Funding 101 – Following tech bust, companies must be on solid footing to capture interest of private investors

Not so long ago, it was as easy to secure venture funding in Austin as it was to find a rhythm guitarist. Times certainly have changed since the days of the bubble, but capital is still out there for those bold enough to look for it.

"Funding is not as crazy as it once was, but there is still lots of funding available for good companies," says David Gerhardt, managing partner of CapNet Ventures, a local firm that provides a range of services to help companies build their businesses.

One of the most intimidating hurdles an entrepreneur faces is raising start-up capital. But the process can be made less daunting by simply understanding the basics of funding.

Funding plays a vital role throughout the life of a business, and venture capitalists stress the importance of understanding the stages of business growth to determine the appropriate source of capital per stage.

"A company’s growth and eventual transition from stage to stage often corresponds with its success in developing its business, selling its products and gaining revenue," says Bob Martin, CEO of JumpStart Partners Inc., an Austin-based merchant bank that focuses on mergers and acquisitions.

Jason Meeker
Austin Business Journal staff

Full Story: http://www.bizjournals.com/austin/stories/2005/03/28/focus1.html