Loop is an on-demand platform that improves the patient experience, drives outcomes, and delivers a stream of passive revenue to brick-and-mortar clinics. Loop’s SaaS platform operates alongside established practices as an extension of their care.
Learn more
clinics.loopcare.io
(701) 929-4277
[email protected]
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