Q: Are you seeing more entrepreneurship from the corporate world? Are laid-off corner-office executives coming to you with business plans?
A: We have seen that. The challenge for those businesses is getting funding. They don't have the track record. ... What they do bring to the table is pretty deep domain expertise, so if they can align themselves with a team or another individual who has taken a company from a start-up to a significant liquidity event, that's a pretty powerful team. ... But it is a hard transition from the mother ship of some of these big corporations to buying your own paper clips, and it's not for everyone.
Q: You are focused on the Southeast. Where are most of your investments?
A: About a third are in Georgia. ... Our coverage has expanded in the current fund so that we are now spending time in South Carolina and Arkansas.
Q: What's in Arkansas?
A: For the most part, very early-stage companies, but we are ultimately hoping to see more spin-offs from Wal-Mart [which is headquartered in Arkansas]. In addition to being the largest retailer in the country, Wal-Mart wants to be a major player in the health care industry. So, with our health care focus, that could be a nice tie-in. ... That's a case where you're following entrepreneurial minds out of big corporate settings in the hopes that they can translate that domain expertise to a smaller company.
Q: Does Noro-Moseley ever invest outside the Southeast?
A: We are not going to make an investment in California, for example, because the business looks interesting. If a company from out there makes it all the way to Atlanta without getting funding, then there's probably something wrong with the business. But we do make exceptions when there are [entrepreneurial] teams that we want to be part of.
Q: How do you think health care reform might affect your investments?
A: We are very cautious about where health care reform is going. . . . We are anxiously awaiting more visibility around what the final legislation is going to look like.
Q: Has that made you hold off on health care investments?
A: No, we're not holding off. . . . But we're being pretty selective about what we do right now. We do think that telemedicine, remote-monitoring, anything that can save money but personalize the way that you are treated —- such as disease management or bringing care to the home —- are going to continue to be themes in this new administration.
Q: Venture capital is a pretty male-dominated business. I imagine you often are the only woman at the table. What's that like?
A: I am so used to it that sometimes I am oblivious. And that's not a good thing, either. I would love to see more women in our business. I would love to see more female entrepreneurs that we could back.
Q: What would have to happen to increase the number of female entrepreneurs?
A: I think the shroud of mystery over raising venture capital needs to fade away. . . . There's nothing mysterious about it. We want to invest in the best company we can, and if it's run by a woman, great!
Q: What could female entrepreneurs learn from their male counterparts?
A: There's a difference in the way a woman asks for money and the way a man asks for money. The woman is probably going to solicit more feedback from an investor on how much capital may be needed to grow her business.
And the man is going to take the number he needs and add $10 million, and go for it. ...
The reality probably is that the woman has dotted every 'i' and crossed every 't' and knows everything about her business, and the man may not have, but the self-assuredness goes a long way.
The seasoned entrepreneur sees opportunity amid crisis, says Kathy Harris, a partner in Atlanta venture capital firm Noro-Moseley Partners.
"Entrepreneurs who have had one or two successes in the past will tell you that this is a great time to start a business because there are a lot of talented people available, space is relatively inexpensive, supplies are relatively inexpensive," Harris explains. "So it is a good time to start a business if you have the intestinal fortitude."
Harris, who has a business development role at Noro-Moseley, spends much of her time on the road talking to Southeastern entrepreneurs. She also gets involved in most of Noro-Moseley's investments in health care, an area of emphasis for the 26-year-old firm's sixth fund. Noro finished raising money for the $120 million fund in the spring of 2008 —- a completion that Harris describes as "excellent timing."
So, what is the most important element of a business plan in these challenging times?
"Good cycle, bad cycle, no matter what, we're always looking to the people," Harris says.
Business
The Kathy Harris file
Partner, Noro-Moseley Partners
Age: 51
Hometown: Salem, Ky.
Residence: Buckhead
Favorite philanthropy: The Michael J. Fox Foundation for Parkinson's Research
What you're reading now: "Half-Life of a Zealot" by Swanee Hunt
Favorite travel destination: New York City and Florence, Italy
Best movie you've seen recently: "Tell No One"
Favorite movie: "The American President"
About the Author
