Matt Richtel at NY Times Bits summarizes a survey from the National Venture Capital Association.

The survey results show that VC’s had a successful 2007 in terms of creating markets in new regions. The Silicon Valley, San Francisco, Berkeley area is the undisputed national leader in total deal flow. Meanwhile, other regions are growing at a faster rate. Richtel writes:

“A number of factors propelled growth elsewhere. Among them, some not-very-startling developments: increasingly capable telecommunications and accessible travel has made it possible for venture capitalists to live in financial centers but to oversee investments in distant areas. But there have also been specific efforts by regions outside of Silicon Valley to attract capital, and those efforts are paying off, said the National Venture Capital Association.”

From my limited perspective, telecommunications technology seems to be the main enabling force here – email and web based communication especially. Vendors and clients are learning to work together in new ways, especially remotely. As a result, individuals with highly specific expertise (VC financiers as an example) are available to a much broader economic region.

It’s not a 2007 thing… the NVCA analysis supports ideas that people have been talking about since Gilder’s Telecosm and Malone’s Future of Work.

According to NVCA President Mark Heesen:

“Venture capital growth is extremely organic. Once a critical mass of companies is funded in a certain region, a new ecosystem will develop,” Heesen says. “It is very magnetic in the sense that start-ups breed innovative thinkers and entrepreneurs who, in turn, attract venture capitalists. For regions that don’t have a large, indigenous venture investor base, it is important to give outsideVCs a reason to visit.

Good stuff!

[tags]indigenous wisdom, venture investor base, co-creating progressive management jargon[/tags]