FORT COLLINS -- Criticism followed the 2000 launch of Vista Ventures when the Northern Colorado venture-capital group took its time making investments.

But it was that same cautious attitude that David Dwyer, general partner, says has paid dividends be-cause "we have not sustained losses as have other technology investors and we still have funds to invest."

Of the eight to 10 viable Colorado venture-capital organizations in 2000, Vista is in the best position to make new investment, according to Dwyer.

The last couple years have marked the end of several venture firms, Dwyer noted, because they "heavily invested in the technology bubble in companies that really didn't have anything different to offer."

Because of Vista's conservative investment strategy, the firm anticipates soon receiving a Small Business Administration Investment Company license that would allow them two-for-one SBA matching funds.

"Through use of leveraged capital, the SBA through its SBIC program has actually made $700 million over the last six years," Dwyer said. "That's good for the local economy because capital begets jobs."

The founder of Vista did not go into venture capitalism blindly and remains substantially a full-time attorney with Dwyer, Huddleson and Ray PC. He has been in Fort Collins since 1981 practicing corporate and business law.

While advising corporations on financing, mergers, acquisitions and a wide variety of contract law, Dwyer observed businesses having difficulty with equity financing.

Eighty percent of Colorado's investment capital was coming from out of state, so he decided Northern Colorado could use not only local money but solid, objective management expertise. With a $20 million base, Vista Ventures was formed. Once the SBA Investment License is granted, Vista will be able to access up to $40 million more for equity investment.

Other Vista principals are electrical engineers and Stanford MBA graduates Catharine Merigold and Kirk Holland. Craig Hanson was recently hired as the fourth general partner and third full-time employee. Vista's offices are in the Interlocken Business Park and Fort Collins.

Vista has approximately 30 limited partners, who Dwyer said contribute capital only after the Vista management team has completed the due-diligence investigation and made the decision to invest. Funds are called in only as needed for equity purchases in portfolio companies, typically preferred stock.

Vista receives 400 to 500 business plans a year and has invested in only one company, LeftHand Network in Boulder. "We expect to be making another investment in January," Dwyer said.

Although Vista Ventures is primarily focused on Front Range entrepreneurs, they do not automatically eliminate other possibilities in the Rocky Mountain region. "But we prefer to invest where we can be close to companies to be able to provide help," said Dwyer.

Vista looks for startup companies that have a sustainable long-term business with a proprietary advantage, like a patent or some edge that keeps competition at a disadvantage.

"We still believe the world is in a technology revolution and focus on communications and information technology," Dwyer said, "but we are really cautious."

He said many angel investors do less than five hours of investigation before putting their money into a company. Vista takes two to four months after the initial screening to talk to everyone from existing management to customers, creditors and employees.

"We want to see a well-rounded business plan with all the pieces pretty much in place. Plus, we want to see an exit strategy -- in fact, several.

"Ideally, (Vista and any co-investors) would have two board positions, the company two and an objective expert in the (company's) field as a fifth board member."

Regardless of the uniqueness of the idea and thoroughness of the business plan, there must also be a good relationship before an investment is made.

"We need to be able to work well with the principals and know they are amenable to our suggestions," said Dwyer, adding that there are some areas of the relationship where only the Vista votes count.

Dwyer said Vista's strategy is "to invest for about four years, then harvest for the next four." The industry average return on investment is around 20 percent.

Dwyer said Vista defies the stereotype that venture-capital firms only build up a company to sell it off. "Vista is a value-added investor to emerging companies that have long-term potential."

That's a principle espoused in the company's Web site: "Our role is to help entrepreneurial companies achieve maximum potential through team-building, partnerships, advice and support as well as capital.

"We will help entrepreneurs with energy, vision and experience to build great companies."