Venture Capitalists urged to invest in local start-ups
Date: Wed, 2000-02-16
By: Reed Williams Daily Progress Staff Writer February 16, 2000 Last year, Charlottesville-area businesses received a total of $60 million in private equity investments from venture capitalists. Yet that money is not coming from local investors. The reason: Local investors do not appreciate the fundamental potential driving technology start-up companies, yet string entrepreneurs along with their neighborly politeness. This was the message David Martin hammered home Tuesday morning during the Charlottesville Venture Group’s annual membership meeting at the Comdial Corp. conference center. “One of the things we need to do better is to stop pretending to be polite and start being reasonable,” Martin, chairman of the group and president of M·CAM, told an audience of several dozen people, including group members, entrepreneurs and at least 20 venture capitalists. “If you talk to the people that aggregated the [$60 million] that I just described, their chief complaint about this region from an economic development standpoint, and from an investment standpoint, is everbody hugged them to death,” he said. Martin, who also serves as chairman of Mosaic technologies, Inc., underscored that local investors must tell the entrepreneurs “yes” or “no” when discussing often high-stakes start-up investments, instead of waiting weeks, or even months, to give an answer. This “sobering wake-up call” followed comments by Martin and others lauding the area’s “staggering” economic successes in 1999. Terry Woodworth, regional director of Virginia’s Center of Innovative Technology, mentioned the partnership of the University of Virginia, the city of Charlottesville and Virginia Piedmont Community College in creating the Biotechnology Training Center on West Main Street. Woodworth noted that the community’s stress on technical skills should be tempered by knowledge of the traditional liberal arts. “We need to be wise and not just tech savvy,” he said. Aubrey Watts, director of economic development for the city, said Charlottesville spent $57 million on new buildings in 1999 and is currently examining 80 economic development projects, including Gabe Silverman’s Union Station renovation. ‘I’m pleased to think some construction will occur on that point very soon,” he said of the Union Station site. Watts added that the number of business licenses issued was up 18 percent in 1999 and that the assessed value of commercial properties rose by as much as 8 percent. David Kalergis, director of University of Virginia Gateway, a program dedicated to bringing technology from the university into local commerce, mentioned the “evolution” that the UVa Patent Foundation has undergone toward working with the community. Robert S. MacWright, the foundation’s executive director, was one of five new group board members installed Tuesday. The Patent Foundation licenses UVa faculty and staff inventions to be brought to the commercial market. In his new role, MacWright said he plans to focus on the need to have experiences entrepreneurs – who have already been through the growth process – to aid start-up companies with each crucial step. He said the foundation also looks to be “tech enthusiasts,” encouraging venture capitalists to invest, although he said it is not in the foundation’s interests to engage in such financing. “We are in a high-risk business already,” he said. And he likened the buzz about forthcoming venture funds to a tornado, with a lot of enthusiasm and hype “swirling overhead.” “But exactly when that tornado is going to touch ground is uncertain,” he said.
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