CICP News & Updates

According to Reuters and the National Venture Capital Association, just one venture-backed company made the IPO leap in the third quarter of 2008, and merger and acquisition activity is also down more than 40% from the same time last year.

This is one more piece of bad economic news, but it is especially relevant to states like Indiana, where we are making progress building an entrepreneurial economy in an area traditionally underserved by venture capital investment.  For venture capitalists, the IPO or merger/acquisition is typically the time to exit an investment and realize their profit.  If money is tied up in companies that are delaying their IPOs, it means fewer resources to be focused on earlier-stage start-ups.  Indiana could be hard-hit by this trend – even though we’ve made tremendous progress in venture capital attraction, Hoosier start-ups still face a tough competition with high-tech and life sciences companies on the coasts.

Fortunately, we’re working to develop our own homegrown sources of equity financing for Indiana start-ups.  A group of successful Indiana entrepreneurs (several of whom are CICP and TechPoint members, led by Mark Hill and David Becker) recently formed HALO (Hoosier Angels Looking for Opportunities), an angel investment network focused on new ventures in the state. 

HALO offers capital in the general range of $250,000 to $2 million to high-potential start-ups, along with management expertise.  The group has entered into a contract with CICP’s TechPoint initiative to help identify and perform due diligence on the most promising opportunities.

More and more angels are banding together in networks like HALO, with more than 300 active groups in the U.S. registered with the Angel Capital Association.  For individual investors, these groups are a way to evaluate more deals, share risk, and make a bigger impact by bundling investments. HALO investors have committed nearly $7 million to five entrepreneurial companies at this writing.  And as HALO demonstrates continued success, TechPoint may begin to explore the potential for regional networks in other parts of the state.  It’s a promising strategy for keeping the entrepreneurial pipeline going in Indiana, even with tough national investment trends, and continuing to diversify our economy.

Learn more about HALO here.