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Smart capital Venture capital investment goes beyond simple mentorship

Pierre Martell needs more than capital to expand his high-tech home building company beyond Moncton and into New Brunswick's two other large markets.

The president and co-founder of Martell Home Builders - who has gained a competitive edge in his field by incorporating technology on the job site and social media tools in his dealings with customers - said he needs high-level insight from advisors to move his company into Saint John and Fredericton.

Since the entrepreneur launched his firm in 2006, securing capital has so far not been a problem, because 70 per cent of his customers pay up front for their homes.

"We've come up with a strategy to raise the capital as we need it, secured against the builds," Martell said.

But guidance from seasoned veterans could be invaluable, he said.

"Somebody who's been there, done that, learned from the mistakes, adjusted and become successful, especially in a certain industry, can definitely add value," Martell said.

"They know what it looks like from the top looking down, so when we're on the bottom growing up, they know what the next step is."

Martell has won a spot to pitch his company's business concept on the CBC's Dragons' Den, where he will try to convince the show's millionaire investor-panelists - dubbed dragons - to hand him $500,000 to expand for a 20-per-cent stake in the company.

Martell made it through the first round of auditions in Moncton and if his pitch in Toronto on May 24 is entertaining enough, he will be able to watch himself on TV.

He hopes a deal with the show's dragons will mean accessing their wealth of knowledge.

If the pitch fails, Martell will continue to seek out guidance to achieve his ultimate long-term expansion goal - creating a national home building brand.

"Being associated with the dragons is a lot more valuable to us than the actual money," he said.

"If it doesn't work out with the dragons, I am assembling, hopefully, a big-name advisory board."

Martell started Martell Home Builders with his brother, Dan Martell, a well-known technology entrepreneur from New Brunswick who has since taken a step back but provides technology solutions through his company Spheric Technologies Inc.

The firm's brand is built, in part, around its website - www.themartellexperience.com - where a client can access an individual page on his or her home building project with photos of ongoing work and alerts about deadlines for decisions.

Martell's staff use iPhone 3Gs by Apple Inc. (NASDAQ:AAPL) to document home construction and communicate with one another.

And the entrepreneur posts updates about his company on Twitter and has a Facebook page while construction pictures are posted on a sharing site called Smugmug.com.

With just two other full-time employees and another 120 employed indirectly through sub-contractors, Martell Home Builders managed to double sales in 2008 over the previous year.

Gerry Pond, chairman of Saint John's Mariner Partners Inc. and a key player in technology industry association PropelICT, said Martell is looking for what's commonly termed "smart capital" to help his company grow.

A venture capital investment goes beyond simple mentorship, Pond said.

"Smart capital involves ideas, mentoring and introduction to new networks of people," Pond said.

"In addition to having capital, they (investors) would be looking at helping the company grow by opening up markets and introducing ideas to the business."