VCs and Demo

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.


  1. hey Paul,
    i’m here at demo this year ’cause my portfolio company, eqo (, just launched a cool service here which extends skype onto your mobile phone. check it out if you’re a skype user.
    but fred is right, this place is crawling with VCs (of the US variety, only 2 Canadian VCs here I think), and definately is not a place for VCs to find deals. but, seeing the companies does give you some sense of trends….like there’s a gazillion photo sharing/management products still trying to make a dent in the world!

  2. Thanks Jenny. Will have a look.
    Wrt Demo, I’m much happier here in La Jolla where it’s sunny, warm, and VC-free (present company excluded).