Despite all the changes in the high-tech sector over the past few months, one thing has remained constant -- the University's Internet business incubator remains empty. Three months ago, Craig Markovitz, chief operating officer of incubator PenNetWorks, said the venture was "fully ready to roll." Since then, despite receiving more than a hundred additional business proposals, the incubator has yet to announce any member companies. According to Markovitz, entrepreneurs from about eight companies -- most of them Penn-related -- are in the final stages of approval. One has received approval but has not decided whether to come into the incubator. "It's taking time," Markovitz said. "We didn't want to foolishly jump into anything." "It's just going through its startup phase, and raising awareness that it's there, putting it in place and starting to collect that first wave of business plans," said Philip Goldstein, corporate operating officer of Penn to Business. "It's just a timing issue." P2B is a University-owned not-for-profit corporation which owns PenNetWorks. Goldstein also said that, of the approximately 200 submitted proposals, 40 percent came from Penn sources, and one-third of those came from students. While Markovitz could not discuss the specifics of the companies, due to confidentiality agreements, but did say that they fit the original plan of Internet-related business. "Most of them are technology-based in some way," Markovitz said. "The public markets are doing what they did a year ago. Our mission... really hasn't changed." Unfortunately, what the public markets are doing -- falling -- will not help PenNetWorks. According to Bob Robinson, president of the Entrepreneurs' Forum of Philadelphia, companies seeking funding in today's cautious market are being intensely scrutinized for profit potential. "You're seeing a lot more people asking questions," he said. They're asking fundamental questions, they're not jumping blindly anymore." "There were a lot of people leaping in on leaps of faith, based upon, 'if we build it, they will come,'" Robinson added. "Now, you're finding people doing market research and trying to determine, what's the best marketplace for them to be in, before they leap." It appears that PenNetWorks is pursuing just such a strategy. "I think there's still a pretty high degree of confidence in companies that are based on sound business ideas, that there's still interest in supporting those," Goldstein said. That may not be clear to visitors checking out PenNetWorks's Web site, which has not been updated for several months. Markovitz said this was the result of a combination of a site overhaul and the need to focus on evaluating the incoming business plans and negotiations with the entrepreneurs. Markovitz acknowledged the need to update the site, but noted that PenNetWorks has remained visible at Penn and other local universities, especially by sponsoring the Wharton Business Plan Competition. PenNetWorks should benefit from an increased interest in Philadelphia among venture capitalists, though the city has not traditionally been associated with high-tech business. "A lot of the buzz we're hearing in New York is that they're hearing there's a lot more energy in Philadelphia," Robinson said.
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