NC Treasurer Talks Innovation Fund @ American Tobacco

Janet Cowell visited American Tobacco in Durham last night for a late afternoon update on the Innovation Fund as well as an informal panel discussion with local entrepreneurs. The panel included:
– James Avery, CEO, Adzerk
– Jud Bowman, CEO, Appia
– Joe Davy, CPO, EvoApp
– Chris Porter, COO, Clinipace
– Sloan Rachmuth, CEO, HealtheMe
– Rachel Weeks, CEO, SchoolHouse.

About 100 jammed into the classroom in the American Underground for about 1 1/2 hours to talk about the need for more capital in the area. Ms. Cowell shared that about $100M of the $235M has been invested in 3 funds (including Hatteras) and 6 individual later stage investments. She also added that there are plans for a Life Science directed fund possibly announced in the fall. Discussion themes included jobs, startup & expansion capital, large company vs small company support, tax incentives for founders and investors, the disappointment in the shutdown of LaunchBox (our local accelerator) and the lack of a direct flight to the west coast.

One one hand, I was energized to see a pretty diverse group of people come together. On the other hand the accelerator discussion from James, Jud and Sloan brought one of the more critical regional holes to a head. With my involvement spearheading then managing the LaunchBox program over the past 2 years – I was asked all evening on why LaunchBox couldn’t hold past 1 year. At this point the details are less important than our collective decision on what to do next. The team, space, playbook, mentors and local/national entrepreneurs are there.

With the state clearly concentrating on Life Sciences now and in the future, I wonder where that leaves the tech ecosystem.

Afterwards, Appia invited all to their office in the PowerPlant. Thanks to CED, Appia and Clinipace for organizing and supporting the meeting.

Speaker, investor, mentor, startup founder. One of 3 or 4 Co-Founders of MapQuest (sold to AOL for $1.2B). Managing Director of $25M Venture Fund in late 90's. CEO, COO or President of various companies ranging from $200k to $20M in size. One of two Managing Directors of The Startup Factory (35 investments across 7 cohorts), founder and MC of the Big Top Reverse Job Fair and national writer and speaker waxing poetic around startups and startup communities. Currently EIR @ Techstars with Brad Feld ~ Startup Communities, to help community leaders around the world grow their startup community.

1 comments On NC Treasurer Talks Innovation Fund @ American Tobacco

  • Good summary overall, but the recap sort of glosses over what I thought was the dominant theme of the meeting — the lack of early stage investment capital available in the area. That was the context of the discussions about LaunchBox, investor and entrepreneur incentives, gov’t support for later stage companies vs. early stage, motivating young entrepreneurs to build their businesses here, etc.

    Re: LaunchBox, although you say it’s not important why the fund couldn’t continue after 1 year I actually think it’s VERY important. If we don’t learn why it failed and apply that knowledge to the next incarnation (if there is one), why should we expect a different result? Based on conversations with some of the folks involved and a comment by a LaunchBox investor in the article written by James Avery, it appears that there were plenty of mentors and advisors helping LB, but not enough investors.

    As a result, the burden fell onto the same 5-10 guys who are already actively investing in the area, and it’s not fair to expect them to bear all of the financial responsibility for supporting the local tech community. So ironically I think that the people who took a leadership role with LaunchBox and tried to make it a success are the ones who are now getting blamed for its break.

    If you take a step back and look at the purpose of an accelerator or incubator, it (a) helps entrepreneurs get connected to mentors, customers, and potential investors, and also gives the kids graduating from local schools with entrepreneurial aspirations a reason to stay in the area and think they can make it happen here (instead of moving to SV, NYC, BOS, etc.) and (b) helps investors identify opportunities that they might not otherwise be aware of.

    The thing is, investors in this area don’t have a problem finding the companies they want to invest in and there is basically no competition for deals. There are a fairly small number of invest-able tech startups in the area, and most of them can be found at one of the many networking events. So why should an investor support an incubator in this area? Why not just invest directly in the few companies you like and eliminate the overhead of an accelerator program?

    The only reason I can think of is to support the long term health of the tech community here, and ultimately that can’t fall on the heads of 5-10 people. Others need to get involved — and as more than mentors, advisors, etc.

    If people make that commitment I think it will pay off in the long-term because NC will have more start-up success stories and more entrepreneurs will stay in the area and give back to the community once they achieve exits. Without that commitment, I think we’re just going to keep repeating the same cycle over and over.

Leave a reply:

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Site Footer