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September 23, 2009

Startups have it tough right now

If you want to get a sense of how startups are doing in the Mid-Atlantic region, the story is behind this chart on the right, which gives it to you in a nut shell: Venture capital investment is down, waaaaaaaay down. venturemoney.jpg And that has the effect of putting a damper on early stage investments that angels are making (or not making) in promising young startups. It's a trickle-down effect...and it's a drought, not a storm, of capital.

I wrote a story about this phenomenon today. Check it out here.

Times are tough out there for the poor startup. Entrepreneurs are knocking on doors, looking for angel investors and being turned away. About the only small companies that seem to get a little traction out there, generally, are biotech companies -- which benefit from a generous investment tax credit from the state of Maryland.

Banks are still tight with credit and lending. One angel investor told me of how a friend in banking refers entrepreneurs to him because the banker can't do anything for them.

What do you think is going on out there? Any startups wish to give us a first-person account?


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
Posted by Gus Sentementes at 8:00 AM | | Comments (1)
Categories: Startups
        

Comments

Gus,

Thanks for the quotes and coverage, we can use all the PR we can get.

I think these days it takes more than a good idea, a good product, and strong management to get funding. Investors are looking for a sure thing in a business where there is no such thing as a sure thing.

Also, I think in a town like Baltimore there needs to be a concerted effort to invest in technology startups. The truth is all of the good talent leaves town for funding, jobs, and opportunities. This hurts everyone. We need to find ways to keep companies and smart people in Baltimore.

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About Gus G. Sentementes
Gus G. Sentementes (@gussent on Twitter) has been writing for The Baltimore Sun since 2000. He's covered real estate, business, prisons, and suburban and Baltimore City crime and cops. He was one of the first reporters at The Sun to use multimedia tools and Web applications -- a video camera, an iPhone -- to cover breaking news. He hopes to cover Maryland geeks and the gadgets and Web sites they build, and learn -- and share -- something new every day.

Gus has a wife, a young daughter and two feuding cats. They live in Northeast Baltimore.
This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
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