A woman who made millions at Cisco has formed the first "Incubator", aimed at providing women with the connections they need to start up technology companies in Silicon Valley.
The scheme, dubbed the Woman's Technology Cluster, will open next month in San Francisco's Multimedia Gulch.
Catherine Muther?s aim is to help women exploit business opportunities and she sees her old Silicon Valley haunt as ripe pickings because female chief executives and women entrepreneurs are still poorly represented in most technology areas.
And one of the most traditionally difficult issues for women starting a new business is finding financial aid. The National Foundation for Women Business Owners reports that only 1.6 per cent of the total $33.5 billion venture capital investments made between 1991-1996 went to female entrepreneurs.
As a result, the high-tech sector is particularly problematic because most firms are started with the help of venture capital and "angel" investors, and it is rare for a venture capitalist to fund a company that has not come through a referral.
For that reason, Muther has got together with private investors, corporations and the city of San Francisco, to form the Incubator. The initiative has already attracted $500,000 in funding of its own and will open for business in January, 1999, in San Francisco's South of Market district.
The Cluster will be located in a 22,000 square foot, single floor of a warehouse and will house 20-25 technology-related startup companies focusing on multimedia, software, networking and communications.
"It's perfect for start-ups. Perhaps we should add some sleeping cots to the space," Muther said.
Each start-up will receive inexpensive office space, business consulting and mentoring from law firms and accountants, discounted health insurance, long-distance telephone rates and shared support staff and facilities.
"If you take a group of start-up companies, pre-select them, put them in a physical space with good technology and provide executive mentors and a host of professional services, you lower the perceived risk for investors," Muther explained.
But the start-ups must pledge to put two per cent of their equity into an equity investment fund. This will represent all of the companies that go through the Incubator and be used for future investments.
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