U.S. spy agency's venture capital fund now bankrolling 8 high tech startups

It is probably among the last places most entrepreneurs would think of tapping for venture capital funding. Regardless, the Central Intelligence Agency has gotten into the game of providing much- needed seed money for high technology startups. It took a lot of arm-twisting to persuade Congress and some in the intelligence bureaucracy that starting a venture capital fund to keep critical government agencies like the CIA at the forefront of new technology would be a good idea. Yet, that task was accomplished and Congress approved $28 million last year for the project and In-Q-Tel was born. To date, In-Q-Tel, the CIA's venture fund, has reviewed more than 300 business plans and provided seed money for eight high-tech companies. Most of them share a common mission of creating new security technology. Indeed, In-Q-Tel is going to provide money only to companies whose products can in some way benefit U.S. security interests. Gilman Louie, In-Q-Tel's CEO, said in an appearance Friday on CNNfn's Market Call that in addition to computer security he is interested in such things as sensor technology that could help U.S. military and spies detect biological and chemical weapons. In-Q-Tel differs from traditional venture funds in at least one significant way: It is not a money-making operation. The fund has non-profit status and any earnings it makes on its investments will be sent straight to the United States Treasury.