Colorado VC Investing Up 48%? C’mon

There’s no way the headline “VC investment up 48% in 2005″ from the Denver Business Journal is correct. I seem to recall Brad saying early last year that there were some large buyout-type tech deals in Colorado that were getting wrongly counted as venture deals. Brad, am I right?

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  3. Dialing Back the BTUs in Clean Tech Investing
  4. Collusion in Private Equity
  5. Silver Lake Speaks

Comments

  1. Dan Primack says:

    i just checked the database… it’s correct. $108m for webroot helped out a bunch, but the overall numbers are $413m for 2004 and $611m for 2005. these are all for pure VC deals…

  2. Paul K. says:

    Fair enough Dan, but back out $108m for Webroot — which was an anomalous deal — and you have things up a somewhat more believable (but still impressive) 22%.

  3. Brad Feld says:

    I haven’t looked carefully at the numbers (I generally think they are silly stats anyway). There are two that I think are inappropriately counted: 1: Webroot, 2: Cornice.
    1: Webroot. This was a buyout of the founders and much more of a private equity type deal than a VC deal. The actual money that went into the company was less than $20m. While there are no rules for normalizing this data, any reasonable person would recognize that this skews the numbers dramatically.
    2: Cornice: As I haven’t looked at the data, I’m less certain on this one. However, when the funding was announced, everyone seemed to include the venture debt portion of the deal (which was substantial.) If this WAS included in the number, it shouldn’t have been.