High tech comes to Sierra
The rumors are true: successful business people from California’s Silicon Valley have been moving to the North Shore. In fact, Jack Schwartz, self-proclaimed “Silicon Valley expatriate” said there are enough highly talented individuals to form a synergistic incubator for entrepreneurs: the Sierra High Technology Group.
Schwartz started the group in November, and it now has 50-plus members, he said. They have been meeting once a month at the Northwoods Clubhouse in Truckee, but will be meeting at the North Lake Tahoe Conference Center beginning in July because they’ve outgrown the conference room at Northwoods.
Some of the members are telecommuters who work for large companies, such as Cisco, Hewlett-Packard and TRW, Schwartz added. Others work out of their homes.
“Of the 50 or so members, there are 18 start-ups,” Schwartz said.
Members of the Sierra High Technology Group are not newcomers or novices.
“CEOs, company founders, programmers or system administrators – people with a lot of experience,” Schwartz said.
The monthly meetings provide valuable information to new businesses.
Major venture law firms, big-5 CPA firms, the Sierra Angels, and Tech Alliance of Reno all are involved with the Sierra High Technology Group.
The next meeting, tonight at 7 p.m. will feature a presentation by the Sierra Angels, a pre-venture capitalist funding organization.
In other words, this is a group of investors that funds start-ups before they are ready to apply for venture capitalist funding.
“It used to be that people would go to a venture capitalist and ask for one or two million dollars. These days twenty or thirty million is not uncommon,” said Schwartz.
At the height of the dot-com frenzy, venture capitalists would fund someone based just on an idea. Since the stock market changes in March, these days it’s much tougher. It requires a more polished business plan with more old-style business concepts in place. Not the least of which is forseeable profits.
Entrepreneurs need to be able to give a compelling presentation, with PowerPoint slide show, correct buzz words, all the tricks of the techie trade. “It’s called the dog and pony show,” said Schwartz.
And they have to be able to present their business profile in quick order. Schwartz recalls one hapless entrepreuner who was given all of four minutes and 34 seconds before being shown the door. “He was told he didn’t understand his ‘space'” Schwartz said.
Schwartz is a former CEO of SERC, a Palo Alto software company. He also practiced corporate law and was with a Big 5 CPA firm. The Sierra High Technology Group helps the entrepreneur in a variety of ways. It consults with founders to polish business plans and teach skills they need to make a presentation that will sell. It helps get funding from venture capital firms and angel groups. It has an experienced list of talent that provides the mentoring so vital to the growth of a new venture.
Right now Schwartz is working with someone who’s discovered an encryption technology for the music and movie industries. The music industry alone is a 40 billion dollar business worldwide, he said. The company is seeking a first round funding of ten million dollars.
He said there are some other great ideas out there that could be easily duplicated by someone else, so it’s important that he keep those new businesses confidential.
“The real technological breakthroughs are almost always simple but elegant,” Schwartz said.
Future startup owners have the opportunity to practice their presentations and receive constructive feedback from members of the group. They support each other and benefit from their diversity of talent.
The demand for high technology business is there. The money is plentiful and so is the technology. What is needed, and in shortest supply, Schwartz emphasized, is talented people.
People who have passion for what they do. That’s essential in this kind of business.
“Marriages and family life often suffer. It’s an all-consuming business,” Schwartz said.
Achieving balance can be tough, but the financial rewards are huge, he said.
“I recently read a quote that 64 millionaires are created daily in Silicon Valley,” said Schwartz. “The time from startup to IPO had accelerated to 12 to 18 months,” Schwartz said. “It is likely that the current market conditions will lengthen that period a bit.”
Entrepreneurs need to be creative. They need to be fast on their feet and willing to take risks. Diversity and a global perspective are important characteristics, as well.
He described his vision of the Sierra High Technology Group as spanning the from Lake Tahoe to Reno. He is also working with venture groups in Sacramento. Reno supplies several advantages: fast air travel to Silicon Valley, broadband internet access throughout the town, and comparatively cheap office and warehouse space.
Members’ backgrounds range from medical and military software to banking and software engineering. Some are CPAs and some are attorneys.
After becoming discouraged with the gridlock and pollution of Silicon Valley, Schwartz began to look around for a healthier place to live. He has quickly become a vital member of the Tahoe-Donner community, on the board of directors of the Truckee Youth Theater, and of the Tahoe-Donner Homeowners Association. His wife Helen, 45, has gone back to school at the University of Nevada, Reno, to earn a degree in nursing. The couple have four children.
Schwartz compared the current state of the technology industry to the beginning of the Industrial Revolution. Picking the winners can be difficult, and many businesses will fail. However, the surviving companies cause deep societal changes, affecting the entire culture.
“High technology will continue to drive the market, creating jobs for years to come,” Schwartz said.
To RSVP for this Thursday’s meeting, you can reach Schwartz at firstname.lastname@example.org or (530) 587-7685.
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