Technology
Challenged techies network hard to keep the sector moving ahead
Charlotte Business Journal - by Jen Zoghby
Good news
Tough times make for strange alliances. And that made for the best news in the troubled technology sector.
This year, as the sector struggled, several entrepreneurial networking groups closed ranks and consolidated membership.
Many leaders promoted one central meeting point for entrepreneurs. They were also encouraged by the easier grab for event sponsors — a tough sell in a tight economy.
In October, the Metrolina Entrepreneurial Council merged with Charlotte Convergence, an informal monthly networking group. That move came after the MEC considered a merger with the Ben Craig Center, a small business incubator at UNC Charlotte.
When the deal between the MEC and the Ben Craig Center didn't work, the MEC searched for another partner. MEC Executive Director Lori Antoniak says her board members mentioned Charlotte Convergence as a possibility because several Charlotte Convergence leaders had moved on to other non-technology fields.
Scott Mehler, now an insurance executive, started Charlotte Convergence in September 2000.
Charlotte Convergence was, at the time, an answer to another powerful networking group, FirstRound.org. That group, which was started by Jim Roberts, went through its own set of changes this year. Roberts took a job in Asheville at the Mountain Council for Economic Development.
The MEC honored Roberts in November and offered FirstRound.org members a reduced membership rate.
Antoniak says the group's outreach and consolidation helped it overcome a summer slump, when membership dipped to 400. Now, the MEC has 450 on its membership rolls, she says. "The consolidation has been what the MEC has needed for a couple of years," she says.
Ashe Lockhart, a Womble Carlyle Sandridge & Rice attorney and MEC board member, says the MEC's moves have made it a stronger organization and helped blend the best of the newer groups into a steady infrastructure. "It was a fractured community," he says.
While the MEC made its moves, the Charlotte Chamber's technology group has seen a spike in its membership, says Cherryl Pressley incoming chairwoman of Information Technology Charlotte.
That group changed its name and its logo this spring from the Information Technologies Council in order to focus on its location and its mission.
Also, Pressley and other ITC leaders reached out to chief information officers across the community, holding, special forums suited to their interests.
Bad news Entrepreneurs and investors see little light in long tech tunnel
The technology tunnel stretched on this year, with very little light to be seen.
Far from the late-1990s glory days, this year remained miserable for technology companies. Local businesses didn't blossom as fast as they might have under a sunnier economic sky.
Sales were slow and venture capital was hard to come by.
Charlotte added new angel investment groups this year, but they were barely getting started before the cold winds of the fourth quarter and the holiday season halted deals.
Overall, the once-roaring venture capital market continued to sputter. For the first six months of the year, venture capital investment across the state was 90% lower than its high in 2000, down to $195.6 million from the high of $1.9 billion. "The angel investor is probably Visa or MasterCard this year," says Joan Myers, who leads the N.C. Electronics and Information Technology Association in Raleigh.
Peak 10 Inc. Chief Executive David Jones had a measure of success this year as his data-center and managed services company expanded into Tampa and the Research Triangle. While the 2002 additions were on a much slower pace than Jones' original business plan, he was still glad to get the new centers online. One bonus was that Peak 10 moved into data-center space vacated by companies that hadn't survived the turbulent economy.
Despite its expansion, Peak 10 struggled to close deals with clients and had to suffer through longer decision-making periods from anxious customers.
Other Charlotte companies had to change the way they did business. At Cydecor, a local Web development and software firm, leader Nader Elguindi moved his operation to a smaller office and sent some workers to home offices.
He says it's been a tough year because there is a lack of purchasing confidence. Plus, people are concerned about timing their purchasing decisions to take advantage of the greatest upswing.
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