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WHAT has changed? A more buoyant stock market has certainly helped, as has the fading of memories from the ugly aftermath of the dotcom bubble.

But Richard said investors and entrepreneurs had been given enormous hope by Ebay’s recent purchase of Skype in a deal that valued the internet telephony company at up to $4 billion. “The Skype deal was quite galvanising,” he said.

Run from London, Skype managed to attract more than 50m users in only two years of operation. Although Skype’s revenues to date have been modest — $7m last year — the willingness of Ebay to pay such a handsome price has made many technology investors rethink their ideas of what is possible.

Skype had to overcome enormous scepticism at first. Julie Meyer, founder of First Tuesday, the dotcom networking business, now runs Ariadne Capital, which acted as an adviser to Skype. She said Skype founder Niklas Zennstrom couldn’t get funded and was treated as “a bandit” because of his previous involvement with Kazaa, the music-downloading firm.

“Those guys really had an impact,” she said. “Niklas is a fascinating person. He’s got another big company in him.” ()

The sale to Ebay represented a huge triumph for Skype’s backers, led by Index Ventures and the American firm Draper Fisher Jurvetson.

“Index has made its entire fund on one investment,” said Richard. “That galvanises investment. I bet they are willing to take all sorts of risks.”

At Index’s office in London, Danny Rimer, general partner, said: “The Skype deal with Ebay probably has had repercussions in terms of entrepreneurialism, not only in Britain but across Europe. It’s had the effect of providing confidence to entrepreneurs to really go after big opportunities.”

Despite limited resources, Skype quickly managed to establish itself as the global leader in an important technology — voice over internet protocol — which is set to replace traditional telephony. In the past, many British technology investors have preferred to address small niche opportunities, rather than chase big consumer markets where the competition and the risks are much greater.

Rimer said: “Skype has demonstrated that you really can build a global opportunity right here in Europe’s backyard.”

Having raised another €300m fund earlier this year, Index is looking to back more teams “that we believe have found a technological advantage that will totally disrupt the traditional economics of a market or a business”.

AND it’s not just Skype. Graham O’Keeffe, senior partner at Atlas Venture, said the new mood of optimism reflected a revival of confidence in consumer internet businesses.

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