Forum Focuses on Fostering Tech Start-Up Growth

Opportunities and challenges in elevating Central Oregon’s profile on the high-tech map were aired recently during a panel discussion featuring industry experts including successful local entrepreneurs and two Silicon Valley veterans.

The ever-increasing level of start-up activity in the region was the focus of the latest quarterly ‘Tech Forum’ – hosted by Bend Research CEO Rod Ray – which attracted around 100 attendees to the Riverhouse Convention Center.

The program was put together by Dino Vendetti, managing director of Seven Peaks Ventures – a new seed fund described as the previously “missing ingredient” of an organized form of available risk capital for stimulating local tech sector entrepreneurial activity.

Vendetti, who was also instrumental in forming start-up accelerator Founders Pad, is working on putting together a fund of some $15 million to support selected early stage enterprises, primarily focused on web-based and software companies.

Local representatives addressing the forum included Peter Ozolin, who heads Manzama – billed as the legal profession’s first “listening platform” aggregating online data for “actionable insights” – and who has built his company from a 2010 Bend Venture Conference backed start-up to one numbering half of the top 25 law firms in the U.S. among its clients, and reporting a 98 per cent renewal rate.

He was joined by fellow Bay Area transplant Josh Bryant, touted as a “serial entrepreneur” and founder/CEO of innovative new Bend-based online real-time file sharing company Droplr, which is fast garnering industry media attention, with progress being followed by major players after attracting 150,000 users in little over a year with almost no marketing exposure. Droplr has also received recent additional investment as the first funding recipient closed by Seven Peaks Ventures.

Rounding out the panel were guests Google Principal for Global Alliance Development Nishad Pai and Bret Waters, Founder/CEO of Tivix, a Bay Area-based leader in developing innovative custom web, cloud, and mobile applications.

Panelists agreed that the planned expansion of Oregon State University-Cascades Campus into a fully-fledged four year school was a major step forward for the region, especially with the announcement of a new computer science degree program – utilizing a curriculum developed with the help of industry exponents like Vendetti and Bryant – focusing on web and mobile applications and promising to nurture homegrown tech and computer talent.

Vendetti said the rationale behind organizing the forum was to focus on the sustainability of tech companies in the area and to flush out the associated issues, opportunities and challenges, adding that it was somewhat easier to get companies launched in this era but as difficult as ever to scale into big business.

He said: “Companies like Manzama and Droplr are the poster child for capital efficiency, and the kind of companies that proved the inspiration for this gathering. It is possible today to get companies to market first with a relatively low capital infusion, which is the kind of companies that investors typically like to invest in.”

When asked what makes somewhere like Silicon Valley a Mecca for start-ups and entrepreneurial activity, Pai added: “Places like the Bay Area, New York and Boston have great tech communities. They have that established ecosystem in place with available risk capital, a talented labor pool and a robust educational system.

“In Silicon Valley, the influence of the tech sector runs deep, with kids at an ever younger age getting excited about and involved in newer technology.

“For example, we had my daughter’s third grade class at Google, and they came up with these great creative ideas for driverless cars, which showed the value of unbiased imagination – and the company may even run with development of a couple of their suggestions(!)

“Such communities also have a long history of entrepreneurial culture, intrinsic in the Valley, with surrounding complimentary tech hubs also having evolved.”

On the question of how regional markets could tap into the tech boom, Waters said: “Physical location for start-ups matters less nowadays, especially in terms of online-based companies, but there have always been centers of innovation – usually at the confluence of capital, talent and universities.

“For entrepreneurs, I think a personal network is also most important, and somewhat easier to develop at events and venues such as this tech forum. Many successful people in Central Oregon have come here with an existing personal network.”

Regarding the ability to attract skilled employees to the region, Ozolin commented: “Engineering talent will find this place. In Silicon Valley, engineers can frequently be headhunted, which is not so good for the stability of the company losing such talent, so it may mean more workforce stability here.”

On the flip side, there was a perceived need to build the tech sector infrastructure locally as engineers “would rather change their job than their commute” and may be reticent about moving to an area like Central Oregon if there were fewer options to further their career in the future by switching to other companies.

Bryant commented: “Central Oregon is Central Oregon’s biggest asset. There are great opportunities for people in the area like me who are passionate about what they do and want a better quality of life.

“My commute in the Bay Area used to be over and hour and a half one way and I didn’t get to see my kids so much.

“I moved to Bend with confidence. It is also relatively easier to start up in a different geographic area now as technology has revolutionized how companies like ours can operate.”

Asked whether location enters into the equation when weighing up the risks of investing in a start-up in a regional market, Pai said: “Earning stripes in a particular market which has proved itself as entrepreneurial, and building that network leading to generating awareness of the region as a tech start-up hotbed is important as a kind of bridge strategy which can build credibility.

“What raises eyebrows as much as anything is success, which makes investors feel more assured regarding the chances in a particular geographic market.

“Many companies are competing for capital, so you have to have those successes and flagship companies leading the way.”

Vendetti observed that some of the fledgling companies enjoying success in Central Oregon were often “hyper-focused” on niche markets, and led by tenacious entrepreneurs, with Pai commenting that the collaborative and helpful atmosphere he had witnessed in the community (not unlike the burgeoning craft beer industry) was to be applauded, adding: “Build profitable, viable companies adding value and you will continue to attract interest.”

Waters commented that trends in Silicon Valley have changed regarding the way early stage venture capital is deployed. He said: “There used to be a small number of major investments, but now the trend is more towards a stealth approach with funds spread in smaller increments over a greater number of enterprises, especially those exemplifying lean capital efficiency.”

Bryant said he would also like to see an emphasis on education with a more “holistic” world view including bolstered technology instruction through the K-12 timeframe, potentially through changing class structures and utilizing online resources such as I-Tunes University (iTunes U) – a groundbreaking app that gives access to the world’s largest online catalog of free education content from leading institutions.

Ozolin added: “It’s not just about the talent base; it’s also about the quality of life and the educational system, and a more reasonable cost of living – all attributes that could add to the growing tech synergy in this area.”

Tech Forum is a quarterly event designed to bring together manufacturing and high technology company leaders in the tri-county area for networking and to learn about industry innovations, university research, and commercialization opportunities.