Investors in Jacksonville are focusing too much on unicorn companies, celebrity entrepreneurs and meaningless anecdotes instead of actual initiatives and programs that are proven to create a successful entrepreneurial ecosystem, a crowd of funders and entrepreneurs were told during the open day of the inaugural Jacksonville Venture Competition.
"Knowing what Elon Musk ate for breakfast or what Bill Gates likes to read or Jeff Bezos' workout routine is meaningless," Jacksonville University professor Jim Simak said Tuesday. "It's mostly revisionist history and marketing speak, which is ultimately useless."
The event, which coincided with angel investor network VentureSouth launching a chapter in Jacksonville, featured a variety of speakers from academia, the world of finance and more. The event will culminate in a pitch competition Wednesday in which five companies — including three from Jacksonville — will face off in an effort to secure up to $1 million in venture funding.
The goal, organizers said, is to help build an ecosystem of startups and funders, helping drive economic growth.
Jacksonville is poised to do that, said venture funder Jim Stallings, founder of PS27, one of the biggest funders on the First Coast. "I think this is so timely, so important to our city — to our region, to our state," Stallings said about the conference. "There's a wave of innovation happening, and it needs to get capitalized."
While Jacksonville has the universities and the industries needed to build an ecosystem, it's missing the capital piece: While $6.8 billion in venture funding was deployed in Florida last year, according to the Florida Venture Forum, Jacksonville wasn't even listed in the organization's report.
"We're woefully undercapitalized," Stallings said. "We need a lot more."
In building an ecosystem, Simak said, hype, superstition and anecdotes too often rules the day. What actually moves the needle, he said: Focusing investments on high-growth companies that see north of 20% growth for three consecutive years, Main Street small businesses that can operate and succeed for at least five years and education.
For startups, the focus has to be on things like having a skilled management team, said Trish Skoglund, corporate director of mergers and acquisitions at Crowley, one of several corporate venture funds growing more active on the First Coast.
Echoing Skoglund's statements, Julie Larossi, clinical assistant professor with the Darla Moore School of Business at the University of South Carolina, added that proving you are experienced in business management is key to your success in acquiring funds. She said, simply knowing geographic and local ecosystem trends can take you a long way to securing funding from regional venture capital funds.
Going one step further, Janet Wylie, a serial tech entrepreneur, said it isn't just forecasting numbers that coincide with realities in geographic markets it's proving you are able to actually achieve your financial goals.
The venture capital portion of the panels ended with Don Capener, dean of continuing education at Utah Valley University and a consultant for Jacksonville-based Chang Industrial, as he discussed raising funds in turbulent economic times.
He began by pointing out that although valuations remain high for companies, the number of investment deals have begun to plummet during the current economic conditions. He said it is even more important for a company seeking investment to not only have customers but to able to tell a cohesive story about their success and growth trajectory based on reliable and accurate data.
"Having 'anecdotal data' just doesn't cut it now," he said.
The Jacksonville Venture Competition continues Wednesday with a focus on infrastructure and fundraising, as well as the pitch competition. The entire event can be watched live on the First Coast Inno website.
