Sean Conway addresses the crowd at IdeaFunding 2013.

Courtesy of Edgeton Photography

Selling your startup company to investors is a lot like dating, says Sean Conway, a University of Arizona alumnus who founded the class-notes sharing website Notehall and sold it in a deal worth $9.5 million in 2011.

You have to have something attractive to offer, be confident — and a little hard to get, Conway said in the keynote speech Thursday at IdeaFunding, an annual Tucson event that teaches entrepreneurs how to hook up with investors.

Conway, who graduated from the UA Eller College of Management’s Maguire Entrepreneurship Program in 2008, co-founded the company in 2008 with fellow UA alumni Justin Miller, Fadi Chalfoun and D.J. Stephan. Within eight months, 40 percent of UA students were buying and selling class notes on the website. Conway and Stephan appeared on the ABC reality show “Shark Tank” in 2009, winning an investment offer the founders later turned down to join a Philadelphia business-incubation program.

In 2011, Notehall was acquired by the textbook-rental company Chegg Inc. for $9.5 million in cash and stock, according to regulatory filings.

The relatively quick, three-year trip from idea to acquisition has been viewed as something of an “instant success,” Conway told more than 200 IdeaFunding attendees Thursday at the Tucson Marriott University Park hotel.

“It actually was far from it — we were on a roller coaster ride,” said Conway.

He recalled one of his first attempts at raising money for Notehall, when he went down the list of major donors to the UA Alumni Association and called them one by one.

“I got a lot of hang-ups, a lot of friendly advice and two meetings — but no money,” he said.

Unable to find financial backing in Tucson, Notehall wound up taking an offer from DreamIt, a Philadephia-based high-tech business incubator.

By the time Notehall was attracting interest from Chegg, Conway said he knew how to play it cool. He recalled how he was floored by his first sight of Chegg’s lavish offices in Santa Clara, Calif., which featured penthouse offices and perks like video games and sushi lunches for employees.

“So what did I do? I acted like I wasn’t impressed,” said Conway, who later casually mentioned that he was expecting to get to 350,000 Notehall users that month. At the next meeting, he told Chegg executives the company didn’t get to 350,000 — it reached 400,000.

The deal was still far from done, but Chegg was hooked, Conway said, continuing the dating analogy.

“Asking about the business is probably first base, asking about the numbers is second, and if they ask you how much you think your company’s worth, they better have the ring in their pocket,” Conway said to a round of laughter.

And if looking desperate in person is bad, looking desperate on paper is even worse, he said.

Gathering good metrics — measures like sales projections based on strong data — also is key to winning investment funding, Conway said, adding that he used skills in creating so-called pro forma financial projections he learned at Maguire.

“When you don’t want money is when they’re willing to give it to you,” Conway said.

Beyond funding, assembling a great team is key, Conway said, advising the entrepreneurs to “hire the hungry.”

“I look for people who are young and hungry, and people I can have a beer with,” he said.

Conway said things just didn’t work out in Tucson, but the city has a strong entrepreneurial spirit and a growing support system for startups.

“Although we wanted to stay in Tucson, we just couldn’t find the money, but I think Tucson is a great place to start a business,” he said.

Larry Hecker, a longtime member of the local Desert Angels investment group and a founder of IdeaFunding, said new entrepreneurship support groups like Startup Tucson and the UA’s new technology-commercialization initiative, Tech Launch Arizona, are meant to ensure that opportunities like Notehall don’t leave town.

“Today, Notehall wouldn’t get away,” said Hecker, who has helped lead efforts to boost entrepreneurship at Tucson Regional Economic Opportunities Inc. and other local economic-development groups.


Also at IdeaFunding, UA President Ann Weaver Hart was given the Thomas R. Brown Entrepreneurship Award. The honor is named for the late founder of Burr-Brown Corp., who started the company in his Tucson garage and sold it to Texas Instruments in 2000 in a stock deal valued at $7.6 billion.

Sarah Brown Smallhouse, Brown’s daughter, said Hart deserved the award for making technology commercialization a major priority at the UA with the cabinet-level Tech Launch Arizona initiative.

Hart said the UA is looking to boost business creation for the benefit of the region.

“The university is a powerhouse of science and technology, yet we’ve been pretty ordinary about what we’ve been able to leverage out of that,” Hart said. “It’s been raised to the highest level of importance, and the significance of that resonates throughout the entire community.”

Contact Assistant Business Editor David Wichner at 573-4181 or