NANTUCKET — Six New Hampshire entrepreneurs have started an angel investment group to spur the state’s technology sector, often overlooked amid the buzz created by software and Web companies in Massachusetts.
The group, 10X Venture Partners, was unveiled Friday during the Nantucket Conference, an annual gathering of regional technology executives, investors, and entrepreneurs. So far, it has helped fund three companies, from a start-up that has developed a new way to trim flowers to an online photo storage company, and has plans to invest between $50,000 and $500,000 in other small and growing businesses.
“We did this to grow companies, to grow jobs, and we are serious about it,” said John Gargasz, one of the founding partners of 10X and a former executive at Codem Systems, a defense company purchased by DRS Technologies Inc. of Parsippany, N.J., in 2005. The group also includes former tech executive Matt Pierson, who cofounded DTC Communications Inc., a wireless and video company that was acquired by the British company Cobham PLC in 2004.
Gargasz said the group isn’t going to limit its investments to New Hampshire companies, and it has invested in firms outside the state, but it wants to help seed the ground for more business development there.
While New Hampshire has long had a number of companies that were early pioneers in high-tech manufacturing and computing, it has fallen far behind Massachusetts especially when it comes to investment in start-ups. In 2011, companies there received just $97 million in venture capital investment, while $3.4 billion went to companies in Massachusetts, according to PitchBook Data Inc., a Seattle research and data firm that follows the private equity industry.
‘You do have to have a certain density of money’ for a meaningful community to take root.
Gargasz wants to change that imbalance, at least a little. For a meaningful technology community to take root in Manchester, or elsewhere in New Hampshire, he said, “you do have to have a certain density of money.”
10X Venture’s launch coincides with growing private and state efforts to replicate some of the energy in Kendall Square, the Cambridge neighborhood that has become a hotbed of Web start-ups and venture capitalists.
On May 30, the New Hampshire High Technology Council and abi Innovation Hub, a 15,000-square-foot business incubator in Manchester, announced a $500,000 business competition to attract young start-ups to expand in New Hampshire.
“It’s time for us to put a spotlight on New Hampshire as a place you can stay and build your business,” said Jamie Coughlin, chief executive officer of abi Innovation Hub. “There are people who could fully function in Cambridge or New York City but who are choosing to stay.”
But for angel investors and the state to attract young companies, and keep tech savvy residents from leaving, it will have to compete with Massachusetts, said Jamie Goldstein, president of the New England Venture Capital Association and a partner at North Bridge Venture Partners in Waltham.
“The challenge is recruiting talent,” he said.
“New Hampshire is a ripe area for technology companies, in particular infrastructure companies,” Goldstein added. “There is not as robust an ecosystem in sales, marketing, and product management talent as there might be farther south.”
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