Experts offer tips on starting a business at area event
Published: Friday, January 19, 2007 at 6:01 a.m.
Last Modified: Thursday, January 18, 2007 at 11:11 p.m.
The technical research industry in Gainesville today resembles North Carolina's Research Triangle of 15 years ago, according to Jane Muir of the University of Florida's Office of Technology Licensing.
To that end, UF and several business organizations brought in two of the people who have worked for numerous technical startups in North Carolina to address about 50 people at the Gainesville Technology Enterprise Center on Thursday.
The purpose also was to bring together people who can form the kind of partnerships that lead to local companies, Muir said, with biotech professionals, investors, researchers and entrepreneurs on hand.
Lawyer Fred Hutchison and accountant Tim Gupton discussed the finer points of negotiating investment deals at the Entrepreneurs Roundtable.
"When you start a business, you can't worry about, 'can I do it?' or 'do I have the money?'" Hutchison said. "The ones that succeed, it's because of their perseverance."
Hutchison advises startups seeking investment money on how to avoid the expensive and time-consuming process of having to register public securities. Companies can solicit investors who can withstand the risk and not publicly advertise for capital. He cautioned Gainesville's burgeoning biotech industry that many biotech companies that offered public stock have not gotten the price they had wanted and wish they hadn't gone public. Biotech companies are also facing outrageous costs in protecting intellectual property, he said.
Hutchison advises companies to incorporate in Delaware because its business laws have become the national standard that are easy for investors to understand.
Gupton said venture capital investing peaked in 2000 before taking a dramatic dip — largely from the dot.com bust — during the next two years and are slowly edging upward again. With less money to invest, not as many new companies are being funded.
In addition to venture capitalists, startups can also draw from "angel" investors, individual investors with money to invest in early-stage or startup companies and assume a greater risk. Gupton said there are fewer angel investors since many are also wary of taking chances after the dot.com bust.
"This is the hard part, the early money."
Venture capitalists want more assurances for payout.
Asked if companies with the creator of the technology as CEO get venture capital, Gupton said "very few." He said husband and wife teams also don't get funded.
Anthony Clark can be reached at firstname.lastname@example.org or (352) 374-5094.
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