One high tech executive looked a bit disappointed after presenting a 20-minute pitch, which was designed to attract private investors for his company at the first ever Rhode Island Investment Forum. The look appeared when he asked if anyone had questions about the business, and there was silence in a room of about 40 people. A short while later, however, the same executive was spotted outside the Newport Doubletree Hotel conference room in deep conversation with someone who appeared to be a potential investor.
But that’s par for the course during a forum like this, according to Christopher D. Graham, a partner in the Providence law firm of Edwards & Angell.
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The June 4 forum was designed to showcase about 25 Rhode Island high tech businesses, which are in the early stages of development and seeking investments by private investors. It was sponsored by the Rhode Island Technology Council, the Rhode Island Economic Development Corp., and various businesses, including Edwards & Angell and Providence Business News.
Though no one asked questions during the question-and-answer segment of that presentation, Graham said some investors might prefer to maintain a low profile if they are actually interested in a company. Instead, representatives from venture capital firms and other private investors could decide only to talk with entrepreneurs after the presentation in a hallway or the lobby or even somewhere else over coffee.
”You never know who’s here; you just have to see how it all plays out,” Graham said.
”There are connections that get made sort of off-line, then there’s a discussion that ensues,” Graham said. “Very rarely does anybody bring a checkbook to an event like this and write out a check. And none of the entrepreneurs expects it.”
Graham said his firm, which does some investment work for both entrepreneurs and investors, sponsored the event because partners there feel there is a need to hook up high tech entrepreneurs with investors. “It will allow entrepreneurs with great ideas to have access to capital,” he explained.
”We think there’s a lot of creative effort going on in Rhode Island; it’s just a well-kept secret,” Graham said.
Giulio DeConti Jr. and Peter Lauro, who are both Rhode Islanders and partners with the Boston law firm of Lahive & Cockfield, agreed the Ocean State’s technology industry would benefit from the investment forum.
”I think they should be doing more of this,” Lauro said of the event. “I think if you don’t offer a forum for a showcase of this type of business, it leaves the state.”
Lahive & Cockfield was one of about a dozen companies to have a display at the venture forum. The law firm specializes in intellectual property rights and handles investment deals, which can mean either representing an entrepreneur or an investor during due diligence. The partners said they expect to open a Providence office by year’s end.
”Rhode Island wants to come across as a place where there’s a community of high tech business,” DeConti said.
Image, he said, is important in the technology industry because companies need to be located where they can interact with similar businesses and academic institutions. Boston’s reputation serves it well as a city “where you can have that intellectual exchange,” DeConti added.
”I’ve worked with venture capitalists who’ve moved a business for that reason,” he said.
Two-hundred-and-thirty-three people registered for the event, according to David Croston, the EDC official assigned to work with Rhode Island’s high tech industry. State officials hope to make the venture forum an annual event, according to Croston. The event also included a second track of programs, which highlighted research work being done at the Naval Undersea Warfare Center in Newport. NUWC’s program showcased work that is available to be developed for other industries.
”For a first-time event it was a resounding success,” Croston said. “To make it work we needed to bring down the firms from Boston – they came.”
A Maryland investment firm was also represented, as well as others from Connecticut, New York and Rhode Island, Croston added.
Thomas Mulhearn, RItech’s executive director, said he was “very happy (with the turnout) for a first time venture.”
A few of the companies that were originally scheduled to present, however, had to drop out of the event because “they started to finalize financing with venture firms” before the forum, Mulhearn explained.
There was a range of experience and expertise among those companies that did present. The lineup ran from start-up firm BlueStreak.com of Newport, which will be formally launched at a San Francisco convention this month, to Mesa Systems Guild, a Warwick company that was founded in 1990 and has already secured $1.7 million from investors. Mesa’s executives are now seeking a second round of financing.
BlueStreak.com has created a method to produce banner advertisements for the Internet, which are designed to intrigue browsers and get them to actually examine the ad’s contents. “Now people click on those banner ads less than one percent of the time,” said company President Annette Tonti during her presentation.
Among BlueStreak’s clients to date, Lycos, which is an Internet search engine company that commissioned an Academy Award-theme advertisement from the Newport company. The ads, Tonti said, come in different shapes and sizes and some can even enable a company to take orders immediately.
Tonti said her company already has some “private funding” from so-called angel investors in the Boston area, but is seeking additional financing.
