Research results in no capital for new ventures

Misguided venture capitalists (VCs) are shying away from internet start-ups as a result of over-optimistic market research, according to Daniele De Winter, CEO and founder of health and beauty website Ecura.com.

In December last year, De Winter's enterprise received funding from Angel Investment but the venture failed to take-off. She decided to re-write the business plan and start again, but says investors allowed their business vision to become blurred by internet hype.

She explained: "Research is only expectations. Reality is very different. VCs were throwing money at anything six months ago. Now, no-one will consider a business-to-consumer venture."

She continued: "VCs underestimated the cash burn rate and overestimated the uptake of the internet. When the internet bubble burst, VCs became careful, leaving many companies in trouble."

De Winter is now involved in a new venture, but would not reveal further details. She said: "The key to success is to have a sensible business model with a low cash burn rate."

You can see the full interview in our European Entrepreneur 2000 Special at http://www.silicon.com/ee2000