`Free’ Money?

VCs: Not All Alike

CCPA’s Search

Corrections or additions?

This article by Bart Jackson was prepared for the January 30, 2002

edition of U.S. 1 Newspaper. All rights reserved.

Curbing Road Rage

Oh merciful heavens, dear, that misguided

man up ahead, just swept right in front of me without signaling and

now has slammed on his brakes inches from my bumper. I do pray the

poor soul is not ill." Is this your reaction to the little

vagaries

of your fellow travelers along Route 1? Statistically not. The

Insurance

Council of New Jersey claims the odds are much more likely that you

will ignore all your Zen mentor’s teachings, become very human, and

loudly call that individual’s parentage into question.

Those interested in learning just how well we are controlling our

emotions on the road — and the exact price of our anger —

should attend the "Road Rage and Aggressive Driving" seminar

at the monthly dinner meeting of the Insurance Women of Mercer County,

on Wednesday, February 5, at 5:30 p.m. at Freddie’s Tavern, 12

Railroad

Street, West Trenton. The featured speaker is Rachel Enoch,

consumer education and research supervisor for the New Jersey

Insurance

Council. She sets down the facts, and helps create an accurate picture

of our behind-the-wheel habits. Cost: $20, including dinner. Call

Bonnie Adams at 609-883-1300.

The Insurance Women of Mercer County, a chapter of the national

organization,

includes women from life, auto, health, and all other branches of

insurance. It invites adjusters, bill payers, agents, file clerks

— anyone except vendors — to join. The group has

first-Wednesday

monthly dinner meetings.

A new traffic light goes up in America every 31 seconds. Most of our

interstate highways reached their safe and effective capacity in the

early-1970s. It is indeed an asphalt jungle out there, particularly

in our own Garden State. Yet despite it all, you will probably never

fall into a fit of real road rage. The example of the North Jersey

man who in response to a fender bender, leapt from his car, dragged

out the offender, and beat him senseless remains rare.

Road rage is, after all, the extreme. The law defines and punishes

it as a criminal offense entailing a deliberate assault by a driver

on human or moving auto; or an assault following some traffic-induced

altercation. "This may not be your style," points out speaker

Enoch, "But the seeds of it lie in us all."

Aggressive driving includes such dangerous discourtesies as

tailgating,

improper lane changes, and drag racing off a traffic light. Enoch

grew up in Randolph, received a bachelor’s from Richmond University

and a master’s from the University of Pennsylvania. Recently she

and others from the Insurance Council of New Jersey sought to

determine

the extent of aggressive driving habits in our state.

Sampling a broad spectrum of New Jersey motorists, the council

administered

the Larson Drivers’ Stress Test. Developed by Yale University’s John

Larson, the test is designed to gauge relative degrees of Impatience,

Anger, Competition, and Punishing Behavior. The results proved that

the urge to surge dwells in more than the rare crazy whose rage makes

the news.

Impatience. Rated on a frequency scale of "always"

to "never," drivers were asked how often they became visibly

upset while e.g. waiting for a parking place, encountering slow

drivers

or falling behind in your personal schedule. Less than one half rated

themselves at always or highly impatient. (Viewed the other way, our

state’s impatience glass is nearly half full.)

Anger. Do you express visible anger toward drivers who

e.g. slow down in front of you for no reason; cut you off or drag

slowly, well below the speed limit, or make unexpected stops? Here

is where New Jersey tempers truly shone with well over 50 per cent

displaying high-to-moderate amounts of anger at those annoying,

deserving

#$@*&.

Competition. Do you compete with yourself? e.g. "I

made this trip yesterday in 20 minutes, and today I’m already

behind."

How about beating the other fellow through the toll booth? Do you

ever race, or push the pedal just a little towards the limit at a

stop light to beat out the driver in the next lane? Apparently only

30 percent of Garden State drivers admitted to such frequent

behaviors.

Punishing Behavior. For any clumsy motorist’s offense

do you respond with a curse or some digitally symbolic gesture? Or

maybe you go a bit further by flashing your lights at this inept soul,

blocking her, or riding her tail — only when its necessary? Well,

you are in good company. Forty percent of those surveyed frequently

displayed moderate-or- more amounts of such punishing behavior, with

10 percent ranging into the high category.

Since 1990 over 13 million Americans have been killed or

severely

injured due to aggressive driving accidents. New Jersey’s 4.8 million

registered vehicles have unfortunately held up their bitter end. Of

280,000 accidents annually, the Insurance Council claims, one third

are due to aggressive driving.

"One thing this survey proved," says Enoch., "is that

aggressive driving spreads wider than any possible profile." The

old myth about young boys under 25 in red cars doing 95 percent of

the tailgating has proven to be exactly that. Old and young show the

same anger "and there are a lot of mommies hiding behind their

great big SUVs. They are as guilty as men."

Solutions are not simple. Certainly, if you see an aggressive driver

coming, Enoch’s advice of putting your pride in the back seat remains

sensible. Also, it wouldn’t display a loss of personal power if you

moved over for that person behind who wanted to speed on a little

faster. And if she really gets obnoxious, you can grab your cell phone

and report her to the #77 hotline set up by Congressman Franks. But

in the end, we might all live a little longer by paying attention

to our own tranquility.

A few years ago, my friend on the way to Princeton Medical Center

was suddenly cut off by a thoughtless motorist pulling into an

intersection

in Cranbury. Both cars halted in time to avoid any damage. Yet my

friend flung open his door, and began slamming his fists on the

offending

auto’s hood.

Granted, my friend was on his way to visit his recently stricken wife

and discuss her upcoming brain surgery. His new job demanded a commute

to Washington, D.C., and gave him enough hours on the road. He had

had it. He was large, powerful and surely must have terrified the

older lady inside the car he was assaulting.

In the end, he exhausted his arms and his anger, and retreated. Within

several minutes, my friend resumed the manners of a gentleman that

have been his habitual trademark. At the time, I personally had never

held a driver’s license and did not really understand all his fuss.

But today, having spent the last two years behind this magic wheel,

I recall those other drivers who have cut me off and realize that

there, but for a few bad circumstances, rage I.

— Bart Jackson

Top Of Page
`Free’ Money?

Entrepreneurs — if you are ogling the pot of

"free"

money that the government dishes out to promising technology firms,

look far forward into the future. It’s one thing to get a grant to

develop your technology, and it’s quite another to fulfill the

requirements

of that grant.

Take the Small Business Innovation Research program. These grants

require the entrepreneur to take a discovery out of the laboratory

and into the marketplace. It must go commercial.

Only by going commercial can you make the big money. SBIR grants can

yield $100,000 for the first phase and $750,000 for the second phase.

But typical profits for the first and second phases generally run

at seven percent. For the really good money, the entrepreneur must

get to Phase III.

How to get to Phase III is the topic for a workshop on SBIR Phase

II Proposal Preparation, presented by the Newark-based Technology

Commercialization Center (TCC). Gail and Jim Greenwood will

lead the workshop on Tuesday, February 5, at 8:30 a.m. at Rutgers’

Cook College campus center in New Brunswick. Cost: $60. Call

973-353-1923

(E-mail: scitech@yourbizpartner.com or www.yourbizpartner.com/scitech)

SBIR is the federal government’s largest R&D grants program targeted

to the small business community, says Randy Harmon, director of the

TCC. "It is inarguably the best source of risk capital available

to help fund the development of promising new technologies. And the

odds for the SBIR grants are very good, one in eight for Phase I and

two in five for Phase II."

The workshop will teach Phase I winners and applicants more about

the second phase of the SBIR/STTR programs — how Phase II differs

from Phase I, how the Phase II programs vary tremendously among the

agencies, and how to prepare the Phase II proposal.

Harmon’s Technology Commercialization Center (TCC) is part of the

New Jersey Small Business Development Center (NJSBDC) of Rutgers

Graduate

School of Management. Along with the law firm Hale & Dorr, the TCCC

is also putting together an advisory board to help Phase II companies

jump the commercialization hurdle.

"Historically, not enough technology has been commercialized,"

says Harmon. "We have companies that are SBIR factories. They

can crank out the proposals but are not as strong at commercializing

the technologies. But the federal agencies have been putting more

emphasis on the commercialization plans."

The College Road-based law firm is collaborating with Harmon to find

personnel for the advisory board in such areas as accounting, finance,

and marketing. Companies in this program provide the board members

with a good executive summary of their plans and then meet with the

board for about an hour. "We are starting off reviewing the

commercialization

plans of those who already have the Phase II grants," says Harmon,

"but we also hope to open it up to companies who are still

developing

their Phase II proposal."

Top Of Page
VCs: Not All Alike

Joe Allegra, partner in the Edison Venture Fund

at 1009 Lenox Drive, has been on both sides of the table. A venture

capitalist for just about a year, he spent most of the 1990s as a

high-tech entrepreneur, founding software company Princeton Softech,

and building it into a 60-person company. Princeton Softech was

purchased

for $43 million in 1998 by Computer Horizons. Allegra stayed on for

a while as the company’s president before trying on a VC’s suit on

a trial basis. Discovering how much he enjoyed talking with the

entrepreneurs

who brought their ideas to the Edison Venture Fund, he signed on full

time one year ago.

Allegra speaks on "The Secret Language of Venture Capital"

at a New Jersey Entrepreneurial Network meeting Wednesday, February

6, at noon at the Doral Forrestal. Cost: $45. Call 856-787-7900.

The main thing eager entrepreneurs tend not to understand about

venture

capital, says Allegra, is that it is a business with a goal identical

to that of any other business — to make money. But while that

goal is universal, different VC firms pursue it in different ways.

Commonalities include the fact that VC firms manage funds that

generally

are invested for a period of 10 years. According to Allegra, most

of the firms’ investors "look for the ability to go to about three

to five times the money they put in." Tenfold returns are even

better, but, says Allegra, "in the real world, companies don’t

go straight up." Even modest challenges can reduce returns. Larger

challenges, like the ones that cropped up during the past several

years, caused more than a few VCs to lose all their money.

More careful now, VC firms look first of all for a strong business

model, says Allegra. But no business model is perfect, so management

teams, which will have to keep making real-world corrections to the

plan, are given a close look.

Beyond the common goal of making a lot of money from backing start-ups

with solid plans and talented management, VC firms differ in ways

entrepreneurs approaching them need to know.

"We take companies with revenues of $2 to $15 million," says

Allegra. His firm’s goal is to grow these companies into enterprises

with revenues of $50 to $250 million. Other firms specialize in

pre-revenue

companies, early stage companies, or well-developed companies.

"We’re

in expansion stage companies," Allegra says of Edison. "We

generally invest $3 million." Other VC firms, he says, put in

just a fraction of that amount, while others like to invest $10

million

or more.

Before approaching VCs, an entrepreneur needs to think about his

company’s

stage, and how much cash it needs to get to the next stage.

Perhaps more important, young companies need to think about what they

expect from their venture capital partner. Some VCs just pour in

money,

says Allegra, while others, like his firm, take an active mentoring

role.

Geography plays a role in narrowing the field of VC firms, too,

especially

in choosing among those that take an active role in the companies

in which they invest. Many venture capitalists stay close to their

own backyards, the better to interact with the management teams of

their portfolio companies. Edison, for example, invests in companies

in the Mid-Atlantic region, stretching from New Jersey — or

occasionally

New York City — south to Virginia.

New Jersey, Allegra says, is under-served by VCs. Only 10 to 15

percent

of venture capital money raised in New Jersey stays in-state, he says.

By way of comparison, 60 percent of the money raised in California

stays put. "But," Allegra observes, "there are as many

high tech companies here."

He sees the number of new tech enterprises only growing as large

companies

stagnate or downsize. What that happens, says Allegra, "the smart

people start their own businesses."

Top Of Page
CCPA’s Search

Michael Hierl, president of the Pacesetter Group, has been named

to head a national search for a successor to Ellen Hodges, who

served as president of the Chamber of Commerce of the Princeton Area

for more than 25 years. Until she left her position one month ago,

Hodges had been the only person to head the Princeton Chamber.

According to a written statement, Hierl will head a search committee

made up of "leading representatives from the constituencies the

Chamber serves."


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