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Stephen Dinehart of MoolaPitch supports using crowdfunding, saying companies should avail themselves of all the tools available.

Invest a few hundred (or thousand, if that’s your game) dollars in a startup through a crowdfunding site, see a return. Take that return, survey more investment options. Repeat.

That’s the idea behind a Wisconsin startup, MoolaPitch, helmed by a former investment banker.

MoolaPitch, currently in a beta testing phase, is a crowdfunding site designed to help Wisconsin entrepreneurs raise money from fellow Wisconsinites. Due to legal regulations, the company only operates within state lines, a sort of “buy local” opportunity for the entrepreneurial fundraising community.

The site is designed to offer entrepreneurs a funding option beyond traditional angel investor networks.

“I think a lot of folks have been lulled by the success of angel networks in this state,” said Stephen Dinehart, president of MoolaPitch, who spoke at Madison’s entrepreneurship meetup, 1 Million Cups, on Wednesday. “But, the thing is, if you’re an entrepreneur and want to raise money, an angel group may invest in one in 100 deals — what you really need to do is get out there and use all the tools that are available to you.”

Dinehart references a recent high-profile business funding snafu as an empowerment of his business model.

In 2013, about 9,500 people donated $2.4 million via Kickstarter, a crowdfunding site, to a virtual reality company called Oculus. Last year, the company was acquired by Facebook for $2 billion, leaving “investors” from the crowdfunding site feeling rather miffed.

As The Huffington Post reported at the time, Kickstarter investers were “pissed” and learned “one of life’s important lessons the hard way: The little guys rarely win.”

Though Dinehart said the Oculus drama didn’t inspire the creation of MoolaPitch — years of working in investment did that — he considers the experience a reason for investors to step outside of the Kickstarter space and into a relationship that involves possible return on investment.

However, investors haven’t been the hard sell as of yet — it’s businesses that have been shy to get on board with a non-angel-focused model.

“It’s cost,” Dinehart said of startups’ hesitancy. Early stage companies may need to spend tens of thousands of dollars in legal fees for non-angel investments, he explained.

Dinehart said MoolaPitch is on track to launch early next year. He already has five companies lined up to go live at that point, representing a swath of industry, from consumer products to business-to-business services.

He says he’s optimistic about the ability of Wisconsin’s startup culture to provide him with enough business to stay afloat (MoolaPitch makes money by charging user fees).

“Wisconsin is not a small state and has a strong spirit of entrepreneurship,” Dinehart said. “There’s more than enough businesses to get into in the state of Wisconsin.”