IT start-ups and venture capitals in Prague? Must be the "First Tuesday"
This week, we interview the president of the Czech branch of 'First Tuesday', a networking group for investors, entrepreneurs and high-tech companies. First Tuesday was named for its first such meeting, held in England in October 1998 at the dawn of the 'dot-com' boom. Radio Prague caught up with the president and co-founder of the Czech branch, Ivan Pilny, at the group's November meeting to take stock of the network's developments since its start here in 1999.
Ivan Pilny: "It was based, at the beginning, on the original concept, which means, meetings between start-up businesses and venture capitalists to find new ideas and how to finance them — which was relatively easy during those years because there was all that Internet hype. So those two groups were numerous and it was very easy to facilitate that. That was the original concept, which died a little bit, even with a lot of marketing, after that hype was gone."
So the burst of the dot-com bubble was also felt here?
IP: "Yes. But then, at least in the Czech Republic, the concept was changed: that means [a new focus on] facilitation and networking. That means bringing people together, talking about their businesses, find the necessary partnership or contacts, to be able to develop some portfolio of the services. That concept was very successful, very useful and people especially here in the Czech Republic like that concept."
"After that, we felt that it wasn't good enough and that people are also hungry for a bit of education, or a bit of sharing the experience in more organised forums."
And that's where these 'bootcamps' and mentoring and matchmaking comes in?
IP: "That's why we developed a concept of the 'bootcamps', which is only one part of the progressive education, it is usually a two-day activity where people who have some, or had some experience with [an aspect of] business can make presentations or mentor or coach the others. They come together and share their experiences. We are trying to do it not more interactively and more creatively. That means not only presenting but also developing and trying to find the potential in people — which is huge, here, surprisingly because to find and keep some entrepreneurship here is very difficult."
So how does the membership look today? You mentioned that the scope has changed and that the original idea of getting venture capitalists and IT people, Internet people together, that's changed.
IP: "We still keep the role of facilitators. For example, we are now making 'missions' abroad; the last one was to Brussels. There was a plane of more than 100 people going to Brussels, to gain some experience and 'map' the ground there, basically. So far, the community is limited mainly to IT, meaning technology, but also finance, legal staff, and biotechnology."
Today's meeting was essentially about the effectiveness of the group?
IP: "Today's meeting was — we are approaching the end of the year and this was a year of changing structures, not only in how people pay for the membership, but also how events were structured. So this evening was more or less about how members like the changes, what they would like to change for the year 2005 because the plans are still open and we'd definitely like to react to the entrepreneurs' needs."
For a start-up company, especially in IT or Internet-related companies, are they turning more to venture capitalists, or are bank loans easier to get than they were, say, four or five years ago?
IP: "From my own experience - because I am also an adviser to some companies that are doing some incredible good work on Internet marketing, for example - I think there is room for high-profile companies with a lot of experience. For the others, the doors are simply closed. I mean, bringing in some idea, without showing some cash flow or reasonable business plan, is totally hopeless, regardless of what kind of financing you would like to get."
"We can see a lit greater trickle of money in this community right now in the Czech Republic, but it is based very much on already high-profile companies which are filling a very interesting niche, for example, Internet marketing, or security. It means entrepreneurs must find a niche and gain experience in order to be financed. This is because the Czech market, of course, is small and sooner or later, especially to expand, you need some loan or venture capitalist to come to you. But to sell the idea it is much more difficult than it was a couple of years ago."
To learn more, please see: www.firsttuesday.cz