News

NASVF NetNews – October 14, 2004 – The electronic newsletter of the National Association of Seed and Venture – Funds

November 10-12 – 11th Annual Conference of the National Association of Seed
& Venture Funds

Register at: http://www.nasvf.org/web/nasvfinf.nsf/pages/2004conf-reg.html
Editor: [email protected]
(Please scroll down for the full story)

— Milken Institute: Biopharmaceutical Industry Contributions to State and
U.S. Economies

— Angel Financing: Trends for Today’s Entrepreneurs

— Knocking on Heaven’s Door: Angel Investors Offer Advice

— Other Angel News

— Wisconsin Investment Board Makes Wise Move in Supporting Venture Capital
Efforts

— University of Michigan’s Wolverine Venture Fund Sees First Portfolio
Company IPO

— Boston Area Venture Funding Takes Sharp Dive in Third Quarter

— Idaho Network Pools Financing Sources

— Dial Q for Funding

— North Carolina Gubernatorial Adviser : Tie Spinoffs of Universities to
Jobs

— Science, Commerce Mixing Well at Penn; University Center Turns Ideas
into Enterprises

— Arizona State University Technology Spin-off a Sight for Sore Eyes

— Minnesota U’s Bioscience Incubator Moving Closer to Reality

— Tucson OKs $1.9M for Drug Institute

— California Stem Cell Measure Aims for the Sky

— Alabama Vote May Help Cities Lure Jobs

— North Carolina Incentives for Business Popular in Cool Economy

— Jobs are Job 1 for Next Indiana Governor

— New Jersey Job-Growth Incentives Don’t Always Pay Off

— Louisiana Economic Fund May Get First Use

— Florida Scripps Project Faces Battle; Environmentalists Vow Lengthy
Fight

— Tech Workforce Ranks Shrinking

— NetNews Survey Reminder — Your Response Is Important

— Seminars & Conferences

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Milken Institute: Biopharmaceutical Industry Contributions to State and
U.S. Economies

A new study released Tuesday by the Milken Institute attests that there is
a good reason why governments across the country and around the world are
fighting hard for biopharmaceutical dollars: These companies have the
potential to add thousands of jobs and millions of dollars to their
economies. This study shows the strong economic impact that the
biopharmaceutical industry has on state and U.S. economies ? more than 2.7
million jobs and $172 billion in real output in 2003 when one includes the
full impact the industry has on all sectors of the economy:
http://www.nasvf.org/web/allpress.nsf/pages/9701

Massachusetts is better poised to capitalize on biotechnology and
pharmaceuticals than any other state, reports Jeffrey Krasner for the
Boston Globe:
http://www.nasvf.org/web/allpress.nsf/pages/9693

Led by Florida and North Carolina, the Southeast is expected to outpace
much of the rest of the country when it comes to growth in the high-paying
biopharmaceutical industry, writes Bob Keefe in the Atlanta
Journal-Constitution:
http://www.nasvf.org/web/allpress.nsf/pages/9694

Terri Somers of the San Diego Union Tribune cites the study in reporting
California’s biopharmaceutical industry, already one of the largest in the
nation with 70,000 workers and a $9.6 billion economic output, should
nearly double over the next decade:
http://www.nasvf.org/web/allpress.nsf/pages/9699

Biotech and pharmaceuticals, among the nation’s fastest growing and most
productive industries, are alive and well in Missouri, writes Rachel Melcer
in the St. Louis Post-Dispatch:
http://www.nasvf.org/web/allpress.nsf/pages/9695

The biopharmaceutical industry in Utah packs a much bigger economic wallop
than it did a decade ago, writes Brice Wallace in the Deseret Morning News:
http://www.nasvf.org/web/allpress.nsf/pages/9708

And Kathleen Gallagher of the Milwaukee Journal Sentinel notes that
Wisconsin is one of the 20 states best-positioned to expand its
biopharmaceutical industry, although it’s not among those that will add the
most jobs in that sector:
http://www.nasvf.org/web/allpress.nsf/pages/9696
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Angel Financing: Trends for Today’s Entrepreneurs

Angel investors have long been a primary source of financing for companies
at the seed and start-up stages. However, in the recent past, as venture
capitalists have backed away from funding enterprises at these early
stages, angels have become recognized as the primary source of funding at
this stage of company development. What’s more, writes Bill Payne for
EntreWorld, having in the past largely operated individually and behind the
scenes, they are now banding together in groups, enabling them to share
information about companies worthy of funding and pool their collective
resources:
http://www.nasvf.org/web/allpress.nsf/pages/9624
___________________________________________________
Knocking on Heaven’s Door: Angel Investors Offer Advice

As any angel investor will tell you, this is not venture capital. Instead,
writes David Forman, Small Times Business Editor, there may be less
pressure to generate extraordinary returns or engineer a fast exit. Angel
investors tend to tout the ethics of self-sustainability and the virtues of
running on fumes:
http://www.nasvf.org/web/allpress.nsf/pages/9702
___________________________________________________
Other Angel News

In 2003, the Great Lakes Angels had 7 monthly events, shared 55 deals and
had 12 of those companies present to the group. 3 companies that presented
received some funding:
http://www.nasvf.org/web/allpress.nsf/pages/9669

Four of Ottawa’s most active seed investors are expected to launch the
Ottawa Angel Alliance. It’s intended to be a group of more than 50
individuals who will invest significant amounts of money in the region’s
newest startups, writes James Bagnall of the Ottawa Citizen:
http://www.nasvf.org/web/allpress.nsf/pages/9668

So-called angel financing, eclipsed for a time in the 1990s by venture
capital, again is on the lips and agendas of those promoting the growth of
early-stage companies in Arizona. Jane Larson reports for the Arizona
Republic that organizers of the Arizona Venture Capital Conference, for
example, decided to kill off their 12-year-old event, at least for this
year, and replace it with the one-day Arizona Angel Investment Conference
on Dec. 1:
http://www.nasvf.org/web/allpress.nsf/pages/9675

Golden Capital Network (GCN), in association with the Sierra Angels, Nevada
Center for Entrepreneurship and Technology (CET), and Nevada Commission on
Economic Development, presented the 4th Annual Silver & Gold Venture
Capital Conference, at the Atlantis Hotel in Reno on October 5-6, 2004. The
sold-out event featured 28 emerging growth companies from the Life
Sciences, Emerging Technologies, Software/IT and Communications Technology
sectors.
http://www.nasvf.org/web/allpress.nsf/pages/9709
___________________________________________________
Wisconsin Investment Board Makes Wise Move in Supporting Venture Capital
Efforts

The 800-pound gorilla of capital formation in Wisconsin, the State of
Wisconsin Investment Board with $70 billion in assets, is beginning to flex
its muscles on behalf of the state’s economy. As the ninth-largest public
fund in the country and 23rd-largest in the world, SWIB (as the board is
known) has plenty of financial clout, writes the Milwaukee
Journal-Sentinel’s John Torinus:
http://www.nasvf.org/web/allpress.nsf/pages/9681
___________________________________________________
University of Michigan’s Wolverine Venture Fund Sees First Portfolio
Company IPO

The Wolverine Venture Fund (WVF), the only university-based venture fund of
its type in the United States and a signature program of the Samuel Zell &
Robert H. Lurie Institute for Entrepreneurial Studies (as part of the Ross
School of Business at the University of Michigan), today announced that
IntraLase, one of its portfolio companies, has made its initial public
offering (IPO) on NASDAQ. IntraLase, trading under the symbol "ILSE," is
the first of the WVF’s portfolio companies to go public since the Fund’s
inception in 1998:
http://www.nasvf.org/web/allpress.nsf/pages/9670
Editor’s Note: Tim Faley, Managing Director of the Wolverine Venture Fund
is a scheduled speaker at the NASVF Conference in Salt Lake City next month
___________________________________________________
Boston Area Venture Funding Takes Sharp Dive in Third Quarter

Smaller-size deals in the third quarter were one reason behind a sizable
drop in venture capital investment in New England, according to a report
out this week. While some local venture firms reported continued strong
deal flow through the quarter, total dollars invested in Massachusetts,
Rhode Island and New Hampshire dropped 51 percent from the second quarter,
writes Tom Witkowski of the Boston Business Journal:
http://www.nasvf.org/web/allpress.nsf/pages/9689
___________________________________________________
Idaho Network Pools Financing Sources

Treasure Valley entrepreneurs may soon have an easier way to find financing
for their new business ventures through the Idaho Capital Network, a
fledgling network of existing entities. The Idaho Capital Network, expected
to be up and running by the end of the year, will serve as a referral
service, helping start-ups find the appropriate financing. Julie Howard of
the Idaho Statesman reports that the network will work with traditional
banks, private equity groups, angel investors and venture capital firms,
but also can assist entrepreneurs on Small Business Innovative Research
grants from the federal government:
http://www.nasvf.org/web/allpress.nsf/pages/9671
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Dial Q for Funding

From a nondescript office building overlooking the Potomac River, a small
venture capital firm invests millions of dollars in some of the world’s
most advanced high-technology companies. But In-Q-Tel isn’t a typical
venture firm. For starters, writes Bob Keefe in the Austin American
Statesman, it’s a nonprofit:
http://www.nasvf.org/web/allpress.nsf/pages/9686
___________________________________________________
North Carolina Gubernatorial Adviser : Tie Spinoffs of Universities to Jobs

Governor Mike Easley’s science adviser wants technology spun out of state
universities to be judged by how many jobs are created – an emphasis on
economic development that’s currently a secondary goal of professors and
campus officials, writes Leo John of the Triangle Business Journal:
http://www.nasvf.org/web/allpress.nsf/pages/9691
___________________________________________________
Science, Commerce Mixing Well at Penn; University Center Turns Ideas into
Enterprises

When University of Pennsylvania doctoral student P. Peter Ghoroghchian
brought together two of his professors for an academic experiment, he was
also thinking of the idea’s commercial prospects. This week, reports Porus
P. Cooper of the Philadelphia Inquirer, he was among a throng of Penn
researchers pitching their innovations to prospective investors and
business managers:
http://www.philly.com/mld/inquirer/business/9873816.htm
___________________________________________________
Arizona State University Technology Spin-off a Sight for Sore Eyes

Arizona State University researchers are hoping to see green from a new
spin-off company focused on developing an anti-inflammatory drug that
targets eye disease. Called Cynexus, the new company is one of a handful
coming out of ASU research and one of at least seven that are expected to
spin off within the next year, reports Angela Gonzales in the Phoenix
Business Journal:
http://www.nasvf.org/web/allpress.nsf/pages/9690
___________________________________________________
Minnesota U’s Bioscience Incubator Moving Closer to Reality

After a year and a half of planning and fundraising, the University of
Minnesota is moving forward with its plan to open a bioscience research
incubator in St. Paul’s Midway area, writes Jackie Crosby of the
Minneapolis Star Tribune:
http://www.nasvf.org/web/allpress.nsf/pages/9697
___________________________________________________
Tucson OKs $1.9M for Drug Institute

A UA-sponsored think tank being created to speed the approval of new drugs
will get $1.9 million from the city over the next five years, the City
Council agreed Monday. Joe Burchell of the Arizona Daily Star reports that
the money is contingent on the University of Arizona, SRI International and
the U.S. Food and Drug Administration finalizing their plans for the
operation. It also is subject to annual appropriation, which could be
withheld by the council if the group stumbles:
http://www.nasvf.org/web/allpress.nsf/pages/9698
___________________________________________________
California Stem Cell Measure Aims for the Sky

State Sen. Deborah Ortiz tried to revolutionize medical research with the
nation’s first law authorizing embryonic stem cell research. But the
Sacramento Democrat couldn’t get California legislators to pay for the
studies scientists say could lead to treatments and cures for about 70
diseases. So she proposed another revolutionary idea: a general obligation
bond to pay for the scientific inquiries, writes Laura Mecoy of the
Sacramento Bee:
http://www.nasvf.org/web/allpress.nsf/pages/9687
___________________________________________________
Alabama Vote May Help Cities Lure Jobs

When Montgomery landed the Hyundai auto assembly plant in 2002, the
Legislature had to rush to pass a constitutional amendment to allow the
city and county to pay the incentives they had promised the auto company.
On Nov. 2, Alabama voters will decide whether to give that power to other
cities and counties that don’t have it. Phillip Rawls of the Montgomery
Advertiser reports that Amendment Three would affect 20 counties and the
cities within them:
http://www.nasvf.org/web/allpress.nsf/pages/9685
___________________________________________________
North Carolina Incentives for Business Popular in Cool Economy **

Carolinas Poll When it comes to spending taxpayer dollars to attract new
businesses, Sue Barnes, a Mooresville retiree, has had a change of heart.
After years of watching companies shut down or move jobs to other states,
Barnes now believes economic incentives, such as tax cuts, can help create
badly needed jobs. She is among a growing number of N.C. residents who
favor incentives, according to the 2004 Charlotte Observer/WCNC 6News
Carolinas Poll. Kerry Hall writes for the Charlotte Observer:
http://www.charlotte.com/mld/observer/business/9888567.htm
___________________________________________________
Jobs are Job 1 for Next Indiana Governor

Norm Heikens and Matthew Tully if the Indianapolis Star examine the
economic development programs of Indiana’s gubernatorial candidates, but
fixing Indiana’s economy in the long term will be a daunting task,
according to an analysis of job statistics by The Star. Despite losing
more than 100,000 manufacturing jobs in the past five years, the
concentration of those vulnerable jobs is higher in Indiana than any other
state. And in recent years, Indiana’s diversification away from
manufacturing employment, which is threatened by technological gains and
overseas competition, hasn’t occurred at the same pace as the rest of the
nation. About 570,000 Hoosiers now are employed in manufacturing:
http://www.nasvf.org/web/allpress.nsf/pages/9683
___________________________________________________
New Jersey Job-Growth Incentives Don’t Always Pay Off

Six years ago, the future looked bright for drug maker Organon
International’s operations in West Orange. With drugs poised for regulatory
approval, the company was predicting boom times at the plant on Mount
Pleasant Avenue, including the prospect of hiring almost 400 workers. State
officials were eager to help. Through a program designed to reward firms
for bringing work to New Jersey, the state in 1999 agreed to pay Organon
$800,000 for creating jobs in West Orange and keeping them for at least 15
years. Dustan McNichols reports on the outcome for the Newark Star-Ledger:
http://www.nasvf.org/web/allpress.nsf/pages/9680
___________________________________________________
Louisiana Economic Fund May Get First Use

Louisiana’s new "rapid response fund," at the disposal of Gov. Kathleen
Blanco, may have its first signatory. BST Manufacturing Inc., which makes
explosives for mining, construction and other industrial uses, plans to
build a $2 million facility on a closed Army munitions facility in Minden
in south Webster Parish. Ned Randolph reports that the state is trying to
acquire the federal land to turn 15,000 acres into an industrial park
http://www.nasvf.org/web/allpress.nsf/pages/9678
___________________________________________________
Florida Scripps Project Faces Battle; Environmentalists Vow Lengthy Fight

One year after Gov. Jeb Bush announced plans to bring The Scripps Research
Institute to Florida, chemist Chris Liang stands in his Boca Raton
laboratory, mixing compounds designed to block the growth and spread of
cancer cells. If everything goes right, Liang says, he could have a new
drug candidate ready for clinical trials as soon as next year, writes
Stacey Singer of the Palm Beach Post:
http://www.nasvf.org/web/allpress.nsf/pages/9677

The Scripps Research Institute won approval Wednesday to build a biotech
center in rural Palm Beach County — dimming Orlando’s hope at making a
grab for what has been described as the crown jewel of Florida’s 21st
century economy. But the deal to bring Scripps’ East Coast headquarters to
Florida is anything but settled. Environmentalists immediately promised a
lengthy legal challenge, something that Scripps officials have said they
consider a worst-case scenario.
http://www.nasvf.org/web/allpress.nsf/pages/9710
___________________________________________________
Tech Workforce Ranks Shrinking

Battered by the technology industry bust, half of the 1 million tech
workers tracked from the industry’s peak in California in 2000 have left
the field, a new landmark study shows, report Deborah Lohse and Mark
Schwanhausser for the San Jose Mercury News:
http://www.mercurynews.com/mld/mercurynews/business/9866921.htm
___________________________________________________

NASVF NetNews Survey
Thanks to all of you who have responded to our brief survey on the future
of NASVF NetNews. If you are among those who intended, but have not yet
gotten around to responding, we would appreciate you input. It is
important. Here is a link to the survey:
http://www.nasvf.org/nasvf/survey.nsf/survey1
___________________________________________________
Investor and Entrepreneur Seminars & Conferences

Offered by NASVF:
Salt Lake City, UT
November 10-12 – Annual Conference of the National Association of Seed &
Venture Funds
Check out the conference outline and speakers at:
http://www.nasvf.org/web/nasvfinf.nsf/pages/2004agenda.html
and the featured subject-matter tracks at:
http://www.nasvf.org/web/nasvfinf.nsf/pages/2004tracks.html
NASVF members and invited guests register at:
http://www.nasvf.org/web/nasvfinf.nsf/pages/2004conf-reg.html

VC Radio –
October 13, 2004
"Investing in Technology Enterprises" with John Higginbotham from
Spacevest, Reston VA and Jim Smith from Mohr, Davidow Ventures, Menlo Park
CA
To listen: http://lab2ipo.org/VCRadioShow

Offered by our Friends:
Fairfield, IA
October 20, 2004 – Community Entrepreneurship Academy
http://www.cvcia.org

Chicago, IL
October 21, 2004 – Growing Your Business Like Crazy
http://www.moltz.com/CrazySeminar.html

Cambridge, MA
Oct 24-26 – Investors’ Circle 2004 National Conference
http://www.investorscircle.net/Conference2004.html

Los Angeles, CA
Nov 11, 2004 – Project T2: ATechnology Transfer Conference
http://www.larta.org/t2

Salt Lake City, Utah
February 1-2, 2005 – 21st Annual Investors Choice Venture Capital
Conference

Home

Dayton, OH
March 7-8, 2005 – Ohio Valley Affiliates for Life Sciences — The Promise
of Innovation
http://www.OVALS group.org

Arlington, TX
Mar 28-30, 2005 – World’s Best Technologies Showcase
http://www.wbt05.com

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