WTIA’s Ken Myer Aims to Get VC Views on Future, Not Past
Every quarter, we journalists do the national story about trends in venture capital investing. We slice and dice numbers that tell the narrative of where money went over the past three months. Less than a year ago, Ken Myer and the folks at the Washington Technology Industry Association thought they’d try something different: a survey of local venture capitalists that attempts to measure their sense about where things are headed in the near future for venture-backed companies.
“We thought it would be intriguing to provide entrepreneurs, and even other VCs, a view that they haven’t seen before,” says Myer, the president and CEO of the WTIA, in a meeting yesterday at a local Starbucks near our offices on First Hill.
The third installment of this quarterly survey didn’t provide any shocking revelations last week. About a dozen Washington state VC firms have agreed to participate, and are granted anonymity to encourage candor. The consensus is they are worried that a national economic downturn will start to harm sales at their portfolio companies. In the inaugural two quarters, the VCs worried about something altogether different—the difficulty of recruiting and retaining talented workers.
Beneath the headline about economic angst, last week’s findings were a mixed bag. More than half of VCs surveyed predict their portfolio companies will have a 10 percent increase in their workforce in the third quarter. The number of new financings will probably be flat or slightly down in the third quarter, but that has a lot to do with this being a traditionally slow season, when VCs tend to head out on vacation, Myer says.
It’s too early to draw trend lines with only three quarters’ worth of data in the bank, or to see how the VC predictions match up with what actually happens in the quarters to come. That’s something I’ll want to ask about in the future, so we can judge whether this survey is a reliable predictor of behavior.
Myer also described some interesting changes he has pushed for at the organization since he took the top job in December 2006. The moves include:
—The name change from Washington Software Alliance to Washington Technology Industry Association in February. The organization means to include five primary industries—software, web services, telecommunications, digital media, and advanced manufacturing. The last part can include high-tech medical device companies, like defibrillator maker Physio-Control in Redmond. The WTIA recruited Physio CEO Brian Webster to its board as part of that outreach, Myer says.
—A younger generation of entrepreneurs have been recruited to the board, including Paul Thelen of Big Fish Games, James Sun of Zoodango, and Keith Smith of Zango. “We’re trying to make sure we’re relevant,” Myer says.
—The organization, which has 1,000 members representing 125,000 employees, has beefed up its services to startups. It has offered a bulk purchasing group for health insurance for a while, and now offers 401(k) plans, human resources contracting services, and corporate travel discounts to its members. Another idea in the works is a Web-based marketplace where members can sell stuff to other members. “We want to be a one-stop shop for discounts and services for our members,” Myer says.