Small businesses find ways for deals

January 23, 2008 12:00:00 AM PST
All of the recent volatility in the U.S. economy has investors who typically fund start-ups, thinking more carefully about how they spend their money.

But that doesn't mean there's not money out there. One investor is willing to weather the ups and downs of the economy: the government.

Everyone at Indus Entrepreneurs event had the same Silicon Valley dream: to be the one who invents the next 'big thing' of 2008.

"We're trying to utilize the information in the genome, either DNA or RNA and try to predict the presence or absence of cancer," said entrepreneur Binay Panda.

It all requires big money backing, something everyone here wants.

"We don't have money, but we need money," said Panda.

That's why inventors came to this event looking for funding options. Most already unsuccessfully tried the venture capital route.

"When the economy is down, people are not so ready to open their wallets and put money into start ups," said Richard Helfrich from Alameda Capital LLC.

Venture capitalist Richard Helfrich says first phase start ups will likely suffer this year. Right now, VCs want low risk investments.

"All the Federal and many state departments have these small businesses out reach programs," said San Diego Research Center former president Lin McClure.

And that's where the government comes in.

Lin McClure talked about government funding as an option in this down economy.

The Feds fully funded her start up, which she eventually sold for $41 million dollars.

"The government is typically willing to spend a lot on technology, to get the right answer to a particular problem," said McClure.

It's called the Small Business Innovation Research program, where millions are available. It's a matter of finding the right fit.

"For example, if you're interested in developing something for homeland security, their Web site explains it all. The dates proposals are due are clearly listed, and they even have topics they're interested in funding.

Whether anyone in the Silicon Valley has what the government needs we'll find out soon enough.

The deadline to submit the next round of proposals is Friday.