Research Triangle Park, N.C. — Entrepreneurs seeking funding for new companies and products need not fear that a slowing economy will affect venture capital investments, according to Steve Nelson of the Wakefield Group.

Nelson, one of the region’s most active venture capitalists, will be leading a panel discussion about the capital markets at the Council for Entrepreneurial Development’s Venture 2008 conference next week. The event, set for April 16-18 at the Washington Duke Inn and Golf Club, will feature scores of presenting companies from as far away as Indiana and investors from across the U.S.

Inn a Q&A with Local Tech Wire, Nelson said entrepreneurs with “great ideas” can still attract investors. It’s also his belief that venture funds will also continue to be able to raise capital.

However, startups looking to find successful “exits” through initial public stock offerings face a difficult challenge, Nelson added.

The interview:.....

Yes, I think they are reduced to one lane. Only the very best companies that have probably something close to $100 million in revenue; a quarter or two of profitability (for a tech or biotech company- with promising results/product- assuming they want to take it public).

In the current economic environment, are venture capitalists and angels going to be more reluctant to invest?

Not for great companies or great ideas. There will be a focus on seasoned or previously successful entrepreneurs. Those with unproven business models or those that haven’t done it before will have a challenge for raising funding. More focus will be placed on the entrepreneurs with a track record.

Will venture capital firms have difficulty in raising new funds?

It is all about track record and performance. It will not be difficult for those who have a track record of success and performance. Those with a great investment team, a unique strategy, and a history or track record (IIR) will have no problem raising money but for others it may be a challenge.

When financial markets are tight, what must entrepreneurs do in order to attract investors at early stag?

For tech companies, demonstrate early customer successes or wins (where two or three customers have selected you over a competitor-proof points). For the biotech side, show you are previously successful or that you have an incredibly promising science- something that will change the world that would be worth taking the risk for.

Given how much venture capital has been raised the past couple of years, are VC funds in general still adequately stocked with capital to make investments?

Yes, absolutely. I think it will be the survival of the fittest. The best venture firms will continue to raise capital.

What does the investment climate look like from a deal flow perspective? Are there still good companies and ideas/products out there that deserve funding?

Yes, no question about it. It would need to fit the model of a promising idea or have a successful track record.

Is a particular sector hotter than others?

Biotech/life sciences: drug discovery is one that is attracting capital; advanced materials/nanotech

Tech: Software as a service (SaaS); Web 2.0 platforms and services; Mobile/wireless

Public safety (life after 9/11)

Recent reports about investments in Web 2.0 companies seem to indicate that market is maturing. Do you concur?

I think the maturing for Web 2.0 with regards to social networking many have already matured- but Web 2.0 with more of a focus on business and consumers is still to come.

Looking beyond the rage for social networks and opportunities to capitalize on them, what's coming next? What's the next wave?

Business services and those mentioned (earlier). But personalized medicine will be important and exciting to watch moving forward.

Do you see good investment opportunities in the Research Triangle and in North Carolina?

Absolutely, successes and winners are created here which is of interest to outsiders. We have a lot to offer people and we are a welcoming community for investors, entrepreneurs, etc. RTP is a draw because of its innovation of science and technology coming out of local universities, we have entrepreneurs with a track record, and big businesses here. Add to that access to capital and a wonderful place to live and work and you get a lot of promise and growth potential. Others have already arrived (Boston, Silicon Valley, etc) we are the next great place.

Copyright 2008 by WRAL.com. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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Starting in 2007, the list was expanded ten-fold to 5,000. The deadline for the 2008 list, to be publicized in September, is April 30, 2008. For more information, visit www.inc.com/inc5000apply/.

So I was REALLY thrilled when she asked me to be one of the Masthead Contributors

"Startup Chatter" not only has great content, but will offer some of the opportunities that CED provides in the "real world" and incorporates in its own Startups247.com space and digital demo/presenter pavilions, There will be spots for tech innovators to make their pitches, collaborate with peers to fuel startup creativity, gain public attention, share ideas, build a team, partner up, seek financing and grow, through mutual support. Sounds like a strong alignment with CED's and we look forward to synergies with Donna's new community

If you follow the internet business sector (e.g. Google, Microsoft, Facebook) check out "Inside Chatter." Donna goes way beyond peeling the hype-onion on any company who flirts with world domination.

Oren Cohen, Chief Medical and Scientific Officer for Quintiles Transnational Corp., advises that having on the ground experience in the foreign market you are looking to do business in is essential

Deepak Advani, Chief Marketing Officer and Senior Vice President of Global ecommerce for Lenovo says that localized marketing is important to achieve global success. “You need to segment your marketing efforts, research your global audience and understand the culture,” advises Advani. To speed up your global impact, Advani suggests collaboration and partnerships, and leveraging the web and social networking. "In order to maximize your effectiveness, you need to understand the local culture, and adapt your marketing so it resonates with the target audience. Also important is understanding your route to market- where relationships with local resellers and retailers can be critical to success.” Deepak Advani’s Recommended Read: Wikinomics by Don Tapscott and Anthony Williams

Neil Bagchi, an associate with Kennedy Covington’s India Advisory, suggests that the keys to global success are partnership, people and relationships. "You need to spend a considerable amount of time finding the right people and cultivating the right relationships before jumping into cross border ventures," Bagchi recommends. "Globalization is not for every company, and global business is not something that happens overnight. You need to consider the costs and risks associated; ensure that it fits within your company’s business model; and be sure you are working with people you trust." Neil Bagchi's Recommended Read: Planet India by Mira Kamdar

Additional global resources and books recommend by other panelists and speakers at CED’s Globalization conference:

* http://www.startups247.com/forum/all
* http://export.gov/
* The World Is Flat: A Brief History of the Twenty-first Century by Thomas L. Friedman
* Good to Great: Why Some Companies Make the Leap... and Others Don't by Jim Collins
* Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant by W. Chan Kim and Renée Mauborgne
* The Fall of Advertising and the Rise of PR by Al Ries and Laura Ries
* The Ultimate Question: Driving Good Profits and True Growth by Fred Reichheld

Listen to Thomas L. Friedman's address on "New Policy, New Politics." Mr. Friedman is a columnist for The New York Times, specializing in foreign affairs.

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Listed in alphabetical order, the 2008 Top Seven are:

1. Dundee, Scotland, United Kingdom. This former industrial center known for “jute, jam and journalism” has transformed itself through intensive government-academic-business collaboration and broadband deployment into a UK center for life sciences and digital media. An innovative smart card for citizens was so successful that the Scottish Government asked Dundee to run its national program. With rising net job growth and business starts, Dundee has created a Digital Observatory to track its future progress as an Intelligent Community. (Top Seven 2007)

2. Fredericton, New Brunswick, Canada. This community of 50,000 was a broadband “have not” until the City Council led an effort to aggregate public-sector, university and business demand and created e-Novations, its own fiber carrier, then launched the Fred-eZone wireless network offering free connectivity across the city. Today, Fredericton contains 70 percent of the province’s knowledge-based businesses and is using ICT to substantially reduce its carbon footprint.

3. Gangnam District, Seoul, South Korea. With only 2.5 percent of Seoul’s population, this district produces 25 percent of the city’s economic activity, and has invested its wealth in the next generation of e-government. Since 1995, a relentless digital drive has reduced the cost of government while delivering online services, education, quality of life programs and e-democracy to citizens. Over 70 percent of citizens have received ICT training through schools, community centers and a TV GOV program. (Top Seven 2007)

4. Northeast Ohio, USA. The communities of this region are rising from the ashes of deindustrialization to recreate the entrepreneurial business, political and social culture that produced its first wave of prosperity. A successful fiber network deployment by OneCommunity has been leveraged by government and nonprofits to jumpstart new investment, improve healthcare delivery, bring the best in culture and education to urban schools, and engage tens of thousands of area leaders in collaboration over regional economic development.

5. Tallinn, Estonia. A suggestion by Estonia’s president in 1995 that schools be connected to the Internet led to an ICT revolution that has linked 100 percent of Tallinn’s secondary schools to the Web and established over 600 public access points. More than 100,000 adults have received ICT training, while e-government programs have produced one of the most advanced smart card systems in Europe and a middleware program that slashes the costs of e-government. It was not until 2004 that the last Russian troops left the country, yet today, Tallinn receives 77 percent of all foreign direct investment into Estonia and seven out of ten in its workforce are in the service sector. (Top Seven 2007)

6. Westchester County, New York, USA. This suburb of New York City was largely ignored by broadband carriers until it amassed demand from public agencies and built a multi-gigabit fiber network that now serves over 3,500 companies. Determined to maintain the quality of life that is its most compelling advantage, the county has invested in promoting business growth, improving the skills of its workforce and fighting digital exclusion in a community that has seen new immigrants become 35 percent of its population.

7. Winston-Salem, North Carolina, USA. Powerful government-business-academic collaboration led by Wake Forest University permitted this former “tobacco capital” to build a fiber network that spurred demand and led to an 88 percent broadband penetration rate. The partners have used this digital foundation to develop free computer labs across the region, create an e-government portal that is number three in the nation, and build a sustainable ICT skills training program. The city and county now count 37,000 biotech employees as residents and will fund a program to put Pcs and broadband connections into the homes of low-income students.

“No Intelligent Community we have studied has succeeded without strong leadership. Effective leaders identify challenges, set priorities, communicate a compelling vision and foster a sense of urgency about achieving it. They establish a collaborative environment that encourages risk-taking and creates win-win relationships with partners in government, businesses and institutions,” added ICF Chairman, John G. Jung.

“This group of seven demonstrates dramatically how broadband technology, enlightened public policy and the power of culture can transform government, businesses and citizens. Broadband is the next essential utility, as vital to prosperity as clean water and good roads. These communities offer us inspiring models of the best ways to put it to work.”

U.S. cities made the ‘intelligent’ list, but U.S. policy is still ‘pathetic’, said Conference Chair and PTC Vice President Ken Zita. Korea and Japan are completely overhauling their telecommunications and regulatory infrastructure by 2011, which will erode U.S. broadband leadership, said Zita.

Now Richard has presented new research -- The Flight of the Creative Class: The New Global Competition for Talent -- which resonates with us. His three Ts that draw people to a city: Technology, Talent, and Tolerance are strengths here. With talented people choosing what are essentially "good places to live," rather than just "where the work is" the Triangle is favorably positioned.

I recently sent Richard a link to "It's Carrboro" -- the "rap" video created by Billy Sugarfix, Brian Risk and other true believers -- explaining to him that Carrboro is Cary's "evil twin." He was -- to put it mildly -- awestruck. "In a word it is amazing. It is exactly the message our communities need to send, not to just to each other but to the world."

It's become our favorite at CED and at the Doss House. Whenever we need to get our Mojo working, this cures what ails us Watch the Its Carrboro Video. Enjoy!

Read the whole article here.

Learn more about the results of the 2nd annual Staples National Small Business survey. The survey was based on an Internet poll that queried more than 300 small businesses with less than 20 employees each.

From the Public Forum Institute.

"For the first time since President Bush took office, small business programs will receive a real funding increase," Sen. John Kerry (D-Mass.), chairman of the Senate Small Business and Entrepreneurship Committee, said in a statement.