I love the start-up world. I love working with founders and young companies. I love the excitement of working on business ideas that are new and different. I love seeing the success that often comes from this hard work. I’ve never before in my professional life seen a time of such innovation and creativity. At Foundry we see more business plans now than we ever have. And what’s more, more of those business plans are really interesting (and fundable). It goes without saying that I love the business of venture capital. I love helping entrepreneurs work on their ideas. And I love helping companies figure out how to become as successful as possible. I love the challenge of trying to…
Category
Venture Capital
Is there age bias in VC investing?
I recently waked into a pitch meeting for a social networking related business and was surprised by what I saw. I had interacted with the entrepreneur over email – taking a look at the initial business plan and setting up the meeting – but we hadn’t met in person before. In front of me were three guys in suits, each in their late 40’s or early 50’s, with an older Dell laptop and a paper print-out of some product ideas. And as I sat there listening to their pitch I couldn’t help but think about how differently I might have reacted if this team was in their 20’s or 30’s, dressed in full tech/nerd hipster outfits (or at least jeans…
The real bubble
While there’s been plenty of discussion and debate about whether we’re in some kind of valuation/venture bubble right now for early stage tech, there is one bubble that I’m pretty sure of. I’m seeing more great business ideas right now than I can remember seeing at any time in my 10 year venture career. We typically see around 1,500 business plans a year at Foundry (we actually see more than that, but this is the approximate number that are relevant to our investment focus). On average we’ll take a meeting with somewhere around 10-15% of these and hear a bit more than what was in the introductory email or initial business plan. And we typically invest in 8 (our Foundry…
The new era of venture capital
You already know the about the state of the venture capital industry in 2009: venture investing down (32%), exits down (14%; slowest exit year for VC backed companies since 1995), fundraising down (56%), IPO’s almost non-existent (8 venture backed IPOs in 2009). It’s a bleak picture for the industry overall, even if there’s a group of us that continue to believe this is a great market in which to be investing (and it clearly is). These stats got me thinking about the future of the venture industry and I thought I’d offer up some thoughts on where we might be headed. First, let me frame the conversation by stating that I agree with Fred Wilson’s assumption that somewhere around $15Bn…
VCIR Success – by the numbers
This is a cross post from the VCIR blog. We recently put together an analysis of companies that have presented at VCIR over the last 10 years. And the numbers are pretty impressive – reinforcing why the conference is such a great opportunity to see great companies from around the rocky mountain region. For more information on the conference itself, including how to register, visit the VCIR Winter website. VCIR By the Numbers: Presenting companies: 212 Companies who raised additional funding after their VCIR appearance: 127 Total funding raised by these companies (only includes amounts raised after their VCIR presentations): $2.5 Billion Presenting companies acquired: 29 Total acquisition value (includes announced values for 19 of the 29 transactions): $4.4 Billion…
The VC Model is “broken” (again? yawn!)
In the latest lob into the morass that has become somewhat of a sport amongst journalists and those that follow the venture capital industry, Carl Schramm and Harold Bradley write in BusinessWeek about “How Venture Capital Lost Its Way”. The evidence? Venture capital funding is down – from an “astonishing” 1.1% of US GDP in 2000; and in the 3rd quarter of 2009 down 33% from the same period a year earlier. To add to Schramm and Bradley’s collective horror, “two areas crucial to American progress cry out for capital-intensive investment: clean energy technology and biotech. And the VC industry isn’t delivering it. (Info tech, which by now requires few capital investments, still accounts for the lion’s share of those…
Putting entrepreneurs first
Shout-out to Sequoia for featuring Omar Hamoui on their home page today (he’s the CEO of AdMob which was acquired by Google today for $750M). Well done!
Don’t Panic!
I was recently talking to someone about an issue in one of their portfolio companies (this was not a Foundry or Mobius company). The issue was pretty serious (it related to safety standards at the company that were being ignored and a resulting accident at the business) and the person relating this story was (understandably) pretty worked up and asking me what I thought they should do. My advice? I can’t say that I come by this naturally (I can be pretty excitable) or that I was a particularly good practitioner of my own advice earlier in my venture career, but I’ve managed to reign myself in and strongly believe that the priority in any interaction is simply to not…
VCs and social media
I recently participated in a Thomson Reuters webinar entitled "Boosting Returns with Web 2.0 Technology". The seminar was targeted to VC and Private Equity professionals and focused on how investment firms can use social media in managing their investment business. I was reminded of the mew media technology bubble that I live in a few months ago when I spoke on a similar topic at the PEI Investor Relations and Communications Forum. When I asked the crowd of about 150 people how many were on Twitter and a single hand went up I realized that I had my work cut out for me (I might have guessed that that when I walked into the room and was the only person…
Venture capital is dead! Long live venture capital!
Dan Primack sited a study on PE Hub today that found that over 50% of VC professionals believe that the VC industry is “broken”. My response: WHO CARES? Seriously. It seems like the venture industry these days spends more time lamenting its future than actually working towards a future that’s different. And they couldn’t be more short term in their perspective. VC sentiment has started to become like consumer sentiment – something that moves on a monthly basis. Are we forgetting that our business is about spotting long term trends and funding business cycles that are measured in years, not months?!? It’s possible I’m simply in the wrong demographic (almost 85% of the respondents were east- or west-coast VCs), the…