Demo is a great conference. Super professionally done, oodles of new companies, and well hosted by the estimable Chris Shipley. While I’m not there this year, it’s still info-crack on the newswires for new-new thing addicts like me. But Demo’s arguably not a great place to go looking for venture investments.
Why? Because there are so many other venture investors galumphing around doing the same thing. Fred Wilson thinks there are 50-60 VCs at Demo this year, which is terrifyingly high. Unless you’re either willing to compete on price (a path to lower returns), or you’re a first-tier fund (you don’t have to (always) compete on price), you’re not likely to be cheap money into any well-received company.
Granted, something similar happens to most hot deals in the real world, but at least then you had a chance to be first. So here’s my view for VCs: For sure attend, and certainly send your portfolio companies to Demo — just don’t find them there.