Talking about venture capital created some buzz at the Big Event. Does that mean some deals could be happening in the long-depressed VC market?

Could be.

“These changes in the Metrolina Entreprenurial Council (now BIG) are bringing some excitement to the community. It’s the next stage in entrepreneurial development for Charlotte,” Gregory Johnson with The Academy Fund, told Local Tech Wire.

While Johnson said the Academy Fund does not have new money to invest currently, he is looking at future start-up investments at the University of North Carolina at Charlotte, primarily in electronic circuits.

Johnson also noted that valuations for start-ups are “on the rise, which is good from a founder’s point of view.” Johnson said it even benefits venture capitalists, because “When valuations are too far down, companies lose their incentive to take investments.”

Robert Kear, a former YouCentric foudner now with Charlotte Capital Plus (CCP), told LTW that people at the conference seemed to feel the MEC changes announced the previous evening and the conference itself “Is a real step forward in terms of getting the entrepreneurial community here more unified.”

“We’re a small fund looking for a technology company investment in the area,” Kear added. One of CCP’s portfolio companies sold to a Kentucky firm sooner than expected. CCP invests from $500,000 to $2 million or $3 million in companies, Kear said.

Not that easy?

Some skepticism about the recovery and in particular, about financing opportunities, remained evident at eh conference. Budd Watts, managing director of the Carlyle Group told a panel on “Approaching Growth Capital and Corporate Restructuring” that his firm sees “a large amount of capital chasing good opportunities.”

Watts also said that valuation multiples “are loosening and there’s a large supply of capital interested in getting deals done.”

Bill Boyd, chief executive of Muzak responded, “I think it’s interesting that all this money is looking — I never found it that easy.”
Still, Watts insisted that “It’s a great time for middle market companies seeing capital or buyouts.” He added that he sees “a lot of European dollars chasing U.S. opportunities.”

Boyd cautioned companies to tell their investors bad news “in five minutes. You can wait a month to tell good news.” That, he explained, is because “It’s essential for your investors to trust you. You’re in business together.”

Joe Alala, Capital South General Partner agreed. “Once a financing is done, you’re true business partners and you always get the bad news out first.”

Mike Robinson, U.S. LEC chief financial officer, suggested that companies “keep a broad set of relationships with your capital partners.” That way a company isn’t orphaned if its chief liason goes elsewhere, he noted.

The panel noted that while IPO opportunities “are not frothing,” the IPO market is open. One panelist suggested that the market may actually be “over-valuing near-term profitability” because they receive higher valuations, but may not sustain profitable growth.