Opportunities for venture capitalist (VC) funding may be thin on the ground, but it is not all doom and gloom for UK-based entrepreneurs looking to get a new idea off the ground.
Speaking at an Open University Business School lecture entitled Ebusiness: hype, myth and reality, internet entrepreneurs, VCs and academics debated the current state of e-business and the lessons to be learned from the dotcom boom and bust.
Simon Murdoch, who sold his online Bookpages company to Amazon.com in 1998, admitted that much of the dotcom hype had failed to materialise.
"Around 1998/99 I remember a quote that if you weren't on the internet in three years you'd be out of business," he said.
"It was the sentiment at the time; that the old economy businesses would move too slowly to compete in this revolution."
But Murdoch, who is now co-founder of Episode 1 Partners, the UK's largest dedicated internet start-up fund, which is backed by Chase Manhattan bank, said that it is hard to find VCs willing to take the risk of early stage investments.
"But the things I'm looking at are software businesses where you're not relying on other investments at a later stage and where there's a good chance of getting profitable with an initial £500,000 to £1m investment," he explained.
"You need a combination of really mean people who are good at selling. We have seen a big hype in ebusiness, but it's not just about sales order processing.
"It's about using the power of information over the internet to offer benefits to your customers.
"Don't be fooled by the boom and bust; it happened because it was a revolution. Carry on doing things because we haven't even scratched the surface yet!"
Gary Jesson, founder and managing director of eFinancial Management, which offers a hosted service to customers, cited "looking after staff" and "staying focused" as key survival techniques in the current economic climate.
But he admitted that there are no hard and fast rules to making the right decisions 100 per cent of the time.
"We spent about 10 per cent of our £1m original investment money on getting it wrong. It's important to know when to cut your losses," said Jesson.
"We've dealt with cyber-squatters, and we've been unable to get staff when we wanted to. It isn't easy but, if you stay focused, you'll get there. And take all the advice you can get.
"Money is tight. VCs used to invest in ideas. Now it has to go beyond that to stand more of a chance of receiving money.
"As the chief executive of a small business, you don't know all the answers. Creating the right team and the right culture is fundamental."
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