How do you earn money sustainably? In the end, this is the decisive question for all business models. And 2007 has answered it for vast parts of the online media landscape: Advertising will be their main revenue source, as user-generated content providers like YouTube have heralded in the demise of paid-content business models. This development has further fueled the growth of online advertising and opened up tremendous opportunities for young technology companies that enable efficient online campaigns. We at Wellington Partners are very pleased to be supporting two of the front runners in this market: Advertising network Adconion and search platform Proximic. Both are based upon proprietary technology, both have a global approach and both are growing fast, proving the sustainability of online advertising business models.

But it is not just these companies that are making great progress in a short period of time. We also saw most of our portfolio companies grow at a fast pace in the first quarter of 2008, in spite of the slowdown in business activity in many countries. It is naturally too early to tell whether or not the calamities in the financial sector will impact technology companies at all, but current developments give us reason to be very optimistic about 2008 and beyond.

To get an even better feeling for current developments, we have opened up a business development office in Palo Alto. It is headed up by our Venture Partner Ram Srinivasan, a seasoned Silicon Valley executive. Like Ram, our Venture Partner network generally consists of highly established and extremely well networked professionals, most of whom are still driving their own businesses, as well.

For example, French serial Web entrepreneur Loïc Le Meur just joined our Venture Partner program and yet is running as full-time CEO his latest company, Seesmic, which he recently started in Silicon Valley. Now as a Wellington Venture Partner, he will be spending a few hours a month sharing his vast knowledge of the Web 2.0 space with our entrepreneurs and helping them expand their networks in what is by far the world’s largest hub for the technology industry. I am sure that our portfolio companies will benefit hugely from Loïc, just as they do from our other Venture Partners and the entire Wellington network.