Is Venture Capital broken? The Venture Alliance thinks so

Newport Beach, CA- In 2003, fewer than 2,300 companies out of 75,000 searching for funds actually received venture capital investment. This does not bode well for you if you are an entrepreneur. “Most entrepreneurs, lack the contacts needed to get in front of Venture Capitalists that can give you the funding your company needs,” says Jim Casparie CEO of The Venture Alliance (TVA). “TVA’s mission is to get good companies the funding that they normally would never be able to get on their own,” continues Casparie. If the prevailing trend continues, things are going to get even rougher for the entrepreneur looking to fund his startup. Nationwide, venture investing peaked in 2000, with more than 7,800 deals for a total of $105 billion, according to the National Venture Capital Association. Since the dot-com stock market bubble burst, however, venture investment has declined dramatically - 2004 saw only $21 billion invested in fewer than 2,900 deals.

TVA represents a nationwide group of professional investors, and venture capital funds representing over $4 Billion in capital that got together to increase their deal flow. “Most entrepreneurs can't even get a meeting with the money folks,” says Elliot Reiff, TVA’s COO. “Venture capitalists don't read 80 percent of the business plans they receive and fund fewer than one in a hundred,” concludes Reiff.

How successful has TVA’s new approach been so far? If the $76 million brought to TVA clients in 2004 is any indication, their approach could pull the Venture Capital world into the 21st century.