Sep. 23--Pity the poor startup.

Scores of technology startup companies in the Mid-Atlantic region have pitched their ideas to investors over the past year, only to come away with little or no funding. By many accounts, the recession and stock market losses have turned swashbuckling early-stage investors into penny-counting worrywarts.

As a result, more entrepreneurs have relied on so-called bootstrapping -- launching a business by funding it themselves along with help from friends and family, and keeping it as lean as possible until they can attract venture capital investment. The few who can lure investors today are regarded as having won a lottery of sorts -- one made possible by their own sweat equity, and not by chance.

"It's tough to get funding right now, so we're keeping our day jobs and working on it on nights and weekends," said Brian Tomasette of Baltimore, co-founder of SocialRoster.com, a networking Web site for athletic leagues. "Essentially, we found that VCs [venture capital firms] just aren't investing."

The bad news, for the moment, is that the venture capital industry is in the worst shape since the dot-com bubble burst in the beginning of the decade. Entrepreneurs and leaders of small businesses across Maryland have largely been put on hold as investors became tight-fisted and more demanding, and banks are still stingy with extending credit.

But feisty startups that can attract investors and weather the storm are perfectly positioned for success once the economy emerges from recession.

"Downturns can be good. They wipe out inefficient firms," said Louis P. Galambos, professor of economic and business history at the Johns Hopkins University. "Only the strong are going to survive in this, and they're the ones who are going to get capital."

Before the recession, investment experts said, the cycle of funding startup ventures followed a general pattern: Entrepreneurs with a track record would attract early-stage, or so-called "angel," investors who'd pump vital cash into an enterprise to get it off the ground. The company, perhaps with little more than an idea and a small management team, would get a cash infusion in exchange for handing over a piece of ownership to investors.

But that all changed with the stock market dive. The net worth of affluent, risk-taking investors who normally liked to fund startup ventures dropped with Wall Street's losses. Suddenly, entrepreneurs who were counting on these angels to help them become the next Google or Microsoft were faced with an austerity that hadn't been seen since the start of the decade.