Peter Lo Yat-fai, chief executive officer of the Hong Kong Science and Technology Parks, says: 'I think their approach is now different from the dotcom days - or craze - when a large number of venture capitalists were prepared to invest in an indiscriminate manner, regardless of the business or the business model.

'In those days the situation was less rational, but I think there's been a misconception following the collapse of the dotcom era. People think there's been a total contraction of venture capital. This is wrong. There's a fair amount of capital available for investment. The approach now is more selective, more discriminatory, in the sense that venture capitalists will avoid projects that don't have a decent business model.'

TechWorld is designed to foster relationships and deal-making between small- and medium-sized business and the investment community - the so-called venture capitalists or angel investors.

The event opens today and runs until Wednesday at the Hong Kong Convention and Exhibition Centre in Wan Chai, and is being organised by the Hong Kong Industrial Technology Centre Corporation.

A key component of the event is a business-matching programme designed to bring potential partners together during closed-door sessions. More than 600 meetings are scheduled.

Mr Lo says the idea is to get the right people together in a setting that encourages frank discussion.

'By putting together all these people, businessmen, entrepreneurs or techno-preneurs and arranging one-on-one meetings, we draw together suitable partners in a quiet environment,' Mr Lo says. 'Many of these companies are keen to meet many potential partners.'

Some companies will be demonstrating products while others will attend just for the networking opportunities. More than 296 companies are participating. Of these, 137 are from Hong Kong, 86 from the mainland and 73 from overseas. Foreign firms will be representing Singapore, Japan, Taiwan, New Zealand, Malaysia, Finland, Israel, Britain and the United States.

The event is geared towards technology companies, with more than 64 per cent of firms hailing from the IT industry. Electronics represent 16 per cent, while biotechnology and environmental firms represent 13 per cent of participants.

Mainland companies from Beijing, Shanghai, Guangzhou, Shenzhen, Zhuhai, Xian, Xuzhou, Naning and Zibo are also represented.

More than 40 venture capital firms are expected to take part, mainly from Hong Kong and Singapore.

Organisers say corporate participation can be divided roughly into five classes. These include firms working in information technology, telecommunications, microelectronics, multimedia and networking.

As part of the event's agenda, the Hong Kong University of Science and Technology has organised a number of seminars on commercialising technology and new ideas, with several guest speakers leading the seminars.

A key theme at this year's event is the prevalence of firms looking for mainland opportunities.

'Increased enthusiasm is seen by the number of participants,' Mr Lo says.

'A number of factors are contributing to a positive perception of the Asian technology market. First and foremost is China's accession to the World Trade Organisation. This has focused a lot of companies on their Asian investment strategy, particularly in the hope that China's accession to the trade body will lead to a progressive opening of the China market in both goods and services.'

As venture capitalists are being more attentive to the viability of new businesses, Mr Lo expects a reduction in the colourful concepts that have dominated such events in previous years.

For example, a potential winner this year are firms that specialise in repackaging software in Chinese - a concept that would have been considered unimaginative less than two years ago.

The organisers admit these concepts are not the paradigm-shifting crazes that made headlines in 1999, but they could be the right recipe for the market's present mood.

'There's no need to talk about investments in cutting-edge technology or high-tech ventures,' Mr Lo says.

'The emphasis at the fair could simply be commercialising mid-tech projects. I am not too concerned about the availability of capital. The important thing is whether the projects can provide the potential for development, leading to successful ventures.'

Mr Lo expects manufacturers and software developers to focus on consumer products, especially wireless devices.

The next frontier of development may not be dazzling 3G concepts but rather simple ideas about how better to integrate technology into daily life.

Twenty companies from the government's business incubation programme are participating at TechWorld, with more participation from government-sponsored companies expected in the future.