Entrepreneurs call it "the Valley of Death" - that seemingly uncrossable chasm separating great business ideas from the money they need to become viable companies.

A new outfit called the Valley Venture Group hopes to help bridge that gap for mid-valley startups. V2G, as the organization styles itself, joins the Willamette Valley Investors Network as the only angel investment networks active in the area.

Angel investors are different from venture capitalists, who typically make multimillion-dollar investments to help existing companies make the jump to the next growth stage. Angel networks are groups of investors who provide the seed money to help promising business ventures get off the ground in the first place.

The new group, which incorporated last month, has nine members so far, mostly from the Corvallis area, but their aim is to finance startups from throughout the mid-valley. V2G investors say they want to take advantage of the area's highly skilled work force to commercialize some of the best research coming out of Oregon State University and the Oregon Nanoscience and Microtechnologies Institute.

"If you look at just OSU, there's $300 million in (research and development) that's going on every year," said Krishna Rao, former chief operating officer for Summit Information Systems in Corvallis and a co-founder of the Valley Venture Group. "If you look at the whole OUS, the Oregon University System, it's more like $700 million - and none of it is staying in the valley."

Instead, he said, many of the most promising business ideas hatched in the mid-valley have had to look to angels in Portland, Seattle or the Bay Area to find startup capital, which put the mid-valley at a competitive disadvantage in the job creation derby.

Rao and his partners hope to make those research dollars pay off for the local economy by helping launch companies here.

"You can do a lot of stuff from here," Rao said. "There's a lot of opportunities. I'm not expecting billion-dollar companies, but I think we can create a lot of $100 million to $150 million companies."

The group's plan is to provide modest amounts of startup capital - say, in the range of $100,000 to $500,000 - in exchange for a stake in the fledgling company. The money could be provided by one or more individual investors, who will decide for themselves whether and how much to invest.

Companies will have to pass a screening process to make sure they're good financial risks.

To help protect their investment, V2G members say they will also provide business expertise, mentoring and other forms of nonmonetary assistance to the startups they decide to back.

"You've got to target the investment to people who have a chance to be successful and do everything you can to help them be successful," said V2G member Pat Lampton, owner of The Inkwell Home Store in Corvallis.

Other investors include Rich Carone, chief executive of Corvallis high-tech manufacturer Korvis Automation, and Bill Rauch, a Lebanon accountant and chairman of the Lebanon Community Hospital Foundation board. The group's remaining members have asked that their names not be used, preferring to do their investing out of the public eye.

Corvallis lawyer Jeanne Smith, an adviser to numerous area high-tech startups, is the group's general counsel.

Sporadic attempts have been made over the years to put together angel networks to help launch new companies in the Corvallis area. But the effort gained traction about 18 months ago, when the Willamette Valley Investors Network started working closely with the SWOT Team, a business development initiative led by the Corvallis-Benton Chamber Coalition and the local chapter of the Software Association of Oregon.

So far, WVIN has funded two high-tech startups, Perpetua Power Source Technologies and Eduworks, an educational software company.

John Sechrest of the Chamber Coalition welcomed the Valley Venture Group to the party.

"There's a distinct need for more dollars going into more businesses," Sechrest said. "I think the hard part is just getting enough deal flow. By putting more money on the table, they become attractors to the area."

Skip Rung, director of the Oregon Nanoscience and Microtechnologies Institute, called the Valley Venture Group's arrival "terrific news" and said it's a sign the region has a pool of quality startups to invest in.

"ONAMI, of course, is on the supply side of that equation, which is exactly where we want to be," Rung said, noting that the high-tech research initiative has already provided proof-of-concept grants to seven spinoffs, including five from its Corvallis affiliate, the Microproducts Breakthrough Institute.

Access to angel capital locally could help those projects take the next step to become full-fledged companies - and do it here, rather than someplace else.

The Valley Venture Group has already begun evaluating a handful of proposals, Rao said, and would like to start making investments within the next three months. Carone said V2G is shooting to bankroll two to four companies a year with the hope that, on average, they might grow to $25 million in annual sales within the first five years.

Rao will act as the point of contact for V2G. Entrepreneurs interested in pursuing financing from the group can call him at 760-1700 or e-mail him at krao@rr2llc.com.

Bennett Hall can be reached at 758-9529 or bennett.hall@lee.net.