Venture capitalists and angel investors mingled with tech entrepreneurs Thursday in Charlotte, as they looked for the next big idea at the Southeast Venture Conference.
The conference is largest of its kind in the Southeast, and organizers said it was remarkable to land such an event in Charlotte – a city known for its buttoned-down corporate culture, not the jeans-and-flip-flops of the startup landscape.
More than 600 entrepreneurs and investors attended the gathering at the Ritz Carlton.
“Charlotte is an emerging tech scene,” said Scott Hedrick, executive director of the Southeast Venture Conference. “And a lot of these folks haven’t been to the Charlotte area before. Getting them (here) and ready to see the kind of talent that’s available makes it that much easier for them, the next time, to jump on a plane and make the short trip.”
The conference is designed to showcase some of the most promising tech startups in the Southeast, most of which have annual revenues of about $6 million.
Fifteen of the 50 companies selected to present to investors were local – a large percentage, considering the event was hosted in Charlotte for the first time in its seven-year history.
Previous conferences have gone to bigger startup hubs, such as Washington, D.C., Atlanta and Raleigh.
This year, more than 80 venture capital firms with a total of $50 billion under management were represented at the conference, Hedrick said. They hailed from the Southeast and from Boston, New York, Silicon Valley, Denver and Chicago.
Christian Bullitt of LLR Partners, a firm with $2 billion under management, traveled from Philadelphia for the conference so he could scope out emerging companies.
And though he’s long seen Charlotte as a leading “deal community” because of its bank heritage, Bullitt says he’s begun to notice the city for its startup community as well.
Bullitt, who says his firm can write a $20-$60 million equity check, now flies to Charlotte a half-dozen times a year.
The interest from venture capitalists like Bullitt is a testament to the growth of Charlotte’s tightly knit entrepreneurial community, which began to flourish during the financial meltdown and widespread layoffs in the financial sector.
The city’s business landscape is drastically different than it was four or five years ago.
Terry Cox is the founder of Business Innovation Growth (known as BIG), a nonprofit that works with high-growth startups in the Charlotte area. Two years ago, she counted only a handful of high-growth local startups. Now she knows of more than 200.
Jim Van Fleet, who founded and runs a local web-app consulting firm called “It’s Bspoke,” is a key player in the local startup community. He says it’s great that Charlotte was in the spotlight this week during the conference.
But to sustain that attention from the national venture community, Van Fleet adds, “Charlotte has to step up.”
One success story
Historically, most of the presenting companies raise capital at the event and some see a significant bump in investment. Charlotte startup leaders hope this year is no different.
Daily deal site LivingSocial, headquartered in Washington, D.C., is one of the conference’s biggest success stories.
One of LivingSocial’s first investors, Don Rainey of venture capital firm GroVenture, recently decided to move his family from Washington, D.C., to Cornelius because of the potential he sees in Charlotte’s entrepreneurial community.
“I’m a moth and that’s the light I’m attracted to, the evolution of a (start-up) ecosystem,” said Rainey.
But to become a real powerhouse startup community that attracts major venture capital, Charlotte is going to need many more investors like Rainey and Bullitt to take an interest in the area.
North Carolina currently ranks 19th in 2012 for overall venture investment with $169 million, according to data from the National Venture Capital Association. (In comparison, California, the No. 1 state for venture capital investment, laid claim to $14.1 billion.)
Currently only two private equity firms headquartered in Charlotte – Frontier Capital and Falfurrias Capital – made investments last year, says Emily Mendell, spokeswoman for the National Venture Capital Association.
But the amount of investment capital in North Carolina that’s from the state has increased in the last two years. In 2010, only 11 percent of the state’s venture capital came from within. Now, 25 percent does, Mendell says.
But events like the Southeast Venture Conference in Charlotte, and the attention from investors they bring, could be pivotal to the success of Charlotte’s startups, Cox says. And that success is crucial for retaining talent.
“That’s why Silicon Valley is so successful 50 years later,” Cox says. “You need successful entrepreneurs to come back and invest and mentor.”














