Oregon's economy remains bogged down. The unemployment rate in June was stuck at 9.4 percent.
But a report released Wednesday by the National Venture Capital Association shows $31 million have been invested in six new Oregon start-ups over the last three months.
As Kristian Foden-Vencil reports, that’s one sign that money is being pumped into the economy again.
CrossCurrent is a Portland start-up that makes software to help doctors and surgeons bill insurance companies.
Long-time listeners may remember OPB profiled the company's efforts to say alive after the economic meltdown of 2008.
CEO Chris Baker spent a couple of years trying to raise money to get things moving.
Now, he's pleased to announce CrossCurrent has secured $2 million in investments.
"The stock market has returned to the point where people who had portfolios, there's some value there to cash out. So that things have returned back to pre-crash level. Wealthy people are wealthy again. And for things that are interesting and investable, they have the money for it," Baker says.
CrossCurrent's experience may signal a wider trend.
Mark Heesen is the president of the National Venture Capital Association.
The group keeps tabs on all the money that's being invested in start-ups around the country.
Heesen says the last two years have been tough, with investors unwilling to spend, and big businesses nervous about buying small new companies.
"But, I think that what you've seen in the last six months in particular is a growing sense that we have hit bottom and we are working our way upwards now," according to Heesen.
He says he's seeing increased investment in life sciences and clean technology companies.
Over the last three months in Oregon, for example, the association says that Act-On Software, UpWind Solutions, Shopigniter, The Clymb, COLOURlovers and Wellpartner, raised a combined $31 million.
"When you look at the companies that have been funded in Oregon, they're all across the board. There's IT companies, there's retailing kinds of companies, there's clean-tech kinds of companies. So, while the numbers are not huge, you're not putting all your eggs in one basket."
In fact, according to National Venture Capital, Oregon ranked 16th in the nation last year for the amount of money it raised from venture capitalists. That amount totaled $200 million in 2010.
While that's not too shabby, it pales in comparison to the $600 million raised in Washington, or the $11 billion in California.
In an effort to try and increase the amount of venture capital in the Beaver State, the cities of Portland and Hillsboro as well as the state and several well-to-do Oregonians are pooling their resources to launch a new local venture capital effort. It's called The Portland Seed Fund, and Tuesday it announced its first eight investments.
Amber Case is the CEO of Geoloqi -- one of the companies to get funding from the Seed Fund. Her company allows you to track your location through your phone. So for example if you put your grocery list on your phone, you can then pick it up when you get to the store.
Of more interest to parents, perhaps, is that the company can also give you the location of other cellphones in your family -- like your teenage daughter's.
Anyway, as Case told the seed fund kick-off ceremony, she and a friend were working full-time while trying to build Geoloqi in their spare time.
"And we really wanted to quit our jobs and start working on it. But we were worried that we couldn't raise funding here in Portland. So we went down to the Valley and realized that the Valley wasn't somewhere where we wanted to start a company. We wanted to start a company here.....So thank you so much for your support and making Portland an excellent community for start-ups."
After the opening ceremony for The Portland Seed Fund, investors mixed with the entrepreneurs.
Ken Gunther made his money working for several corporations, like Georgia Pacific. But he says, he's not investing in the new Seed Fund to make money.
"It's mainly giving back," Gunther says. "It's an altruistic thing. I wouldn't put money into this for the concept of oh, it's going to be a return. It's a return, not fiscal, it's emotional and supportive."
That sentiment is mirrored by the amount of funds being lent. They're small, $50,000 maximum.
In fact, the whole fund only expects to raise to about $3 million to start with.
But at least it is a start.
CrossCurrent founder, Chris Baker, says a lack of venture capital is one reason why Portland companies have a problem getting off the ground.
He says another reason is that many large corporate headquarters have left the area. So Baker has had trouble recruiting high-level executives.
As much as he loves Portland, Baker says Stumptown also doesn't have the best reputation among investors.
"Some venture capitalists tell me they don't want to do deal in Portland because they're not sure that the people starting and running the company are motivated to make them a big pay day. Right, That they're going to say, I'm happy with this and I don't need anymore. And the feeling is in the Bay Area, screw the altruistic thoughts. Make me a pile of dough and if you're not dead focused on that, I'm not interested."
But clearly, some investors are interested in Oregon companies. So how soon will those investments pay off in terms of job creation?
The president of the National Venture Capital Association, Mark Heesen, says don’t hold your breath. Money invested this year is unlikely to start making a dent in the unemployment numbers for quite a long time.
"You're looking very often at about five years when you start to see real employment growth. And then hopefully, when they're between 7 and 9 years, they'll go public. That's when you see what can be explosive job creation come out of these companies."
For those who've already been unemployed for a year or more, that's a long time.