"In economic development theory . . . you either are attracting people to come to your place, which is sort of economic hunting and gathering," he said, "or there's economic gardening, which involves using the assets you have already and growing those."
The 39-year-old CEO of $50 million venture capital firm Jove Equity Partners is placing a personal bet that the "gardening" approach will grow Long Island's economy.
"We will have a very difficult time in the foreseeable future, given the cost of living here, attracting businesses to come," Calone said. "Our resources are best put toward the existing businesses, and helping new companies be created."
Long Island lags behind many other areas in the nation in the effort to help build new companies. The Island is still off the radar of many venture capitalists, and often overshadowed by New York City, which has developed into a start-up hot spot.
In 2012, four Long Island companies received more than $20 million in venture capital funding. In contrast, New York City, which has ramped up its efforts to cultivate a "Silicon Alley" in recent years, received $1.5 billion in investments for more than 250 companies in that period, according to data from the MoneyTree Report, compiled by PricewaterhouseCoopers and the National Venture Capital Association.
From October through December -- the most recent quarterly data -- Long Island companies received no venture capital investments. In that same period, California's Silicon Valley -- long a hotbed of start-up activity -- received more than $2.5 billion in venture funding.
Start-ups contribute to job creation, which has been sluggish on Long Island. The local economy, which employed 1.37 million people in December, added only 2,700 jobs that month from a year earlier.
Officials and business leaders on the Island have pushed through a string of initiatives in recent years, seeking to make the area more nurturing for innovative research and start-up companies.
In the past year, Calone has become increasingly involved in that effort. In December, he was appointed to the board of Accelerate Long Island, a new organization that works to help create new companies by connecting local scientists and entrepreneurs. He is also one of a trio of investors who have put forth a combined $750,000 toward the Long Island Emerging Technologies Fund -- which seeks to finance the development of promising ideas into companies.
"David's a national player as it relates to running a venture capital fund that invests in tech companies," said Mark Lesko, the executive director of Accelerate. "He's one of those guys that's kind of tapped into the community . . . all the main players are on David's speed dial."
Calone brings six years of experience at Jove, investing in start-ups across the United States, building companies in the fund's portfolio, and advising as a co-inventor on 10 patents.
"I do business around the country, and Long Island has unique assets," Calone said. "We have the intellectual capital of the research labs" including Brookhaven National Laboratory and Cold Spring Harbor Laboratory, "we have the proximity to one of the great cities of the world, and we have a well-educated workforce.
"But Long Island needs to use them in different ways because the world is changing and we're competing internationally," he said.
Came back to Long Island
A native of Mount Sinai, Calone left Long Island in 1992 to attend Princeton University and then Harvard Law School. He worked as a prosecutor for the Department of Justice specializing in international economic crime and terrorism, working cases that involved company raids in Milan and serving on the team that prosecuted al-Qaida member Zacarias Moussaoui for conspiring in the 9/11 attacks. He later worked as a prosecutor for the state of New York, where he helped negotiate a $76.5 million settlement over fraudulent Medicaid billing, one of the largest in the state's history.
"I always liked observing companies and how they grew," he said. "When I was in the Justice Department, we investigated companies . . . and how they work. And I thought that was really neat. So I sort of said 'Hey, at some point I'd really like to be involved with that on the private side.' "
That opportunity came when he was hired to oversee Jove, a fund that manages money for the family of a friend (it is closed to outside investors). He helped build Denver-based BridgeHealth Medical, a Jove investment, which helps patients understand and control surgery costs, from an idea on a piece of paper to a multimillion dollar business with more than 40 employees.
Social Intelligence, a Santa Barbara, Calif., company that provides social media background checks, had about a dozen employees when Calone made his first investment -- it now employs around 100.
Calone moved back to Long Island in 2006 -- his first daughter had just started crawling and his Brooklyn apartment "got really small, really fast." He lives in Setauket with his wife Kate, a Presbyterian minister, and their three children -- Sarah, 7, Peter, 5, and Meg, 1.
He came back, he says, because he saw Long Island as the best place to raise his children. They provide a motivation for his work to aid the local economy -- he wants a better, more prosperous place for his children to grow up in.
Calone believes there is innovation on Long Island that can be built into successful companies -- the key is time and finding the right entrepreneurs.
"Some of the stuff in the biosciences is amazing here on Long Island," he said. For example, he points to cancer research and new methods of fighting viruses at Cold Spring Harbor Lab as projects with "tremendous potential." He gave a talk there last month, advising scientists on how to pitch their inventions to investors.
Calone's investments and activities span the country.
Two weeks ago, he was in Washington, D.C., moderating a panel on the entrepreneurial "ecosystem" as an organizer of the bipartisan Congressional Caucus on Innovation and Entrepreneurship. The event, held for lawmakers to better understand the innovation economy, was attended by members of the House of Representatives and staffers.
A day later, he was back on Long Island, giving tips to three start-up companies housed in the LI Tech Mall in Hauppauge.
Last week, he presented his views on how Long Island can take advantage of economic gardening to the Suffolk County Legislature -- a day after he closed an expansion deal for one of Jove's portfolio companies based in California.
On Long Island, he has been long involved in local government, serving as the chairman of the Suffolk County Planning Commission since 2008 and as a Long Island Power Authority trustee from 2009 to September 2012. There, he helped identify gaps in the utility's operations, leading to a restructuring plan. The power company was widely criticized for its slow response restoring power after superstorm Sandy.
People who have worked with Calone say his civic involvement and experience with law and venture capital are complementary.
"We've been working together to look at different models on how we can pay for bringing sewers to Suffolk County," said Legis. Wayne R. Horsley (D-Babylon). "He's showing us economic models on how the county can move that ball forward."
Political players on Long Island have said a run for office would not be out of the question for Calone. But for the time being, Calone says his focus is working with entrepreneurs and helping tend to Long Island's economic garden.
"I've seen Long Island change from when I grew up here in the '70s and '80s," he said. "I felt like I had something to contribute in terms of helping Long Island's economic development and planning for the future."
NAME: David Calone
HOMETOWN: Mount Sinai
CURRENT RESIDENCE: Setauket
JOB: President and CEO of venture capital firm Jove Equity Partners
EDUCATION: Princeton University, Harvard Law School
PATENT PORTFOLIO: Co-inventor on 10 patents, most related to Internet messaging
MOMENT OF FAME: Winning the NBC game show "The Weakest Link" in 2001 and taking home $83,500
FAVORITE LI EATERY: Mario's in Setauket
FIRST LI JOB: Worked at a toy store in downtown Port Jefferson, which entailed dressing as a ninja turtle to attract customers on the street