No, not money, just talk. Let's count the 'recent' venture financings in Montana.
1. Ligocyte Pharmaceuticals
2. Hmmm, Ok that's it.
Now, I have nothing against venture capitalist, some of my best friends ply that trade. But when I hear venture capital and Montana in the same sentence, I immediately get fired up. That's because I meet with too many entrepreneurs and read too many business plans that have venture financing in their hypothetical future. Many of these are just the naïve words of in-experienced entrepreneurs. Others result from a fundamental misunderstanding of business financing. These individuals need to understand some of the qualifications for venture financing. They need to ask themselves:
1. Do I have a track record of growing a company at a very fast pace (the eponymous 'Gazelle' company?)
2. Do I have a track record of returning shareholder value?
3. Do I have a track record in the current business of revenue and ideally, positive net income?
4. Does my product or service really have a competitive advantage?
5. Have I assembled a management and technical team of superior expertise?
These are just some of the initial qualifiers that 'get you in the door' of a venture capital shop. From there, the questions get more focused and quantifiable.
I see a company properly aligned for venture capital financing once every year - and it's not for a lack of looking. The lack of companies that meet these criteria in Montana is due to some obvious reasons. Population - at some level, it's a numbers game. We have less people in the State than in a matter of city blocks of Boston, San Jose or Austin. Research Universities - Two. That just pales in significance to popular venture capital centers. Successful, high growth, tech companies on their third or fourth generation of management - Three. I'll count Semitool, RightNow and Zoot. Even those are debatable.
Entrepreneurs complain about the lack of venture capital in the state. Venture capitalists cite the lack of entrepreneurs (under their definition) in Montana. I'll side with the latter but I'll also say that this is changing.