Welcome to the VentureDome

Darren Neylon is chief executive of a web portal that puts entrepreneurs in touch with investors. And he knows what his clients need - after all, he's been there himself.
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The Independent Online

Darren Neylon doesn't fit the profile of your typical dot.com entrepreneur. He wears a tailored suit, not scruffy jeans; his hair is neither long nor unkempt; his headquarters are a luxurious subterranean office in a quiet square north of Oxford Street; and he's pushing 40, happily married, with three kids.

But as Neylon points out, not every common perception about dot.coms is accurate. As the chief executive of VentureDome, the portal that links entrepreneurs with investors through its host of news, networking and search tools, he recently conducted his own MORI poll of the UK's most flourishing startups. "People think that dot.com entrepreneurs are in their mid-twenties, guys in jeans who live on take-aways. We found that in the top 100 startups, there were only 13 millionaires in their twenties. The average age of those we surveyed is 39."

Neither should you believe the hype about the venture capitalists eager to fling money at any kid with a bright idea. Neylon's own startup was backed by the management investment firm Springboard last year, and he now has 25 staff and a board which includes Chris Oakley, head of Regional Independent Media.

"The UK has the biggest venture capital industry in Europe, but I would dispute that it's suddenly easier to raise money. Just because people have an idea and can now discuss it in a more public form doesn't mean that it is easier to raise finance and get advice. The industry requires all kinds of boxes to be ticked, and if the entrepreneur doesn't understand them, the chances of getting money are slim."

One belief that is gaining credence is that entrepreneurs should be applauded. "In the past, I think Brits would let the Americans forge a path and then come in and do it successfully on the basis of those mistakes. But I think that's changing and that entrepreneurs here are beginning to get the respect they deserve for having a go."

Neylon, 38, trained as an accountant and worked for Australia's largest investment bank before taking an MA in applied finance. In 1997 he moved to the UK with his British wife and joined NM Rothschild's acquisition finance department. "I was working with a lot of wealthy entrepreneurs and successful businessmen and I was totally caught up with what they were doing. I was thinking, what am I doing on this side of the fence?

"In a lending role, your aim is to find reasons why you don't want to lend money. What I actually wanted to do when we were working with all these management teams was to find reasons for doing business with them. I got disenchanted with debt. I wanted to do something on the equity front, or do my own thing. It was a matter of finding the right opportunity and not throwing away the skills I had acquired. The evolution of the internet allowed me to pursue that plan."

His brother had already founded a successful web company, and when Neylon came to Britain and began working in acquisition finance, he saw that there was a gap in the market for a private equity internet portal.

"The adoption of the internet as a serious business tool hadn't happened and there was a lot of negative opinion about what the internet represented," he recalls. "I had researched how portals could be used commercially, and realised the two things that would make the UK the perfect place for a vertical venture capital portal. One was the size of the venture capital market. You need a massive market for a portal to work, and here there's a £20bn market, significant in anyone's book. The second thing is that the industry was largely fragmented. There were information bottlenecks and costs involved in distributing information."

The logistics of transferring information and currency seemed simple. "I went through every single reason why it would work. In the US you've got 4,000km of land between LA and Boston; here there's a compact geography to deal with. In the US there's a greater risk appetite at an individual level. Here it's the venture capital firms who drive the industry. The traditional market is very mature and very collegiate, but there's a mystique about it, and it's hard for entrepreneurs to get information and to access the right people."

When he met Stephen Ross at Springboard last May, he mentioned his idea. Ross agreed to resource it if he could come up with a credible business plan. "The word 'risk' didn't even come into my mind, funnily enough. I was there in my late thirties, with three kids and a mortgage, and if it bombed, it bombed. There was a lot at stake, but the idea was a big idea."

He resigned from his job and has since been hard at work developing strategic alliances with partners such as Sun Microsystems. Having launched the site with a bang - including a tongue-in-cheek Ali G interview with Alchemy's Jon Moulton - he plans to generate revenue from sources including sponsorship, sale of content to other sites and transaction fees.

The big test will be VentureDome's success in matching ideas with cash. "We don't need to spend on advertising because all the movers and shakers are there on the site," he insists. "For every entrepreneurial team that gets a deal, that's a great PR story for us.

"An entrepreneur needs to be able to structure a business plan, to know the pitfalls and the steps to raise finance, and to get advice from the right people - and to do that quickly. We're trying to provide all those things in an understandable manner so that people can get on their way. We will point entrepreneurs towards investors who suit their needs and have a serious appetite for their deal.

"That is very different from getting 38 knock-backs before you find someone. We are not saying: 'Here's a bunch of names, off you go.' It's not a Yellow Pages thing. If one knocks you back, we will take you to the next."

Neylon plans to cater for investors in larger deals (£10m to £75m, and £75m plus) by developing streamed news content, and is also keen to develop risk appetite by offering individuals private placing opportunities. At some stage he wants to go global, but not just yet.

"The common mistake is to set up operations two inches deep all over the world which provide little value. We want to be 10-miles deep and be of incredible value to the user, and then take that template and roll it out. At the moment, the challenge is to stay focused."

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