It’s been two years since I started Capital Entrepreneurs, an organization to help Madison entrepreneurs connect. I’ve been blown away by how fast CE has grown and how quickly time has gone by. On our two year anniversary, here’s the story of how we got to where we are today.

In April 2009, I was a month short of gruduating from UW. I had just started my second company, Entrustet, with my business partner Jesse Davis. Many of our friends were taking jobs outside of Madison and the two of us were going to be staying in Madison to startup Entrustet. We both had been a part of the UW entrepreneur scene and had received support from other students, professors and the university itself, but since we were graduating, we were worried that we would not be able to take advantage of the support system any more.

I realized that most people make new friends after college via their job, but since Jesse and I were the only people in our company, I worried that we’d get isolated. I knew that there were other founders in town who were graduating who likely felt the same and wanted to do something make us more like coworkers, even though we were all working on separate businesses.

I’d been to most of the startup focused meetups and events around town and thought that there was a niche for a group that was specifically for founders that could compliment the existing networking events like High Tech Happy Hour and Madison Magnet. I wanted to create a place where founders could get to know each other, hang out and talk freely about their problems, dreams and goals, without having to worry about getting pitched by attorneys, insurance agents, accounts or the press. I wanted a place where ideas flowed freely and entrepreneurs would feel comfortable both asking for help. I wanted it to be free and without structure. I wanted Madison’s entrepreneurs to be a community of friends, not a disparate group of people who just happened to start companies.

At the end of April, I talked to a few of my entrepreneur friends and asked them what they thought. Everyone loved the idea, so I started to look for a venue that would give us a private space for free, along with some other enticement to get our business. Our friends at Brocach gave us a space in their upstairs bar, along with a nice food special and we set our first meeting. I invited all of my friends who met two simple rules. They were:

1. The founder or first employee of a Madison business
2. Were not a service provider like an attorney, accountant, insurance agent

Our first meeting was right before graudation in May 2009. Around 10 founders showed up. We introduced ourselves, had beers and talked. It was great. We decided to do a second meeting that next month. I quickly realized that Madison entrepreneurs were doing some amazing things, but that the rest of the community had no idea. So I started a website. It’s a simple blog that gets updates whenever a CE company gets press, sends out a press release or the city itself makes news. It also includes a list of member companies, resources for Madison’s startups, along with info on how to join.

Since May 2009, CE has grown slowly, but surely each month. The second meeting had 12 founders, the 4th 17. It just kept growing. One year later, CE had 34 member companies and 60 registered members. As we grew, service providers wanted to attend to meet the entrepreneurs. We decided service providers could sponsor CE and attend ONE meeting per year. At that meeting, they are not allowed to sell their services, just answer questions and get to know the entrepreneurs. They also have to pay for our bar tab.

We were lucky enough that Neider and Boucher, Michael Best, Boardman Law Firm, Marquette Golden Angels and Venture Investors agreed to be our first sponsors. Sponsorship worked out great for CE and the sponsors. It was a great way for entrepreneurs to get to know service providers and for the service providers to get to know us. It was also a great way to attract new, high growth clients.

CE continued to grow, but I was a little worried when Jesse and I got selected for the Startup Chile program. Forrest Woolworth stepped up and ran CE while I was gone and did an amazing job. Over the last year and especially in the last six months, CE has started to take off. We now have over 75 member companies and 120 people on the email list. We’ve been featured in Techcrunch, Read Write Web, Madison Magazine and tons of other publications.

Member companies have been featured in the NY Times, The Economist, Financial Times, Wall Street Journal, Techcrunch, Mashabale, Forbes, BBC and hundreds of other influential blogs, newspapers and magazines. CE companies have created over 300 full and part time jobs during one of the worst economies in recent history. We’ve raise over $15m in funding. Spinback, founded by CE alumni Andrew Ferenci and Corey Capasso, was acquired. Spill, founded by CE alum Heidi Allstop was selected for Techstars. My company, Entrustet, was selected for Startup Chile. CE members have been instrumental in helping start the Forward Technology Conference, Build Madison and other entrepreneurship initiatives in Madison.

Madison’s startup scene has grown significantly in the past few years and I’m excited and proud that CE has been a part of it. I can’t wait to see what the Madison startup scene looks like in another year! I’d like to thank everyone who’s helped make Capital Entrepreneurs what it is today. It would never have been a success without all of your help!

It’s great to see Wisconsin entrepreneurs finding success both inside and outside of Wisconsin and even better to see some of the original CE members finding success!

This is Capasso’s second successful exit.  Previously, he was part of ExchangeHut, a Madison, WI company that was acquired in 2008.

From Mashable:

Facebook management platform Buddy Media has acquired Spinback, a social commerce and analytics platform that launched in October 2010.

“Thousands of websites have social sharing functionality, but they don’t understand how this sharing affects their business in terms of direct sales, indirect sales, conversion metrics,” says Michael Lazerow, CEO of Buddy Media. “With this acquisition, Buddy Media can now answer the question ‘what is the ROI of social media?’ better than anyone else in the market in a holistic way, both on Facebook and off, and on Twitter and email.”

Spinback has more than 20 clients, and its EasyShare social plugin allows consumers to easily share products and purchases via Facebook, Twitter and email. Lazerow says Spinback provides an “elegant” way to analyze all the sharing on a website and explain how it affects a company’s bottom line, especially because 90% of purchasing decisions are subject to social influence.

But if Murfie—or any of the other sixty-some startups that meet monthly under the Capital Entrepreneurs banner—are going to survive and create jobs and prosperity for our region, many of us must think and act a little differently.

Forbes declared Madison the 7th most innovative city in the country, ReadWriteWeb recognized Madison as a technology startup hub in its Never Mind the Valley Series, and TechCrunch declared Madison the Land of Beer, Cheese, and… Startups. Over the course of 2010, Madison startups raised over $62 million in funding. This funding was led by Virent, Shoutlet, Networked Insights, and PerBlue. Madison startups hired 73 full time employees this year, and now employ over 250 people.

Capital Entrepreneurs organized and hosted the first annual Forward Technology Conference. With a vision to be the SXSW of the Midwest, the inaugural Forward Technology Conference proved to be very successful, attracted an overflowing audience, and will definitely be back and better than ever next year. Capital Entrepreneurs also played a key role in organizing Madison’s official application for Google Fiber. The entire city got behind the Google Fiber effort, and the “MadFiber Cabal” (made up of CE members) was at the organizational forefront. There was even a custom MadFiber ice cream flavor created by Babock Dairy.

Capital Entrepreneurs companies had a very successful year overall. There are now over 60 CE member companies, up from 10 when the group formed in mid 2009. Throughout the year, companies received a lot of attention and were featured in the New York Times, TechCrunch, Mashable, Forbes, VentureBeat, ReadWriteWeb, numerous local publications, and many more.

Madison welcomed its first hackerspace with the opening of Sector 67. Asthmapolis won the Twilio and Union Square Ventures contest. PerBlue’s Parallel Kingdom launched its newest version, the Age of Thrones, and now has over 275,000 players worldwide. Entrustet was selected as one of only 25 startups from around the world to participate in Startup Chile. Hardin Design and Development’s apps were featured on Apple commercials and received numerous awards. Murfie launched its beta service to revolutionize the way you buy and sell music. Student SPILL expanded to an additional 10 college campuses. BrazenCareerist opened a new office in Washington, DC. UlluTek pitched at the WI Early Stage Symposium. HealthFinch and GoBuzz were selected to pitch for Paul Graham’s Y Combinator. And Flatt Cola helped all of us achieve everyday world domination.

All in all, 2010 was a great year for Madison startups. Based on the momentum of this year, 2011 will prove to be a very exciting time for the Madison startup scene. So if you’ve got that entrepreneurial itch and are thinking of doing a startup, Madison is a great place to do it. Be sure to keep an eye on the CE website for the latest updates from Madison startups.

Contributed by Forrest Woolworth of PerBlue.

“A lot of the people in high-tech and creative industries really want urban settings,” says Cieslewicz. “With the Capitol East District we can offer them what they want, so they’ll develop all their amazing entrepreneurial ideas here rather than in Palo Alto or Ann Arbor or Boston.”

And what they want, according to Cieslewicz and others working hard to bring Capitol East to life, is to be where it’s all happening, both at work and at play.

“All of the startups I’ve been talking to want to be located downtown, within walking distance of other startups,” says Nate Lustig. “It’s really important to us to have that cluster of high-tech new businesses sharing ideas, people and all kinds of resources.”

Along with Steve Faulkner’s post on TechCrunch last month, Madison is really starting to get on the map as a startup hub in the midwest.  From the link:

Since early 2009, Capital Entrepreneurs has held a monthly meet-up for entrepreneurs. With over 60 member companies, the group has helped bring the Madison entrepreneur community together. The group also has its own Capital Entrepreneurs Angel List, based off of a similar program out of Venture Hacks.

Based off a successful program at MIT, Merlin Mentors pairs new startups with successful business people in the community, who act as mentors and as an informal board of advisors. Merlin (short for Madison Entrepreneur Resource, Learning and Innovation Network) Mentors was developed with the support of various programs at the University of Wisconsin-Madison.

Most people associate Wisconsin with cheese and beer, but you should think about adding startups to that list. Led by a tidal wave of mostly young entrepreneurs, Madison, Wisconsin is staking a claim as the startup capital of the Midwest. Madison was recently ranked as the 7th most innovative city in the country by Forbes magazine – just above perennial powerhouse Boston, MA.

Several key organizations are driving the growing startup community. Capital Entrepreneurs is a group of over 56 companies that meet on a regular basis to help founders network and develop connections. MERLIN Mentors provides free mentoring services to new startups. Applicants are assigned a team of experienced entrepreneurs who help founders navigate many of the challenges facing a new company. These groups, along with the University of Wisconsin, are fostering a great culture for new startups.

From the Lifehacker article titled Entrustet Secures your Accounts After Death with Legal Backing:

Entrustet offers a free account that lets you set up unlimited password-protected accounts to be transferred over to a trust person upon your passing. How does it know when you’re gone? You assign a trusted person to be your Digital Executor, who will notify Entrustet and then provide a death certificate scan to activate the password conveyance upon your death. You can also assign your estate attorney to execute your Entrustet transfer upon your death, and the site offers up a few attorneys officially on board with Entrustet—though we imagine any savvy attorney can be conscripted for the duty. Additional security and ease-of-use features (for the executor and recipients, at least) are included with paid plans.

You can check out the Fox Business Live interview below: