Kansas City-based Five Elms Capital recently led a round of financing for an Omaha blog-hosting startup.
Five Elms led a $4 million round for Flywheel, allowing the startup to add features to its platform for designers and agencies, as well as beef up marketing and sales operations. Linseed Capital and the Nebraska Angels, a network of venture capitalists, also joined the round.
Five Elms was founded by Fred Coulson, who serves as its managing partner. Five Elms has invested in other area firms such as Kansas City-based United Medicare Advisors, Lenexa-based Smart Warehousing and Kansas City-based Spring Venture Group, of which Coulson is founder and chairman.
Five Elms focuses on investments of $3 to $30 million in business-to business firms with $2 to $20 million in revenue. The firm’s advisory board features Jeff Stowell, who is leading Kansas City’s new $25 million seed fund, Royal Street Ventures & Innovation Center.
Flywheel CEO Dusty Davidson said that he’s pleased with the partnership his company has struck with the Kansas City investment firm.
“We couldn’t ask for better partners than the team from Five Elms, who we’ve known for many years and are excited to work with side-by-side,” Davidson wrote in a blog post. “We’ve also got an amazing team of creative, passionate Flywheelers who are excited for what the future holds. And we’re just getting started transforming the hosting industry for the people who design and build the majority of the sites in the world: designers and agencies.”
Flywheel offers WordPress-based hosting services specifically targeting designers and creative agencies. The site allows users to create, launch and manage sites from a central location, helping to foster collaboration.
The Omaha World-Journal reports that Flywheel employs 35 people and expects to grow to a staff of 80 by the end of 2016, Davidson said. Founded in 2013, Flywheel now has more than 40,000 clients. The company raised about $1.2 million in 2014, which was led by Omaha-based Linseed Capital.
Davidson said that Flywheel was in a rare position for a startup in that it didn’t need the capital it just raised.
“We’ve got a large and growing customer base and cash in the bank,” he wrote. “With the seed round of funding from a year and a half ago, we were able to build a fast-growing and profitable business, and have established ourselves as one of the top players in the WordPress hosting market.”