CAPCO's Exposed, George Lipper
"CAPCO's are the most insidious, complex effort to raid city and state treasuries in the name of venture capital." I didn't know what a CAPCO was until I met with Bill Payne in Las Vegas last month. Over breakfast he described the work George Lipper has done over the years to expose these scams.
George has left NASVF in protest over the organization allowing CAPCOs as members, "it'll be a few years and they'll be running the organization". So he's built a new website to continue his crusade, LipperCurrent.com.
Besides scams we talk about Seed funds. Is it a good time to start a new Seed fund? "Only if you can be very patient."
Show #228 (44:59) Listen
Events
Register for UCLA's upcoming 2009 Entrepreneurs Conference on May 8th. Use discount code: MP_TFPS
It's Fast Pitch season! Jump on the Inland Empire's event May 14th at the Hilton Ontario Airport. Then in Orange County at UC Irvine on June 9th.
Frank, here are a few of the more significant stories from the database about CAPCOs.
First here's the recently released audit from DC
With sharing CAPCO information, it's hard to know where to start. I have more than 200 studies and stories in a database, dating back more than 6 years. And in addition, of course, we have lots of documents we've used to help people understand the program. I'll start by offering you some of the links to stories in the database related to various state interactions with CAPCO programs. Even the best have been questionable.
Missouri State Auditor's Report
Chapter from Daniel Sandler's book on VC and Tax Incentives
Fifth Annual Report of the New York CAPCO program
Fourth Annual Report of the New York CAPCO program
Third Annual Report of the New York CAPCO program
Governing Magazine Article
Colorado Office of Econ Dev responds to Adam's "study" on CAPCO effectiveness
Colorado Audit of CAPCO program
Milwaukee Journal story on pending CAPCO legislation
Denver Post story on Audit of Colorado CAPCO
Palm Beach Post story on Florida CAPCO (among my favorites)
Rhode Island story on considering CAPCO and
Julia Rubin public radio interview
Understanding CAPCO booklet
And even the critical Louisiana audit, where it started
In case you haven't seen it, here is the DC auditor's report issued 3 weeks ago. And the story about it posted in the DC Examiner News
Comments
I've been trying to educate folks about the perils of CAPCOs for years with no discernible effect. I'm hoping to learn from Lipper. The scorched residue left behind by CAPCOs is more pervasive and more tragic because of their spreading acceptance by states deluding themselves into believing that they actually can make money and build businesses with these people.
Thanks for the heads-up.
Posted by: RM | May 5, 2009 08:21 PM