I don't see why these predictions shouldn't hold true and read as significant for the Cuyahoga valley, as well - especially interesting are statements like:

"there is still too much venture capital chasing too few good investments"

"There is four times more venture capital than can be wisely invested"

So it doesn't seem this is a problem isolated to NE Ohio and indicates to me the entrepreneurs with viable products and services should be able to find the support they need, if promoted effectively.

VCs may need to redefine their role in the entrepreneurial world, more as friends and angels, with shared pools of perhaps higher risk money going to more earlier stage start-ups... even smart high school kids... speading the risk and opportunity while catching more hot pospects while still in the formative stage. Read on and share your thoughts:

VCs make Silicon Valley predictions
Robert Mullins

Software as a service, little computers everywhere and Microsoft buying Google after it goes public. These were some of the predictions for 2004 of Silicon Valley's leading venture capitalists at a Thursday night forum in Palo Alto.

But while the valley's economy seems to be rebounding, there is still too much venture capital chasing too few good investments, said panelists at the Churchill Club's 6th Annual Top Ten Tech Trends Debate, which drew nearly 700 people to a Crowne Plaza Hotel ballroom.

The most viable new software companies will be those that sell software as a service, which means businesses pay for their software as they use it, like electricity, says Jim Breyer, managing partner at Accel Partners, a venture capital firm.

"If a new startup software firm does not have a managed service model, we wouldn't fund it," says Mr. Breyer.

But while the trend is towards software as a service, it may not be complete, said Esther Dyson, chairman of Edventure Holdings. Some companies will want to buy software in a package that they are licensed to use in perpetuity. And a startup software company would be happy make a million dollar packaged software sale if that's what the customer wants, Ms. Dyson says.

VC firm Draper Fisher Jurvetson will consider investing in companies that make small computing devices in pens, phones, cars or other handheld devices that network with one another, says Tim Draper, managing director.

"You'll see more interesting computers that do all sorts of things," Mr. Draper says.

And there may be a surprise when, as expected, Mountain View-based search engine company Google Inc. files for an initial public offering of stock, says Tony Perkins, program moderator and creator and editor of AlwaysOn, a tech-focused Web log, or blog.

There have been an increasing number of people writing in blogs predicting that software giant Microsoft Corp., of Redmond, Wash., will launch a hostile takeover of Google after it's IPO. Mr. Perkins compared the growing number of comments on the topic to the "chatter" that Homeland Security Secretary Tom Ridge hears about terrorist plots.

But while innovation is going to continue in Silicon Valley, there are still going to be many ventures funded that will fail, says John Doerr, a partner at Kleiner Perkins Caufield & Beyers.

"There is four times more venture capital than can be wisely invested," Mr. Doerr says.

While there may be 10 startups going after a particular market segment, the market may need only three, so the investors in these companies won't make as much money as they hope, if any.

"There is [going to be] no return to these investors. They won't even get passbook savings," he says.

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