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Citing tax credits, Nebraska Angels tab Kansas co. for latest investment

The Nebraska Angels, a consortium of individual angel investors, have made their first substantial investment in a non-Nebraska company. Yesterday, the group announced its participation alongside Kansas and California investment groups in a $1.8 million investment in Nitride Solutions, a Wichita, Kan.-based tech company. Though terms of the deal were not disclosed, Nebraska Angels board member Jay Wilkinson told us in an email interview that the Nebraska Angel’s investment was a substantial portion of the total.

Founded in 2009, Nitride Solutions will produce substrates that are used to build electronics such as DVD players, TVs, and other LED products. The product will help manufacturers lower their costs while increasing the efficiency of power systems in hybrid vehicles, improving consumer and industrial lighting, sharpening color on flat-screen TVs, and enhancing air and water purifiers. According to a press release, Nitride will use the funding to begin manufacturing and sales by the end of 2011.

“Nitride Solutions’ novel method of creating substrates will change the market,” Karen Linder, co-deal lead for Nebraska Angels, said in the release. “The technology is revolutionary, and the leadership team has the commercial experience and the scientific skills that will make the company successful.” (Worth noting: Nitride’s founder, Jeremy Jones, was PIPELINE‘s 2010 “Innovator of the Year.”)

Along with Linder, Nebraska Angels president John Brasch participated in the deal. “This was our first instance of investing with our peers from Kansas angel groups,” Brasch said in the release. “We look forward to their co-investing with us in future Nebraska-based startup company opportunities.” Per Nebraska Angels policy, other participants in the deal were not listed.

Formed in 2006, the Nebraska Angels provide seed and early-stage capital in the range of $150K-$750K. According to the Nebraska Angels website, this is the eighth company the group has funded.

To learn more about the Nebraska Angels, visit nebraskaangels.org or see our 2009 feature on the Angels, “SPN interviews Jay Wilkinson of Nebraska Angels“.

Angel Tax Credits

In the release, Wilkinson (left, photo from twitter.com/jaywilk) indicated that the investment was made more attractive by the Kansas angel tax credit program. “Fortunately, a similar tax credit will become available in Nebraska in the fall of 2011,” Wilkinson said. “We expect the new legislation to spur investment opportunities in Nebraska.”

In an email interview today, we asked Wilkinson if the Nebraska Angels had already begun talks with startups in Nebraska in anticipation of the credit. “There are several companies presenting to the Angels in the next few months who we feel would be great candidates for the Angel tax credits,” Wilkinson said. “We expect it to have a substantial impact on Angel investing activities and to help expand the size of our organization.”

To learn more about the tax credits, see our post: “Legislators OK Angel Investment Tax Credit, other startup incentives“.