Daniel Rimer, in common with much of London’s venture capital set, for the most part shuns the media limelight. When he is confronted by a journalist, however, he is very clear about what he’s looking for in potential tech investments.

"We like to get involved at the early stage. For us it’s all about two guys who come in with lightning in a bottle," he says.

"We are looking for more economical solutions to problems – solutions that blow the incumbent way of doing things out of the water."

His company, Index Ventures, could itself fall into that category. The VC house started life in Geneva in 1996 to apply a Silicon Valley approach to Europe.

"The environment in Europe in the mid-1990s was analogous to that of Silicon Valley in the early 1970s," says Mr Rimer, himself a ten-year Silicon Valley veteran. "There was a kind of vacuum, where you did not have the culture or market in place to address the needs of entrepreneurs."

His firm, Mr Rimer says, considers itself one of the "cookie cutter" tools that, along with the lawyers and headhunters, are necessary if a region is going to turn out hot, fresh businesses.

The Valley logic, carefully applied, appears to have found fertile soil in Europe. Consider today’s sexiest tech ventures. Online gaming? Betfair, the world’s leading betting exchange, counts Index as an investor.

Like the idea of making free telephone calls over the internet? The news this week that Motorola, the mobile phone giant, has launched a new phone which includes VoIP (voice over internet protocol) technology from Skype – another Index-backed company – raises the prospect of such calls becoming commonplace.

How about the opensource revolution? Microsoft’s decision to unveil a more secure version of Internet Explorer this week was widely interpreted as a rearguard action against freely downloadable rival programmes. Among other opensource companies, Index Ventures is involved in MySQL – the world’s most popular opensource database, which is used to power more than six million high-volume websites and other applications.

Index launched a $20 million fund in 1996, progressed to a $180 million fund in 1998 and went on to ride out the dot.com catastrophe of the early 2000s, raising $300 million in 2001. Still, Mr Rimer is able to admit that some people are suffering from "the hangover of the internet bubble".

"The real difficulty is not in finding good entrepreneurs, it is in crafting the management teams to support them," he says.

"Lots of talented people would rather stay at a big concern such as BT, rather than leverage their skills in an uncertain situation where, in truth, they would be likely to make ten, maybe a hundred times more money."

Mr Rimer believes that the UK leads the European pack in terms of high-tech investment – he points out, for example that IT investment in Britain outstripped that in Germany last year for the first time.

But the Atlantic still marks a huge cultural gap, with American entrepreneurs – and managers – much more inclined to make a leap of faith on the back of an unproven business plan. He also suggests that the slew of bankruptcies and collapsed tech portfolios that signalled the end of the dot.com boom obscured the internet revolution’s true significance.

"You need to have an attitude which says that a certain amount of scar tissue is good because it will remind you not to make the same mistake twice," he says.

"But, you know what? The best-kept secret is that the fallout out from the dot.com crash really wasn’t so bad. Too many commentators saw the bubble and said that the internet was some sort of giant science experiment that wasn’t going to change the way that companies do business. But now you see that the best performing stocks on the Nasdaq are internet companies.

"True, you got some unreasonable euphoria and lots of people lost money, but you look at the charts now and you see that the curve is heading up and to the right."

So what is the next big thing on the tech horizon?

"We regard eastern Europe as our India," says Mr Rimer, pointing to a solid base of rigorously trained software engineers who now find themselves with the opportunity to participate in a free-market economy. The engineers behind Skype, for example, work in Tallin in Estonia.

"If India, which has world class educational institutions in place, is in the third or forth stage of its technological development, then much of eastern Europe is in the first," he says.

"The talent and desire is present there to make it a very exciting prospect. From a pricing comparison it is also attractive"

Accession to the EU has been a positive experience, he adds. "Things like the improved flow of people could lead to improved flows of money. It’s not happening quite yet – but it could easily."

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