FROM THE PRESIDENT ...

Venture capitalists bet a record $12 billion on young companies last year as an unprecedented level of investment money from pension funds and other institutions flowed into the venture industry.

The surge in venture investment represents a 16% increase from 1996, itself a record year when such financing rose 42%, according to VentureOne Corp., a San Francisco research firm. California companies received $4.5 billion in venture investment last year followed by Massachusetts at $1.2 billion invested and Texas where businesses received $808 million in venture funding.

Although California and especially the "Silicon Valley" is about 20 years ahead of the Midwest in terms of creating a cooperative environment for new company creation, our region has made significant strides in both raising the level of available venture capital, as well as creating the nurturing business environment so necessary for new business formation and growth.

For example, Cincinnati had no venture capital funds in 1990 and according to Jack Wyant, president of Blue Chip Venture Company, the region more than doubled the amount of venture capital available in 1997 over the prior year, with $250 million split among four venture capital firms.

The availability of venture funds also increased in both Cleveland and Columbus. Morganthaler Ventures, the mega venture capital firm in Cleveland, said it expects to raise $200 million with its next investment fund, 47% more money than a previous partnership that nearly doubled the size of its predecessor. Also Tim Biro, with the support of the Cleveland business community, formed the $11.2 million Ohio Innovation Fund to help fill the critical gap for seed and early-stage funding.

Prior to the silicon chip that region of the country that has become synonymous with such familiar names as Intel, Silicon Graphics, Netscape, and Yahoo was simply known as the Santa Clara Valley.

Since the emergence of the chip and the personal computer that houses it the Silicon Valley has become something more than a location or even a destination. It has evolved into a selfperpetuating social structure.

The original entrepreneurial engineers that now represent the "old money" are looking to invest their time, their experience, and yes a portion of their twenty or thirty million dollars in these new generation thinkers, striving to become king of the hill.

The creators of the existing technologies must have known all along that just as they over took the status quo of their day that younger people and newer technologies would soon over take them.

It would appear that semi retirement does not sit well with these individuals. They are the ones who are perpetuating the spirit of the Silicon Valley and supporting its second generation.

Just as Jim Clark felt the need to leave Stanford to form Silicon Graphics, and then move on to founding Netscape, these other lesser known yet wealthy engineers have an appetite for supporting new ideas and creating new wealth.

"The Valley is a system of planned innovation: ever more rapid change brought about by people designed for the task. The message is simple; Invent something! Start Something! For God's sake man, the world is getting better! Look for something new to do!"