Venture Atlanta Day 1 by John Yates, Chair – Technology Group, Morris, Manning & Martin, LLP
The first day of Venture Atlanta was perfect – great turnout of VCs, angels and local entrepreneurs on a beautiful Atlanta day.
And, the venture investor dinner on the Metro Atlanta Chamber’s terrace overlooking downtown was the premium investor networking event of the year in the southeast.
The overall mood on Day 1 was cautiously optimistic – with an improved economy, VCs are more seriously looking to invest in southeastern tech companies. And, metro Atlanta remains a hub of the region’s entrepreneurial growth.
Discussions with venture capital attendees and presenting company executives tell the tale — entrepreneurs are realistic about the challenges in raising capital but remain optimistic they’ll find a suitable venture partner interested in their technology and market. Venture capitalists have selectively narrowed their scope of concentration and are interested in recurring revenue companies with a broad customer base and experienced management.
As expected, the presenting companies at Venture Atlanta are interested in funding — but only at the right valuation. Several have obtained angel financing and are waiting for more favorable valuations as market conditions improve.
On the venture fund side, several VCs commented on the improved attendance from last year (recall this is the first anniversary of the 2008-09 recession).
Other observations from Day 1 include:
- As expected, the East Coast venture funds were well represented, with limited participation by Silicon Valley funds.
- The few West Coast funds in attendance, however, were well prepared and have scheduled meetings with companies and CIOs from Atlanta — developing important contacts for their portfolio companies.
- The main investment themes continue to center around SaaS, recurring revenue, broad (as opposed to concentrated) customer markets, and proven technologies (versus R&D businesses).
- Venture funds expressed a greater interest in participating in follow-on rounds for promising companies where the technology risk has been overcome.
- Angel investors were present but often quiet in their consideration of companies (hopeful to find the interesting companies without being inundated by every start up entrepreneur walking the floor).
- Companies seeking “growth capital” (revenues of $10million or more and EBITDA positive) remain the VCs favorite – especially if the company hasn’t already raised institutional financing.
Day 2 should shed interesting light on the high quality of presenting companies – and the appetite of venture funds for earlier stage business opportunities.
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Editor’s Note:
John Yates is the chair of the Technology Group at Morris, Manning & Martin, LLP with offices in Atlanta, RTP, and Washington D.C. He is an internationally recognized technology attorney considered a pioneer in technology law and has practiced exclusively in this area for over 27 years.
About Morris, Manning & Martin, LLP
Morris, Manning & Martin, LLP is a full-service commercial law firm representing leading entrepreneurial and global companies. Its Technology Group has represented hundreds of technology companies and provided legal services for venture capital funding, IPOs, mergers and acquisitions, corporate finance, intellectual property prosecutions, Internet and international law. The firm is nationally prominent in these areas and in its environmental, green technology, healthcare, insurance, litigation, and real estate practices, as well. Disclaimer
