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Greenville News: Venture capital key to state's economy

Submitted by: John Warner on Apr 02, 2009 at 9:38 am Tagged with: Innovation, Venture Capital Source: Greenville News

Originally published in the Greenville News

South Carolina needs economic development efforts like the privately organized InnoVenture venture capital conference.

The conference, held last week at the Carolina First Center, is a first-class effort at producing more knowledge-economy jobs in the Upstate and throughout South Carolina. Real fruit has come from InnoVenture, now in its sixth year. And it's much-needed fruit, especially as the nation is in the throes of the longest recession since the Great Depression.

It's no secret that South Carolina lags in venture capital investment. According to the MoneyTree report by PriceWaterhouseCoopers, South Carolina saw just $26 million in venture capital investment in 2008. By comparison, our two neighboring states, Georgia and North Carolina, attracted $427 million and $459 million, respectively. All states were down considerably from 2007, but that's not surprising given the struggling economy.

This disparity is extreme, to be sure. It's also a very real manifestation of the relative weakness of South Carolina's high-tech economy, though that economy has improved dramatically in recent years. Hence the need for efforts like InnoVenture.

Venture capital is critical to start-up businesses, particularly in the technology field. Venture capitalists are investors who are seeking to invest in start-up and fledgling companies hoping for a return on their investment down the road. Among the success stories of InnoVenture is Selah Technologies, a local firm that has licensed technology it saw presented at a previous InnoVenture conference.

As John Warner, the brain behind InnoVenture, said in a recent op-ed on this editorial page, InnoVenture provides the ability for enterprising business people in the Upstate to see what's "next."

Some of the projects and ideas presented will not bear fruit tomorrow or the next day, but several years into the future. But it's essential that those ideas are heard and the seeds are sown today for potential investors and collaborators. That's how InnoVenture works.

This year there were presentations from 15 entrepreneurs from the region who showcased the best of ideas that are originating in the Southeast United States. Nine of the presenters were from South Carolina, and the others from North Carolina or Tennessee.

According to a Greenville News report about 450 people attended this year's conference.

They were 450 people who understand that, especially in this economy, what comes next is critical to the economic health of this state. With their efforts and other efforts like InnoVenture, South Carolina can close the gap in venture capital investment in this state.