When the City of Davenport submitted its application for Vision Iowa funds, one project was called the AgTech Venture Capital Center. Now it's known as the New Ventures Initiative, and the concept has been expanded: It will become a full-service development center for emerging technologies.

Technically, the old name no longer applies - the mission has expanded beyond agricultural technology, and venture capital has been replaced as a focus by "angel" investors - but the gist is the same. The organization, a not-for-profit subsidiary of DavenportOne, plans to shepherd ideas from the business-plan stage to reality.

The organization got its leader last week when DavenportOne introduced David Abbott as the new executive vice president of the New Ventures Initiative. Abbott has more than 25 years of experience in technology research and evaluation, new-product development and marketing, and new-business development. He will be working out of the DavenportOne office until the organization's permanent home, at Third and Ripley streets, opens in June 2004. Groundbreaking is scheduled for October.

The premise of the New Ventures Initiative is that a lot of businesses need help getting off the ground, both in terms of financing and expertise. Dan Huber, president and CEO of DavenportOne, called the New Ventures Initiative a "one-stop location for higher-tech companies ... to get an array of assistance" and a "business-development pipeline." He added that the center will be "a little like your local gym. We're going to get your business plan physically fit."

And at that point, businesses will be in a good position to secure financing. "Our intent is to get companies ready to go to them [investors]," said Kathy Evert, DavenportOne's senior vice president of economic development.

Those investors will already be in the community, DavenportOne hopes. The New Ventures Initiative wants to develop a Quad Cities "angel investment group" - individuals who want to invest in promising startup companies. "That's a critical piece, to have a group of local investors who we can rely on and who can rely on us," Huber said.

"Our contacts within the investment community in eastern Iowa and western Illinois will provide initial links to angel investors," Abbott wrote in an e-mail message. While the New Ventures Initiative will connect investors and new businesses, it will not be brokering deals; that's up to the businesses and investors.

The ultimate goal of New Ventures is to create a regional business-development center that will foster economic growth in the Quad Cities and surrounding areas. The hope is that high-tech companies - those specializing in new products, or new ways to manufacture goods or process agricultural products - will make their homes in western Illinois and eastern Iowa.

"We're positioning this as a much larger regional initiative," Evert said. "We knew there was a lack of an entrepreneurial climate and access to capital."

"This is not a magic bullet," Huber said, "but we've got to start on this journey. We've got to do the hard work of getting companies into business." Both Illinois and Iowa have started venture-capital funds, but they might not have projects to fund without something such as the New Ventures Initiative to help businesses get started. "We're the ones who determine whether those funds have anything to work with," Huber said.

Abbott said he's ready to start work. He already has more than 10 business plans to consider. "People think we have money ... or that we can get it for them," Evert said.

But discussion about business plans is a little premature. The New Ventures Initiative doesn't yet have a board or any policies in place.

The board of directors will be drawn from western Illinois and eastern Iowa, although boundaries have yet to be determined. The first meeting of the board, which will be chosen by DavenportOne and will likely have more than 20 members, is tentatively scheduled for August 27.

The New Ventures Initiative will certainly have the DavenportOne stamp on it, even though it's a separate not-for-profit organization. Abbott and his staff member will remain employees of DavenportOne, and the D1 Initiative has committed $500,000 to New Ventures Initiative's operations. In addition, DavenportOne staff might assist businesses in fine-tuning their plans. For example, Evert is also executive director of the organization that runs the Eastern Iowa Industrial Center and could provide expertise on industrial parks. "We have the resources of DavenportOne at our disposal," Abbott said.

The DavenportOne Foundation will purchase the first floor of the 40,000-square-foot building from developer Kaizen using Vision Iowa, city, and county money. That makes the New Ventures Initiative in some ways a public trust, even though it's run by a private organization.

The New Ventures Initiative won't be the only first-floor tenant. The building's first floor will include roughly 10 spots for below-market-value "incubator" office space for startup companies. "All our services are intended to be below market value," Abbott said. "That's intended as a support mechanism in the startup phase." (The second floor of the building will house private companies.)

And Scott Community College's Small Business Development Center helps startups write business plans and will also move into the first floor. "I think we'll work together," said Ann Hutchinson, who took over the Small Business Development Center earlier this month. "It's a good partnership."

If a person or business has an idea, the Small Business Development Center can help develop the business plan. The New Ventures Initiative can then help refine certain types business plans and connect businesses to possible angel investors.

The next level of funding is venture capital, and for that companies could go to Davenport-based Great River Capital. That company, which plans to open an office in the Redstone building in September, is a venture between Germany-based Dresdner Bank and local investors. It plans to have a $100-million venture-capital fund to finance businesses that have gotten past the "angel" stage. In that way, Davenport could be a one-stop shop for young businesses working in new technologies, with the New Venture Initiative leading to angel investors and then to Great River Capital.

The New Ventures Initiative is modeled primarily on the Oklahoma Technology Commercialization Center (OTCC), a statewide initiative that opened its doors in 1997. That model looks at a business plan through six phases - investigation, feasibility, planning, introduction, full-scale production, and maturity - and at each level considers technical, market, and business components. DavenportOne representatives visited the OTCC for a day this past spring.

Greg Main, president and CEO of the OTCC, said that the center has been fully operational for four years. Of the 930 companies or individuals that made inquiries during that time, 360 engaged in some commercialization activities with OTCC. Main said 26 percent of those business plans have gotten funding from angel investors or venture capitalists.

Abbott described the likely process for the New Ventures Initiative in a way that suggested levels of schooling. At the end of each phase, New Ventures Initiatives staff ask a series of questions - including something as basic at the outset as, "Is there a market for this product?" - whose answers determine whether the business plan "graduates" to the next level. Main said that in Oklahoma, the business plan is given a numerical score at the end of most phases. Still, he said, "there's some subjectivity."

At each phase, businesses will have access to whatever expertise they need, either from within the organization or outside of it through referral. For example, Abbott's background as senior vice president of business development at Muscatine's Grain Processing Corporation is in the areas of business development and intellectual property.

But the organization won't be supporting ideas and plans it doesn't think are feasible. One lesson Abbott said he's learned is that "you need to make hard recommendations early. You're in the position of telling them their baby is ugly." Those decisions will be made at the intake level by Abbott's staff member, while Abbott will be involved more at the end of the process. For every 100 businesses that the New Ventures Initiative investigates and agrees to help, Abbott said, perhaps only five or 10 will "graduate" from the program, ready for investors.

Those investors will likely be "angel" investors rather than venture capitalists. When the Vision Iowa application was submitted, "we had an emphasis more on the venture-capital aspect," Evert said. What she found was that there's a step between final business plan and venture capital, and that's angel investors. Angel investors are usually individuals or groups of individuals, and they typically fund companies "at an earlier stage of business" than venture-capital groups, Evert said. "That's where most startup businesses fall into the valley of death," because they don't have enough capital at the start, instead depleting personal resources such as credit cards and savings.

The concept articulated in the Vision Iowa application was also limited to agricultural technology and the emerging "green economy" - using renewable resources such as corn and soybeans to create new products. Expanding the concept to include other types of technology, including new manufacturing technologies or proprietary software, allows for more funding possibilities, including additional state and federal grants and loan programs.

One of the charges of the new board will be setting procedures and goals. The New Ventures Initiative will likely set targets for the amount of money leveraged, and eventually the number of jobs created. "We have not at this point set numerical goals," Abbott said.

He also said the New Ventures Initiative will give companies plenty of flexibility and won't restrict what they can do once they're done with the program.

Businesses that go through the New Ventures Initiative aren't bound to seek funding from investors with whom the organization has relationships. "That's at their discretion," Abbott said. "We'll give them advice, but we don't have any governing authority."

Similarly, the New Ventures Initiative doesn't automatically have any stake in the businesses that "graduate." But "we have the ability to be an investor ourselves," Abbott said. A business can negotiate with the Initiative for an investment stake in lieu of a cash payment from the business for services or rent. "This is not a gimmick where we have a first right," he added.

"Our goal is to have successful ventures out of this," Abbott said. "We want to be mentors, not gatekeepers."

The ultimate goal is for the New Ventures Initiative to produce quality business plans that are attractive to angel investors. If it can build a solid record of performance, that will make the road easier for future businesses that emerge from the program. "We want the venture-capital community to identify us as a source of good ideas to hear out," Evert said.

For more information about the Oklahoma Technology Commercialization Center model, visit (http://www.otcc.org).

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