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  • Thomas Thurston

4 Venture Capital Highlights For Oregon

Updated: Apr 3

Yesterday was Venture NW, an annual venture capital conference held in Oregon and sponsored by the Oregon Entrepreneur Network.  The focus was innovation, startups and venture capital in Oregon. 


Here are 4 highlights:


1. Entrepreneurs are Mad as Hell

Diane Fraiman, a Venture Partner at Voyager Capital, kicked things off with a statement that was echoed throughout the conference.  “Entrepreneurs are mad as hell,” and that’s a good thing because passion is a prerequisite to progress.  Like the five steps of depression, here are “Diane’s 5 Steps to Kicking Ass”:

  1. Shock (…that the economy was going down the drain)

  2. Denial

  3. Depression

  4. Whining

  5. Anger (… and ass-kicking!)


2. Regional VCs Are Starting to Do Deals Again

Credit Suisse (who manages the Oregon Investment Fund) said it invested in 13 venture capital firms.  From those investments, $198 million went to 30 companies in the Pacific Northwest ($152 of which went to Oregon companies). 


This year (2010) may be the best year for Oregon venture capital in the past four (more than a 150% cash-on-cash increase in Oregon VC investments since last year).  Examples of venture-funded firms in Oregon include:

  • TrustID

  • Tripwire

  • Jive Software

  • Elemental Technologies

  • Urban Airship

  • Puppet Labs

  • Survey Monkey

  • Advanced Inquiry Systems

  • Vulcan Power


3. Oregon is Not as Competitive as Needs to be to Attract Job-Creating Innovation

Senator Bruce Starr (Republican) didn’t hesitate when asked if Oregon had a sufficiently hospitable environment for innovation.  “No.”  Yet perhaps the most impassioned contribution came from Oregon State Treasurer Ted Wheeler (Democrat).  Here are 4 highlights from Treasurer Wheeler’s discussion:

  1. People are angry, afraid and unsure of what the future will bring economically.

  2. We need to take more risks to support innovation in Oregon.

  3. Tools in Oregon are currently inadequate for driving innovation.  There’s a huge fuding gap between early stage bootstrapping and larger growth capital, and this gap is widening.  It’s time to demand change, and State political leadership is looking for ideas.  Wheeler offered examples such as calling for the Oregon Investment Fund to better create jobs in Oregon or proposing the use of general fund capital to better drive innovation.

  4. Oregon must do more to attract investors, startups and innovators.  There must be fresh ways to drive public-private partnerships towards this goal.  Wheeler’s principal question was “how can Oregon multiply its development investments 2X, 5X, 10X or 100X with private capital?”


4.  Now is the Time for Change

Following elections and political shake-up, now is the time for change.  That will require leadership not just from Salem, but from local business leaders who are passionate (mad as hell) about stimulating innovation, investment and job-creation in Oregon.


The time also couldn’t be more dire.  While the recession supposedly ended in June of 2009, any entrepreneur will attest to the lingering damage and challenges that persist for startups on the ground.  Meanwhile the Oregon Growth Account has committed almost all of its $150M, with only $12M remaining (most of which has already been pre-committed).  Unemployment in Oregon remains over 10% (at least), state business taxes remain high and Oregon is squarely in the middle of the pack (#24) in terms of national per capita income (below Minnesota, Wyoming and Rhode Island… if you’re curious).


Summary

To better attract economy-stimulating innovation, Oregon must create a more hospitable entrepreneurship and investment climate.  That being the case, there may be cautiously optimistic signs of progress.  More deals are getting done.  Politicians have their ears open for suggestions.  Entrepreneurs are mad as hell.


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