Australian venture capital firms are looking to invest over $600 million in ICT companies; but good ideas will not attract funding, it's good businesses they're looking for.
In yesterday's VC Connect NSW 2004 conference, supported by venture capital (VC) firms and the NSW Department of State and Regional Development (DSRD), speakers talked up the benefits of VC funding for early-stage ICT companies.
Loftus Harris, director general DSRD quoted Ralph Waldo Emerson, saying "a creative economy is the fuel of magnificence". Harris said that with 80 percent of NSW's GDP coming from the services industry -- compared to under 6 percent from agriculture and mining and 14 percent from manufacturing -- it was time to "shift the way we see ourselves".
Michael Quinn, chairman of Innovation Capital, said "venture capitalists don't invest in great ideas, because we see squillions of them every day -- we invest in businesses".
He said it was imperative that companies had a strong, executable business plan when trying to attract VC investment. And he said it wasn't just about the money: "VCs do more that just provide the money... a good VC ought to help to grow the business."
Quinn acknowledged that VC backing was just one way for early-stage companies to grow saying venture capital probably funded less than 1 percent of business. Although Steve Lane, partner at CM Capital, later added that a high proportion of successful technology companies had had VC backing.
Speakers at the conference included venture capitalists, lawyers and successful entrepreneurs, who delivered a series of discussion panels outlining the ins and outs of attracting and working with VC funding.
The day was interspersed with networking sessions where potential ICT entrepreneurs could meet and discuss investment opportunities with venture capitalists from some of Australia's leading venture capital firms, with over $600 million between them in available funds for ICT companies, according to a press release from conference organiser, Slattery IT.