Santa Rosa chamber finds way to support startups

<p>Recently I was at a venture capital conference on Sand Hill Road in Palo Alto. I sensed an optimism that has been missing since the tech bust, and the audience reflected the brightest minds from every part of the globe. But there were two comments at the event that gave me pause.</p><p>One speaker noted that venture capital funds are cash-heavy since there are only limited investment opportunities in later-stage companies. Venture capitalists, having been burned by the exuberance at the end of the 1990s, were only looking to invest in established companies. An audience member challenged the speaker with a question: How does a startup company get funding? The speaker’s response: That part of the market has been left to “angel” investors – high-net-worth individuals who invest in entrepreneurial companies, usually at an early stage.</p><p>I was chatting with a partner in a venture capital firm about some exciting startups in the North Bay. His response was that he wouldn’t invest in the firms since the North Bay was "too far" from Sand Hill Road.</p><p>What I took away from the event was that we have to focus on developing more of our own angel investing resources. </p><p>The Santa Rosa Chamber of Commerce has an Entrepreneurial Pathways Program to support startup companies, and I have been impressed with the innovation and enthusiasm of founders of new companies in our area. They’re every bit as creative as in Silicon Valley. </p><p>When you look at successful innovative companies in the North Bay, they are overwhelmingly homegrown. Given the cost of living, it’s unlikely that a major company like Hewlett-Packard/Agilent Technologies will open a new facility in this area. The future for our economy is retaining existing companies and jobs – and keeping the pipeline full of startups. The single biggest challenge for startup companies is finding financing.</p><p>We have been fortunate to have the North Bay Angels, led by Steve Weiss, which has funded dozens of companies. However, their resources only allow them to fund a small percentage of deals presented to them, and many good projects go unfunded. </p><p>Our community needs to do more. As a first step, the Santa Rosa Chamber and the City of Santa Rosa last year collaborated on an angel investing event – The North Bay Growth, Innovation and Venture Forum. A second forum is being planned for later this year.</p><p>The purpose of the events is to stimulate greater interest in angel investing and highlight 10 to 15 local companies that are looking for private equity investments. We partnered with the Golden Capital Network, a nonprofit group that has helped startup companies find over $400 million in investments.</p><p>Our regional economic future rests on the creation of innovative startup companies and assisting them in achieving success. Local startups are critically in need of seed funding to be successful. Without these companies, we run the risk of becoming a quaint tourist attraction. We have the tools to confront this challenge locally, and the answer is to grow our own.</p><p>•••</p><p>Chris Lynch is executive vice president of the Santa Rosa Chamber of Commerce. He can be reached at 707-545-1414.</p>