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2004 2003200220012000 |
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Chattanooga
Hosts Venture Capital Forum to Help Start-Ups Find Investors Reprinted from the Chattanooga Times Free Press Tuesday, June 1, 2004 by Dave Flessner, Business Editor Russ Grove believes he can help busy Americans turn their surplus goods into quick cash through the online bazaar of eBay. But before he could launch his business dream last year, the founder of NuMarkets, LLC, needed some cash of his own. The Etowah, TN, entrepreneur said he ultimately found the investors he needed last fall at the Tennessee Valley Venture Forum in Chattanooga. "We're a different and hopefully very successful company today because of the forum," said Mr. Grove, who formed NuMarkets in July 2002 after spending 15 years at General Electric and running a dot-com company. "That helped us to refine our business plan and get the venture capital we needed to really take off." Within five years, Mr. Grove hopes to have more than 2,000 franchises worldwide using his software and shipping services to sell goods on consignment through the online auction service of eBay. Mr. Grove's pioneering business is the type Mayor Bob Corker believes is crucial to helping Chattanooga prosper. "We need to cultivate a culture that encourages successful risk-taking and those that invest in such businesses," Mr. Corker said. "We need to be the type of place where people want to start and grow businesses and venture capitalists want to invest to make money." Chattanooga missed out on most of the dot-com and biotech gold rush in high-tech areas such as Boston and California's Silicon Valley during the 1990s, Mr. Corker said. Until two years ago, Chattanooga didn't even have any local venture capital funds, and only a handful of wealthy investors were likely to put money into high-growth start-up ventures. But Mr. Corker, who said he wants to change the business culture of Chattanooga, believes the local market is changing. Tom Rogers, president of the Oak Ridge-based Tech 2020, agreed. "Tennessee is still catching up, but I think places like Chattanooga are showing a real desire to bring together venture capital and business entrepreneurs," Mr. Rogers said. "The venture capital market has been soft over the past few years, but we're seeing a renewed interest now in start-up ventures with growth prospects." VENTURE FORUM Mr. Rogers is bringing back the Tennessee Valley Venture Forum to Chattanooga in September. At the two-day event, 15 to 20 entrepreneurs will pitch their business plans to more than 300 venture capitalists and wealthy individuals looking to get in on the ground floor of successful start-ups. Organizers of the venture forum select the best businesses for the event from among dozens of applicants. By being selected from among many applicants, your business enjoys a level of credibility just by being included in the forum," said Pem Guerry, chief investment officer for Synix and a former director of the Tennessee Technology Development Corporation. "It's a great chance to explain your business model and interact with successful investors and managers." To apply for the chance to appear at the forum, businesses must submit an application by June 11. Applications are available at www.tvvf.biz. "The deal making that occurs at one of these events, as innovators and investors work together, energizes Chattanooga's own business community and enhances our city's vitality," said Mr. Corker, who hosted several hundred forum participants at his Riverview home last fall. Venture capitalists try to invest in rapidly growing companies before the businesses are able to borrow money from banks to issue public stock. To help lure venture capital to Chattanooga, the city put $1.5 million into the Chattanooga Opportunity Fund two years ago, helped sponsor the Tennessee Venture Forum here last year and now is providing office space for Delta Capital Management to operate its East Tennessee office in the downtown Enterprise Center. "I'm spending about half of my time now in Chattanooga," said Don Mundie, who organized Delta Capital in Memphis in 1992 to invest in high-growth companies in the Southeast. "Since we came into the market six or seven months ago, we have made three investment proposals to Chattanooga companies, and we're looking at more prospects. Chattanooga is showing real promise as a community trying to promote start-up businesses." Mr. Mundie is trying to raise up to $8 million in venture capital to fund Chattanooga Venture Partners, which will act like an "Angel" network of wealthy investors to identify promising local businesses. TRAILING TECHNOLOGY Without a research laboratory or doctoral degree-granting university, Chattanooga historically has trailed nearby Atlanta, Oak Ridge, TN, and Huntsville, AL, in nurturing technology startups. But new computer and Internet links have helped more entrepreneurs locate their businesses wherever they choose. The natural attractions of the self-proclaimed Scenic City of the South and the new venture capital funds could entice more entrepreneurs to locate here, local boosters said. U.S. Rep Zach Wamp (R-TN) is trying to position his hometown at the center of what he calls the Tennessee Valley Technology Corridor that spans from Huntsville through Oak Ridge and into upper East Tennessee. Rep. Wamp will kick off the 10th annual Tennessee Valley Corridor summit today in Knoxville to discuss technology initiatives across Alabama and Tennessee. Earlier this month, the U.S. Department of Commerce recognized Rep. Wamp's summit as one of the top regional economic development organizations in the nation, tying North Carolina's famed Research Triangle Partnership for first place. "The corridor has accomplished a great deal in the short span of 10 years and has quickly become a significant driver in the economic development arena and in pulling together the incredible resources that exist in our region," said Tom Ballard, chairman of the corridor's board of directors. Mr. Corker said Chattanooga is at the hub of the corridor, midway between Huntsville's Marshall Space Center and the Oak Ridge National Laboratory. "We can be the place the applies the technology from these federal facilities," he said. "And once you get that momentum going and businesses and venture capitalists prove successful, that success just feeds on itself and creates even more businesses and capital wealth. That's what we're trying to encourage in Chattanooga."
For more information
contact: Delta Capital Management, LLC 901.755.0949 Dave Flessner Chattanooga Times Free Press | |
