Venture capital
From another one of Paul's guest bloggers for the next two weeks...There was a fair amount of of blog-borne back-and forth today over Adam Lashinksy's piece in Fortune on Kleiner Perkins, and its pursuit of clean tech and other energy...
Google has some curious results now and then. For example, if you search for the string "venture capital" in Google you'll find 79mm results, but surprisingly few major venture capital firms -- including neither of the two Google VCs: Sequoia...
Venkman: This city is headed for a disaster of biblical proportions.Mayor: What do you mean, biblical?Ray: What he means is Old Testament, Mr. Mayor... real Wrath-of-God-type stuff. Fire and brimstone coming down from the skies.Venkman: Rivers and seas boiling!Egon:...
Sign XXXIV that we are in some kind of a technology mini-bubble, the BBC is back filming venture guy Steve Jurvetson at Buck's in Woodside. Here is Steve's commentary on that "deja vu" moment for him:The BBC is back, filming...
Anyone out there with some insight on vast.com? I have had a few people tell me that I should know about about them, but I know next to diddly. A small-ish group of smart folks with some interesting ideas &...
If this is true, it's nuts:The rumors are flying that Meebo, all of 13 weeks old, has raised money [from Sequoia] at a $10 million pre-money valuation. I'll say straight up that the Meebo guys, in addition to seemingly being...
In passing, Dave Hornik at August Capital made the following comment yesterday in an otherwise unrelated post: Saying "Long Tail" is like saying "viral" or "search engine optimization" -- the concept is part of the standard parlance for VCs and...
I increasingly feel as if many VCs are smelling an implicit “put” option in the current technology takeout fever. Every time a revenue-less del.icio.us, or equivalent, is taken out by Google-Yahoo-Microsoft (GYM), it emboldens venture investors, especially first-tier sorts, to think...
Say what you will, but mall carts and kiosks are a clever idea — using interstitial retail white space to flog products and services — and it has turned into a $10-billion business. Granted, in one mall here in La Jolla...
The National Venture Capital Association has its venture capital predictions out for 2006, and it took me only until the first prediction to guffaw: More-informed risk takingRisk taking will remain the cornerstone of venture capital but it will become much...
The following comment is from some who spent a year recently unsuccessfully seeking venture capital. It was directed at my post about changes in the venture industry, but it was useful enough that I decided it should be a post...
Two definitions/phrases that I often use in talking about and meeting with entrepreneurs: box canyons: Successful entrepreneurs are skilled at racing hard at brick walls. There is, after all, no point in parcelling out capital slowly to try and stay...
Sometimes when you play provocateur people lie down and agree, which can be a little disconcerting, as a moderator discovered in a recent panel at Harvard on the future of venture capital. He said that the industry was screwed, and...
The offline real estate boom may be slowing, but the online boom continues, as a John Cook survey piece in today’s Seattle P-I demonstrates in passing by mentioning many of the companies, from Redfin, to iGenHome, to Zillow. Most of...
From VentureWire, it seems that Pennsylvania has given venture investors a "put" on investments in that state. If they lose money on venture investing, well ... they can put 50% of the losses back to the state. Assuming I haven't...
Truer words were ne'er said about venture capital success than these by Bessemer's David Cowan: The first person I ever met from Bessemer was Neill Brownstein, one of Silicon Valley's pioneer venture capitalists (with investments like Ungermann Bass, Telenet, Maxim,...
From a grounded presentation by KPCB’s Vinod Khosla on what works and what doesn’t in venture capital, these two figures compare the pre-bubble and bubble funding model. One is fully funded before all the risks are out, while the other (pre-bubble) starts...
The WSJ says tonight that a 29-year-old AOL staffer who headed up the firm's instant messaging group will jump ship to venture firm Mayfield. The paper (and Mayfield) say that it's about kicking up the firm's consumer Internet emphasis. Given...
Venture guy Tim Draper of DFJ is an ever-entertaining fellow, and in this video interview he offers up a typically Tim rationale for how DFJ approaches risk. After all, his firm is known for taking on some riskier than usual...
There is a mildly entertaining video out of venture guy John Doerr explaining the dimensions of the Web 2.0 bubble boom to ZDNet Editor Dan Farber. Doerr is a very smart and savvy guy, someone who could buy me one...
Fred Wilson of Union Square has an ongoing series of VC cliches, to which I'd like to add the phrase, "You'll get funded". It is one of those irritating and frequently used bits of VC emptiness, a way of praising...
In an otherwise unremarkable WSJ piece about the silly bidding war going on among Yahoo, Microsoft, Amazon, and Google for top scientists and engineers, there is this fascinating rationalization from Alan Eustace of Google: One top-notch engineer is worth "300 times...
No company should have a senior management or board discussion concerning the success, or lack thereof, of their current marketing programs without presenting data on the following: The top five site referral words/phrases from Google searches (and how that compares...
I had a group come by recently and pitch me that the Next Billion-Dollar Thing on cellphones is … clip art. Ringtones, they argued, were only one part of personalization, and a passe one at that. The next frontier, to...
Does Google have a VC fund for early-stage companies? John Battelle said so yesterday, and then posted a subsequent update saying sources inside the company deny it. So, which is it? The correct answer: Yes, of course Google does. It's...
John Cook of the Seattle P-I noticed something synchronous about three recent technology company financings in Seattle:But ... what is it with raising $8 million? Is it just a coincidence that Seattle area startups Judy's Book, BioPassword -- and now...
I had two experiences this week with VCs who mishandled saying No. In both cases someone had approached a portfolio company, looking to invest, only to screw up their decision to demur. In one case the would-be investor gave a...
There have been enough rumors over the last couple of days that you could have turned it into a drinking game. But I now see speculation on Om’s blog, as well as over on Niall’s site, so, with a caution...
I was reading an article this morning on the venture industry in Electronic Business magazine and I was, in two words, put off. Why are people still writing dated, proto-cyclical yap-yap about how venture folks are back to basics, that...
In writing an email the other day I mentioned a certain top-drawer VC and was surprised to see their surname not flagged as a spelling error in Microsoft Word. Howzat, I wondered? My surname, Kedrosky, is a spelling error in Microsoft...
From Dan Primack’s PE Week Wire, the following factoid is astounding concerning private equity powerhouse Carlyle Group: …Carlyle spent around $500 million in I-banking fees over the past year. ...
The whole "Bill Gates of ..." meme is so cliched and irritating that, on principle, I almost skipped a piece in the current BusinessWeek ("Imagining the Next Bill Gates") about trends in biotech. Anyway, the piece is worth reading, mainly...
It's a little known-stat, but one that is highly vexing in biotechnology venture investing: Better than 60% of "B" rounds are down rounds. Translation: More than half the time when the second major chunk of capital is put into a...
Instantly create your own Web 2.0 company! No water needed. Perl and Apache not provided. Your traffic may vary, etc. Here is a company I just created and am quite fond of: Your company name: Yahoodoo Your company product: tag-based...
Dobbs: "If you're the police, where are your badges?" Gold Hat: "Badges!? We ain't got no badges. We don't need no badges! I don't have to show you any stinking badges!!" --Alfonso Bedoya in Treasure of the Sierra...
Bill Burnham has a thoughtful post up today on the subject of serial persistence of returns from venture investing. The idea that top-tier venture firms in any period, unlike mutual funds, stay in the same performance tier in subsequent periods...
IBM finally learned how to snatch the pebble from Kan's hand, at least when it comes to venture capital. How do I know? Because it now no longer participates in venture as an active investor. Smart, but it dropped a...
Joshua Jaffe offers up more fuel for fans and critics of the build-to-flip view of Web 2.0:Corporations aren't just the clear choice now for venture capitalists seeking to sell their portfolio companies. The big high-tech companies are also beginning to...
For those of you in Vancouver and environs, I’m giving a Web 2.0–ish talk (maybe more like a throat-clearing, given that I’m only allotted fifteen minutes) at a Vancouver Enterprise Forum get-together on Tuesday of this week. It’s in some golf-ball-shaped building...
Dorrian Porter has an appropriately wry and jaundiced take on the current goofy ardor among some “entrepreneurs” (I use that term advisedly) to advertise for fellow founders: …I don't understand why some really smart people want to attract to their own...
From the latest E&Y/VentureOne data on third-quarter venture capital activity, there are only five U.S. states in which there has been no venture capital invested so far in 2005: Kansas, Montana, Nebraska, North Dakota and South Dakota. Yes, some will...
Some marquee private equity folks on-stage at the upcoming “Leadership in Private Equity” forum in New York. It is not often you have Alan Patricof, Steven Rattner, Samuel Zell, and, the most secretive catch, David Shaw, all up-and-talking at the same...
Lots of people punning about Flock now that the somewhat stealth browser-thingie is in wider beta. I have to confess, however, that I’ve messed with it and been largely unimpressed. It is nowhere near as feature-rich as my preferred browsing...
Not to turn this site into All Dan Loeb, All the Time, but there is an entertaining profile of the poison pen fund manager in Bloomberg Markets magazine [courtesy of Daily Dose of Optimism]. While Loeb’s brush with Bob Marley...
There is a quaint joint interview will billionaire bridge- and poker-buddies Bill Gates and Warren Buffett in the current Fortune magazine. Among other things (books, weight loss, philanthropy, and the S&P 500 outlook), Gates opines on the outlook for venture...
There is an unusual story out today about a venture firm retaining a public relations agency. Why unusual? Because a) it is not common for venture firms to have PR agencies in the first place, and b) the piece contains...
I was scanning John Battelle’s book “The Search” today in a bookstore and I ran into an anecdote I hadn’t heard before. While I knew Andy Bechtolsheim was Google’s first angel investor, and I knew the investment happened quickly on...
There is a Matt Marshall piece in today’s SJ Merc beating the drum about the surplus of cash available to hot-hot Web 2.0 companies. I’m not going to touch that issue, as I’m not really sure there is anything new...
Fred Wilson and Brad Burnham have “flipped the switch” on their Union Square Ventures website and gone all blog, all the time. Here is their rationale: We realized that our [investment] thesis evolves incrementally as a result of our dialogue with...
From a smart entrepreneur I spoke to yesterday: Yeah, I went to Web 2.0 and I saw the companies presenting. Basically, I just looked at it as gratis feature demos for ideas on stuff that I might want to incorporate into future...
From a post by venture guy Steve Hall of Vulcan Ventures on things he saw on laptop screens around him at Web 2.0: By doing some casual monitoring of the numerous laptops around me in the audience, I discovered: A...
Great and visceral post from EVDB founder Brian Dear about his unease with last week’s Web 2.0 conference. While he and I talked about some of this in person in San Francisco, his post (the second of three) is great...
“We were somewhere around Barstow on the edge of the desert when the drugs began to take hold.” – Hunter Thompson, “Fear and Loathing in Las Vegas” Congratulations to the four teams that completed the DARPA Grand Challenge...
I had an entertaining conversation at Web 2.0 with the CEO of a well-known venture-backed company. While he has marquee investors, one of the investors is even more marquee than the others (if that makes any sense), but has a...
I wasn’t going to mention it, but the spate of other bloggers disclosing that they have recently been approached by venture folks made me feel like I should tell the story. Like a number of other people writing for the...
Having been accused in a comment of running a “Web 2.0 Week“ here at Infectious Greed, I thought it best to just rename the site: Infectious Greed 2.0. I’m kidding. More seriously, the ideas underlying any supposed change are what’s...
I see from the latest NVCA venture-backed IPO data today that the number of public offerings in 2005 will likely undershoot the same figure from 2004. (And both figures together don’t add up to the CY 2000 figure.) That is...
Interesting that shortly after the final close of the Bono-including entertainment-centric private equity fund Elevation Partners we have news that ex- Battery guy Todd Dagres has closed his own entertainment venture fund, Spark Capital (which has an incredibly annoying Flash-centric site)....
A reader made some provocative comments on an earlier post about Web 2.0, so I’ll repost them here: As much as I love trying the new technology and services, very little has changed in how I use the web. Only...
I had an interesting conversation with the CEO of a venture-backed company recently where he “explained” why CEOs of such firms need to be paid more now than an inflation-adjusted increase from, say, five years ago. He argued that in...
While it’s goood to be KPCB venture guy John Doerr (#346 on the Forbes list of 500 wealthiest Americans), it’s worth putting it in Brin/Page terms. Doing the math, 1 Brin/Page = 11 Doerrs, or 330 places on the Forbes...
I’ve consulted to a couple of emerging venture managers and first-time funds, so the following excerpted email from an LP to Dan Primack about emerging venture fund managers caught my eye. Among its other merits, the piece is true and is therefore...
Leapfrog’s Peter Rip has, like many of us, been running into AJAX (or Flash, or Flex) re-dos of Office software components lately. The trend toward desktop-software-less office tools continues apace. AJAX Office is Everywhere! Wow. In the past three days...
There is a mordant piece in Bloomberg news today about the current penchant among some monied sorts for diverting themselves by buying up large pieces of Montana. Chief among them, two partners from venture firm Sequoia: Regulars who gather [in Whitefish...
I’m entertained by the chimp talk about venture capital breaking out everywhere. (Sequoia’s Mike Moritz recently was quoted as saying that even a chimpanzee could raise a $100mm venture fund.) Not surprisingly, Mike’s comment has people alternately turning tickled, defensive,...
While I don’t entirely agree with topic ordering in this New York Angels example of how to arrange your pitch, it is far better than most. The biggest mistake that it doesn’t make is that it avoids the no-no of putting...
Perhaps the most common question I get on this site, right up there with “Will you invest in my consumer software startup?”, is “How do I become a VC?” I am always tempted to paraphrase J. Paul Getty and say,...
The following is from a piece in today’s Mercury News on how various VCs — including the other Draper firm, not that Draper firm — did on their Skype investments: Together with his partner [Howard] Hartenbaum, [Bill] Draper invested about $250,000 into...
Most analysis of recent data showing that startup valuations are up 16% year-over-year draw a dubious conclusion. They persist in saying that the companies are more valuable, as opposed to saying that they are more expensive. There is a difference...
There are some savvy comments in a TheDeal piece about “the anointed” venture investing firms — Sequoia, Kleiner, etc. — and whether such firms will continue to dominate the industry. Consider this musing on firms and returns from an endowment fund...
Today’s Wall Street Journal contains an article on so-called next-generation price comparison sites. While I’m a big fan of such things — I’ve been looking hard for investment ideas in the area — and I used Pricegrabber extensively in two...
Brad Feld’s venture capitalist-perspective commentary on CEO-firing best practises — every day when you wake up ask yourself if you support your CEO, and if you don’t, then fire him/her — reminds me of a classic Westley moment from The Princess Bride:...
I felt a great disturbance in the Force, as if many venture capitalists suddenly cried out in terror and were suddenly silenced. Ontario, Canada’s largest and most populous province, has announced it will axe venture capital tax credits, a...
From a Technology Review interview last year with venture guy Mike Moritz: TR: How about "first to market"?MM: An utterly dreadful phrase. I way prefer to focus on how a company becomes first in market....
I’m entertained by Business 2.0’s new contest (?) whereby various namebrand VCs have posed business & technology problems around which they would like to see companies built. The ideas range from a co-op service for banks, to fraudproof credit authorization for...
The return of Bill Gross has been heralded for so long that it sometimes starts to feel like Randall Stross’s wonderful story about how journalist kept calling Steve’s Jobs company Next a “startup” six years after the company was founded....
Matt Marshall quotes Peter Rip of Leapfrog Ventures in an expansion of his MercNews piece from yesterday on the wind of creative desctruction currently blowing through VC-land. I generally agree with what Rip has to say, especially his comment that...
In quasi-venture capital news, Fresh Air’s Terry Gross has an interview today with Neil Clark Warren, the Evangelical Christian founder of online dating service eHarmony. Recall, about eight months ago eHarmony landed a $110–million venture round (well, more like a private IPO)...
From Charlie Wood’s blog, this excellent guerilla-style (but practically-minded) guide to real-world product management: With limited resources, an organization has to find a way to ruthlessly optimize its product development process. My personal product management philosophy is tagged in my...
Matt Marshall uses the recent developments at Lightspeed Capital and Mayfield (the former is bifurcating; the latter lost a few prominent LPs) to argue that the venture industry is going through a cycle of Schumpeterian “creative destruction”. I don’t disagree,...
Nivi has noticed something remarkable on Craigslist: I was recently looking through craigslist’s Bay Area computer gigs for engineers on a project I am working on (codename: Ninja). And I was blown away by the number of people who are...
Jeff Bussgang has a nicely done post on how entrepreneurs and VCs view time differently. The former see it as their enemy, and the latter are almost always happy to wait and get more information before making an investment: And...
One of the most misunderstood and screwed-up areas in business has to be probabilities. People constantly attribute to skill that which can be explained by luck (CEOs getting overcompensated because their stock has risen in a twelve-month period), and they...
From BusinessWeek, perhaps the worst-kept secret in technology, that Skype is officially on the block, albeit with the tidbit that Morgan Stanley is running the book and an IPO is more likely than a sale: Skype: On The Block Skype,...
According to Dan Primack of PE Week Wire, the Adam Curry-founded PodShow.com has received venture funding from the twin towers of venture capital, Sequoia and Kleiner Perkins. The two firms have apparently participated in an $8.5mm series A financing, one...
It hasn’t been trumpeted as much here in the U.S., but it’s only a matter of time. The subject? The supposed brain drain from corporate executive to private equity. In the U.K. there has recently been a series of high-profile...
I ran across a classic 1993 piece from Financial Analysts Journal today on the subject of consensus, forecasting and investment returns, and it has some points worth repeating. Let’s start with the following: Everyone’s forecasts, taken together, form the consensus forecast....
You had to know this was going to be one of his main subjects, but venture guy Bill Gurley’s Next Big Thing Q&A in the FT today includes an ode to the wonders of MMOGs (massively multiplayer online games), a...
Today’s Washington Post has a “two data points makes a trend” piece on the supposed rise of do-goodnik venture investing. Trouble is, the article contains virtually no data to support its point — that Silicon Valley sorts are now trying...
There is a cornuccopia of predictable “tenth anniversary of Netscape’s IPO” features floating around, from Fortune’s solid & interesting editorial package a few weeks ago, to a strange “Ask Bill Gurley” piece in today’s Financial Times, to a generally anodyne editorial...
A Boston Globe article today makes it sound like it’s raining money in the venture fund-raising game: Five years after the dot-com bust, venture capital and buyout firms are in the midst of a new wave of fund-raising. Firms closed...
In case folks haven't seen it, Chris Anderson is saying that things were askew in his original "long tail" analysis. Instead of 57% of Amazon's sales coming from products in the long tail (i.e., outside the top 100,000 books), it...
There is a “two-points-makes-a-trend” (okay, four) piece in today’s Times on founders cashing out during venture investments. This would be interesting, if true, as VCs are usually chary about letting incoming capital in an early-stage financing round go to the company...
I’ve been spending time lately mulling over models of shotgun versus rifle strategies in venture investing. Put differently, I’m looking at the differential performance from investing by taking a category-covering strategy (shotgun), versus being highly selective and trying to put...
Apparently Seattle-ites are just as fond of stealth startups as the sneaky boys and girls down here in California: Venture Capital: Startups are coming back -- quietly By JOHN COOKSEATTLE POST-INTELLIGENCER REPORTER Here's a sign that Seattle's startup community is...
Jeff Nolan asks a question that occurs to me every time I’m up in the Valley for meetings: How is it that the Silicon Valley has the worst damned cell coverage of any major metro area? And the most bizarre...
If any Infectious Greed readers are at the always interesting Siggraph conference in Los Angeles this coming week, it’s looks like I’ll be there Monday/Tuesday. I’ve been attending Siggraph off and on since the mid-1990s (Orlando 1994 was my first),...
Earlier this week I posted some data showing that the median return of top quartile venture funds was well ahead of the median return of second-quartile funds. At the same time, the gap between second-, third-, and fourth-quartile funds was...
Bill Burnham has a provocative comment on my post about skewness in venture capital returns. I’m replying to Bill with a full post later today, but I for now I’ll simply point people to Bill’s thoughtful missive....
Only in Washington would an agriculture committee (okay, the Rural Enterprises, Agriculture and Technology Subcommittee of the House Small Business Committee) be holding a hearing on the role of venture capital in biotechnology. There are some interesting folks presenting, and...
In response to an interviewer’s question about his firn’s reputation for being “adventurous” in its investments, DFJ venture guy John Fisher makes some very good points about the role of risk inf venture investing: In general, there’s a critical notion...
A venture-guy friend of mine loves A.B.D.s. Translated from a grad school three-letter acronym, “A.B.D.” means “all but dissertation”. It is a higher-ed way of referring to people who have started a Ph.D., completed their coursework, likely done their comprehensive...
A research paper in the journal Technovation makes a point that I’ve been making fairly regularly on this site: Venture capital has changed under the influence of a new generation of industry participants. Competition for ever increasing pools of capital, combined...
The following is a nice chart (courtesy of Focus Ventures) showing the large gaps in performance across quartiles in venture capital. Anyone surprised that most smart investors want to invest in the first quartile of venture funds, or none at...
Brad Feld has a practical and touching piece out on work/life balance. It is well worth reading, especially for those of us who have had an undying focus on work tear apart a relationship (or three), who are always on...
To be completely fair to Kleiner, hands-down the best panel at AlwaysOn, almost worth the price of admission on its own, was Roger McNamee’s on Wednesday about dislocations in the entertainment market. Granted, Roger isn’t really a Kleiner partner — he...
It was apparently KP-day today at AlwaysOn, with KP partners Bill Joy and Ray Lane presenting, plus KP investee Kim Polese (of SpikeSource) on a panel. Perhaps KP overload somehow explains why the chat screen got so nutty during Steve...
I don’t begrudge John Doerr & KP the right to invest in Zazzle, a distant second to CafePress in the custom-product market, but I wish he’d be upfront (in this BusinessWeek interview) about what his strategy is rather than pretending...
While Howard Anderson is admittedly no life sciences venture guy (he says he knows enough to know he doesn’t know much), I still found his comments on the sector in the VCJ interview amusing: But there is something strange about...
In an interview with venture guy Howard Anderson currently running on the Venture Capital Journal website, Dan Primack cites a comment made here. He asks Anderson about why he has left the venture business, having said that the industry has...
George Gilder is onstage here at the AlwaysOn Conference, and he is in fine, mad form. So far he has noisily explained (complete with his uniquely Gilderian “throw me the ball” hand gestures) that WiFi and WiMax are irrelevant rearguard actions...
Tim O’Reilly follows up an email discussion he and I have been having about the architecture of participation and drive-by data by pointing out that real social networks are out there and ready to be modeled — it’s email: When...
For a thorough analysis of venture returns from the MySpace acquisition, look no further than Bill Burnham’s site. The gist: VantagePoint and RedPoint both did well, with the former earning as much as $139mm, or 9x invested capital, in less...
Way back in January of this year I pondered on this site what was up at WinZip. I had spotted a puzzling Dow Jones story alluding to $15mm in secured notes bought by Vector Capital in support of a deal...
Oh my, but the MySpace.com acquisition for more than half-a-billion dollars is going to cause a VC-driven content train wreck. We already had startups falling out of trees making MySpace comparisons, now they’re going to be thick on the ground,...
You had to know this was inevitable, but it’s still interesting watching it happen: Outsourcing is already losing its luster (according to an article in Investment Dealers’ Digest), only to be replaced by, of course, insourcing! Some investors and the companies...
This Fortune magazine retrospective on Netscape and the birth of the web is well worth reading, with interviews from people like Jim Clark, Eric Bina, and others who have been out of sight for a little while....
Shades of 1999, celebrities are back in the venture business. We have Bono at Elevation Partners, and today we have news that Colin Powell has joined venture firm Kleiner Perkins. If nothing else, the Kleiner investment kereitsu’s annual LP parties will...
Most venture firms have mental lists of deals that they shoulda/coulda done, but didn’t, and yet only a vanishingly small number of such firms will ever list the deals that got away. After all, it makes you look intermittently dumb...
Since being so entertained & informed by the use of the IRC backchannel at Etech and Where 2.0, I've been doing more thinking about the state of such low-overhead context-inducing software. As I said to one of the conference organizers...
Bill Burnham's entertainingly shit-disturbing analysis of how Mike Moritz and John Doerr have made out from their firm's respective Google holdings made it into Barron's this weekend. The bottom line, as Bill concedes, as that you can only put a...
Not to rain on a new fund's parade, but to the extent that newly-closed $100-mm fund "RSS Investors" follows a strict investment mandate of chasing RSS opportunities it will be tough. While there are few hard and fast rules in...
While a venture capital guy saying that the venture business is a dud is a little like a grocery store owner warning others against opening their own stores -- it's arguably self-serving -- the quotes from Greylock Partners' Bill Helman...
There is a thought-provoking article in Tennis Magazine about Roger Federer's rise to his current dominant position in professional tennis. While it's a good piece on its tennis merits, many of the points made have much broader applicability, including Federer's...
Netsift, a firm that was a pre-seed awardee of the Center that I run here in San Diego, was purchased yesterday by Cisco. Was about twelve months from company creation to exit, which is far from typical for an early-stage...
William ("Bill") Elfers, founder of venture firm Greylock, has died. He was 87. Having worked for General Georges Doriot at the original venture capital firm, American Research & Development, Elfers went on to create Greylock, an innovative firm that emphasized...
There is a nice factoid buried in this piece on venture capital in the current BusinessWeek. The article is nominally about the supposed excess of venture money out there, but the more interesting aspect is some discussion mid-way down about...
In reading about the venture funding of Sypherlink I'm intrigued by its data-sharing technology. Sounds overly heroic to me, but I like idea of building tools for extracting implict meta-data and sharing across enterprise systems, plus monitoring for key information...
Too many people are investing based on current Brent Crude prices, so clean tech venture investing has become the flavor of the fortnight. In today's NY Times there is a solid Gary Rivlin piece on the current VC ardor for...
I'm fascinated by Viacom's decision to buy Neopets, the wildly popular online synthesis of Pokemon and Sim City. And I'm equally fascinated by how few people are seemingly paying attention. Here we have one of the most successful pieces of...
There is a money quote in a story on The Deal today that adds color to something a large LP guy said to me recently about institutions and their appetite for the venture capital asset class. The piece is about...
Here is a helpful and self-serving rule for anyone pitching a wireless startup and looking for venture money: Don't yammer (overly) about the size of the ringtone market.Depending on the audience, it is either an unnecessary factoid that everyone knows,...
I disagree heartily with Bloglines' founder Mark Fletcher's recent post saying that stealth startups suck. They don't suck, and matter of fact, they are downright rational. Mark argues his case along multiple superficially-compelling dimensions: First mover advantage is important. Fair...
Here is KP venture guy Joe Lacob on why telecom venture investing sucks:This is going to be a decade of opportunities, and I would say that you ought to hire some healthcare partners and spread your risk a little bit....
Yesterday I was skimming through David Kaplan's excellent "Silicon Boys" while looking for good venture capital anecdotes for an upcoming talk, and I was stopped dead by this typically spot-on Scott McNealy comment on John Doerr of KP: McNealy, the...
There is an unintentionally funny paper on venture capital in the current issue of the (oxymoronically-named) journal Entrepreneurship Theory & Practise. The paper, titled, "When do venture capital firms learn from their portfolio companies?", looks at the following:Relying primarily on...
A piece from today's FT on how hedge fund partnerships are not good for strategy could very well have been written about large venture partnerships:The chief executive of Man Group, the world's largest quoted hedge fund manager, said the partnership...
This morning Andrew Willis of the Toronto Globe & Mail touches on something I have mentioned here before: the death of geography in venture capital. He uses a report from Fusion Capital to make the argument in Canada, where it...
I'm surprised if succession planning at venture firm KP is really as coherent as this piece makes it out to be. While I'm impressed that KP partners are at least doing some scenario-style thinking about firm futures, I bet this...
The Financial Times has a Lex column arguing that LPs are set to turn in favor of venture investing and away (a little) from their current ardor for buyout. While I agree, in general, it does gloss some important issues,...
Too many venture investors end up turning wrongly contrarian after looking anecdotally backward and noticing that there is (seemingly) little rhyme nor reason in which portfolio companies end up being successful. They find examples of companies that succeeded despite a...
From an IBF conference speech by Mike Moritz of Sequoia about the vagaries of hiring people (courtesy of BusinessWeek):"We're very bad at being able to predict human performance ... We never thought we'd wind up in business with a CEO...
A sizable part of my talk at the CVCA conference last week was about the elephant in the venture capital living room. There is, I argued, something big and important and dangerous (to some) that almost always goes unsaid in...
David Beisel asks a good question: Where are all the angel investor bloggers? While I've written before about the surprising (at least to me) number of venture bloggers, that number doesn't include angels, of which I can think of, well,...
The following is adapted from a joke recently told at a buyout conference:A successful venture capitalist who has spent most his life making money and living at the ethical edge dies and goes to heaven. He knew it was going...
When I read this fascinating Gary Rivlin piece on the upward angst of so many Valley entrepreneurs, it felt vaguely surreal, like I was reading the treatment for a technology-centric cross between Grease and Saturday Night Fever. Before getting to...
A column by Chad Waite of OVP in the current Venture Capital Journal combined with some post-presentation conversations after my talk at last week's CVCA event got me thinking. And here is my conclusion: I think a lot of venture...
Ray Lane makes some good points about venture investing and the evolution of the enterprise software category in this BusinessWeek interview, but I think the following comment was the most useful one in understanding the venture business itself:Q: You mention...
According to a new study out in the Journal of the American Medical Association, U.S. physicians are evil venture-fund-loving money-grubbers. Okay, the study doesn't say precisely that, but it implies it strongly, mischievously pointing out that remarkably high numbers of...
In yet more "Paul speaking" news, on Friday morning I'm talking at the Canadian Venture Capital Association annual conference in idyllic Quebec City. The subject is the future of venture capital. I will be publicly wrestling Big Questions to the...
Just for interest, I'm speaking at 1pm today at the NCIIA's "Invention to Venture: Life Sciences" conference in Boston. The topic is building teams in early-stage life sciences companies....
Almost every week lately I hear from teams thinking of raising a new venture fund. While that newfound ardor speaks volumes in itself, it is remarkable how people who think themselves adept at figuring out whether a potential portfolio company...
BusinessWeek has an interview/visit with newly-single (in the partnership sense, not the marital one) venture guy Vinod Khosla. He maintains an office at Kleiner Perkins, but is no longer a partner in the current KP fund. While he is actively...
Wouldn't you know it, there is a venture capital twist on the Alberto Vilar story I mentioned earlier today. What was the intended use of the $5-million from a single investor that Vilar allegedly used as his "piggy-bank"?According to the...
Bill Burnham has up a long-promised piece on how the deal-flow model of venture capital is dead. There is, as he correctly argues, too much capital and too much competition in the venture industry for venture firms to sit by...
Okay, let's see if this works. While you can click on the following links and get an audio track of venture capital guy Bill Stensrud's interesting talk and interview with me, it should also work as a podcast. I think....
Dan Primack's PE Week Wire now apparently has 23,000 subscribers. To put it in context, that is roughly three times the numbers of principals/partners at North American venture capital firms. There are apparently an awful lot of venture capital junkies...
Gary Rivlin of the N.Y. Times has inaugurated what is apparently going to be a monthly piece on the venture industry with a fairly savage article. He implies that the U.S. venture industry remains over-staffed, and venture tourists are still...
Today I cheerfully participated for the second year running in the VentureForth Biotechnology Entrepreneur 2005 conference here in San Diego. Once again there was a great turnout of both speakers and attendees, so kudos to the organizers. Here are links...
Chief:"What part did you miss?"Maxwell Smart: "Everything after, 'Now listen carefully...'" -- "Get Smart" (1965-1970)Just had the CEO of an early-stage company relate to me this blackly comedic venture capital anecdote. Young big-ego venture guy swaggers into a room late, tells...
Pundit turned venture guy Stewart Alsop is apparently back. Having left NEA a while back after apparently not learning to be enough of an asshole to be a good VC, Dan Primack of PE Week Wire says Also has launched...
There is a sure-to-be much discussed article in VentureWire today about consumer-centric venture investing. While this is by no means the first piece to point out the newfound focus on consumers in venture capital, and I have discussed the idea...
Move over Bono & Elevation Partners: venture firm Enterprise Partners here in La Jolla has announced its buyout of Muze. The southern California venture firm has purchased Muze, arguably the largest source of meta-data about the entertainment industry. The company...
It is every venture investor's biggest fear: Saying no to the next Google. Leaving aside how distasteful I find that metaphor, insofar as it means being congenitally unable to say Yes to big risks with potentially big returns when the...
There is something of a fin du siecle gloom-fest going on in venture capital this week. Here is venture guy Promod Haque of Norwest in the current BusinessWeek:"Over the next five to ten years, I believe there are going to...
I spoke at length today with a very large (assets, not girth) private equity fund-of-funds manager. Among other things, we talked about the prospects for first-time venture funds and the flight to (perceived) quality among investors in venture funds. Appearances...
Venture folks are fond of saying that they roll up their sleeves and work with portfolio companies. The reality is that, like most people, they'd rather not. As is superficially rational, they'd prefer to have a fully-formed company -- team,...
Here is a quote from a Boston-based venture guy:[LAMP] is a new acronymn that I learned today. It stands for Linux, Apache, MySQL and PHP - all open source components that are eating away at Microsoft's value chain. That is...
While I'm not sure comparing yourself with a broken industry is a great idea, the following is courtesy of Fred Wilson: VCs and Record LabelsRags has a great post comparing and contrasting VCs and record labels....
I continue to see a remarkable number of interesting companies, technologies, and ideas in the messaging/email area. The market reminds me of search, circa 1998: The "smart money" thinks that the market is over, and investors turn up their nose...
attractive nuisance (n.): any inherently hazardous object or condition of property that can be expected to attract children to investigate or play (for example, construction sites and discarded large appliances)No self-respecting startup calls itself "the next Microsoft" any more. Matter...
While entrepreneurs have learned the perils of having more than a couple of venture capitalists on their boards -- too many eunuchs speculating about sex -- venture capitalists themselves are increasingly uneasy with over-large syndicates in their portfolio companies. Among...
Nivi expands nicely on my prior praise of Greasemonkey (in the context of Book Burro) as a venture-category wrecker and says the following:Greasemonkey will blow up business models (as well as your mind) May 8, 2005 First, browsers that don’t...
Dan Primack of PE Week Wire puckishly suggests that Vonage has already lost the title of largest venture capital round of 2005: ... a new insurance brokerage named Imago Ltd. launched today with over $300 million in private equity funding...
Here is a puzzler: Why are there so many venture capital blogs? It is hard not to notice that there a host of such things out there, from Brad Feld's to Fred Wilson's, and everyone inbetween. Here are five possible...
In case folks hadn't noticed, I'm quoted in Matt Richtel's weekend NY Times piece on last week's announcement of a $200-million financing round for VoIP company Vonage. The gist: I put the round in context, pointing out that at its...
What is most aggravating about "what VCs want" talks and articles is how little useful information there is. If people in any other context kept writing the same article, or giving the same speech, over and over again someone would...
From an Information Week article on the resurgence of venture capital activity in Silicon Valley, there is something accidentally appropriate about someone pinning a 1999-style business plan to a restroom wall:Venture capitalist Ann Winblad's office sits on the edge of...
SarbOx email compliance software company Orchestria may be in a boring business, but it's hot stuff, as the closing of its recent $21-million fourth round demonstrated:Though Orchestria positioned the round as a strategic one — seeking only investors with contacts...
From Jon Carroll on Rupert Murdoch:Too many bosses try to be nice guys. A little common courtesy is always appreciated, but what people really want from their bosses is clarity. "Just tell me the truth" is the common cry of...
Great post by Bill Burnham putting the whole discussion of a venture capital bubble in context. I wish I had thought of what he has done sooner, but Bill has finally grounded/normalized the bubble discussion with something meaningful. I won't...
So, now another namebrand partner has gone to super-VC firm Kleiner Perkins. First it was Bill Joy, and now it's Randy "Monk and the Riddle" Komisar. Diagram it: We have peripatetic billionaire John Doer in one corner, gloomy Bill Joy...
Idealab's Bill Gross has wandered for a while in the valley of something-or-another, but one of his companies has scored a material financing round from a marquee VC: USVP has led a $10-million investment in search firm X1. While most...
A while back I called for a unified dashboard where micro-publishers could see their AdSense (and the like) earnings, their Amazon Associates income, and so on. After all, I argued, those people are running businesses, so they deserve the same...
Brent Buckner makes a great point in a comment to an earlier post here. He says, somewhat archly (I think), that, "Willingness to undergo tedium may thus be a competitive advantage for active investors."I agree strongly. One of the things that...
Most of this interview with August Capital venture guy Dave Hornik is less interesting than writer Sarah Lacy thinks it is. For example, she leads with stuff about how ex-lawyer Hornik got his partner position at August ("I talk too...
Here is a press quote from an associate at a well-known venture firm today:"The near term forecast is that the window will continue to remain selective."The subject is IPO prospects for biotech companies, and this fellow is opining on the...
According to NVCA data released yesterday, the proportion of new first-time venture funds among all such funds successfully raising money in the first quarter of 2005 is at a 5-year low. Where 40% of all venture funds doing successful raises...
I gave a seemingly well-received keynote talk this week on the subject of "Entrepreneurs are from Mars, VCs are from Venus" at the Connect Financial Forum. I was being deliberately light, and I was pleased that there was as much...
I'm beta-testing Trumba, Jeremy Jaech's new online calendar thingie. So far I'm not quite sure what to make of it. While I like the interface -- clean, professional, and reasonably self-documenting -- and the functionality is solid -- it's nice...
Richard Florida has out a follow-up book to his widely-read "Rise of the Creative Class". (Recall, that was the book that provocatively pointed out that cities with more gay people tended to more entrepreneurial and creative.) The new book is...
Howard Anderson of YankeeTek Ventures fame, and the founder of Battery Ventures, and the founder of IT market researcher Yankee Group, says venture investing is soooo over:''I don't like it for the next five years," Anderson says. ''I hope I'm...
What are the fastest-growing and fastest-declining business categories in the U.S.? In other words, what types of businesses are being registered in the U.S., and what types of businesses are no longer showing up? InfoUSA has the answers in a...
Former GE CEO Jack Welch is now, among other things, a special partner at private equity firm Clayton, Dubilier, & Rice. As you might imagine, however, news that the no-apologies, no-excuses Welch is going to be doing a look-see on...
Arno Penzias is the only Nobel laureate venture capitalist. He is at NEA, and from this TheDeal.com piece he sounds like he is having a grand time. Interestingly, it took a Sculley sugared-water moment with Steve Jobs to convince him...
Jason Calacanis has posted an entertaining (and a little self-congratulatory) entry concerning his recent sparring with the myriad callow associates from top-tier venture firms who constantly call him. I'm sure it's as bad he says, given that most venture firms...
Venture capitalists, entrepreneurs, and others in the Bay Area might find the following event on April 27 worthwhile:...Reid Dennis and Franklin "Pitch" Johnson review their combined 100 years of venture capital experience and observation, from the major mistakes to the spectacular successes....
IEEE Spectrum has a fun and worth-reading article called "How VCs Thwart Innovation". My view: This is a canard. VCs are in the business of making money for their LPs. Sure, sometimes that is done by creating groundbreaking companies, but...
From an interesting new article in Investment Dealers' Digest:As of March 5, 2005, there has been a 13.4% increase in the number of companies that lost sell-side coverage completely since January 2002, according to Reuters. Some 685 companies lost coverage,...
A VentureOne study summarized in today's San Jose Business Journal shows that CEO/founders are paid less than non-founder CEOs:Executives identified as chief executive officers and founders of U.S. venture-backed companies earn $200,000 in total compensation this year -- some $50,000 less...
In case folks hadn't figured it out already, the company to which I referred in a post a while back was La Jolla-based EVDB. Yes, I know, some people don't like the space and/or what the company is doing, but...
While I find the idea of net-based citizen journalism interesting, I have to confess that now and then the contrarian in me starts getting testy. Too many of the people pushing this meme are card-carrying techno-utopians of the social variant,...
A Sand Hill Road address is coveted among venture capitalists. Firms like being able to say that they are located on said street, just off the 280 in Menlo Park. It has that "we're at the epicenter" kinda sound. And...
For the first time that I have seen in a while a venture fund has closed with less capital than it expected. Leapfrog Ventures has apparently closed its second fund with $102.8-million, well under the $150-million that Venturewire says the...
Great quote from Tom Foremski:"I've figured out how start a business with no money, but keeping it going is the trick."...
For some time now I've been using Caelo's NEO Pro overlay for Outlook email. It has been, in a word, a lifesaver. Here are just some of the things I'm fond of: Integrated search (far better than relying on an...
Interesting that Trumba and EVDB both spoke at PC Forum today. They are different aspects of the same problem, which broadly has to do with syncing & integrating events, whether personal, business, or community (broadly defined). As always, my interest in...
There is a new paper out that tries to puzzle through why some newly-public companies can't survive, even when cash is falling from the sky like ooblek. (It is an academic thingie, so they would never put it quite so succinctly....
Near as I can tell from the Trackback traffic at the Flickr blog, news that Yahoo has bought the company was not just the worst kept secret in recent history: It is also the most buzzed about story in the...
Paul Graham apparently doesn't sleep. He has followed some of his recent musings on the venture industry and entrepreneurship with an idea: How about a summer camp for entrepreneurs? If you apply and are successful, you would move to Cambridge...
Steve Jurvetson has revealed all with respect to partner meetings at venture firm DFJ. The secret? Nerf guns:We seek to take more risk, to fail early and often within emerging industries. We get worried if there is unanimous support for...
Hedge fund manager Jeff Matthews has a typically savvy & practical take on why "Napster to Go", which is lightly touted by Walt Mossberg in today's Wall Street Journal, will fail:Go to a college campus. Ask a random student how...
Paul Graham is back with a typically excellent essay on the many ways that venture capitalists, ahem, suck. It is, of course, funny, wise -- and a blessedly brief 1,511 words. While this is the equivalent of clearing his throat...
Bill Gurley of Benchmark Capital has started a blog (sort of). While it is Gurley's dense and thoughtful writing, complete with the usual wonk-think and requisite throat-clearing, it's really just his periodic "Above the Crowd" email column, albeit in blog format....
The SF Chronicle has an interview with DFJ's Tim Draper. While it is mildly entertaining, there are no real revelations -- other than some comments from Tim on how DFJ managed to miss out on investing in both Yahoo and...
I'm guessing, perhaps wrongly, that there won't be any readers of this blog at the event, but on my way to ETech on Tuesday I'm giving a talk Monday in San Diego at the American Chemical Society annual meeting. The...
The trouble with stealth companies is that they're rarely worth being stealthy about. There are almost always a hundred similar folks doing similar things, so what's one more?Such is affirmedly not the case with a stealth company I visited today....
At the Convergence 2005 conference in San Diego Microsoft's Bill Gates came across in back-handed agreement with those venture folks currently enamored with consumer technologies:Now, we see when it comes to new software things are moving fairly rapidly, a little...
While venture firms may be having trouble finding quality deals into which to put their money, the same is apparently not true for LPs in venture funds. New funds are being financed in droves, with there being more venture funds...
Elevator pitches are vastly overrated. While it is nice to be able to convey the essence of your company in thirty seconds, it is rarely enough to do anything memorable. You're just another guy/gal with scalable standards-based software built on...
Paul Graham is an annoying fellow. Specifically, he has two bad habits: He never writes a bad column.He writes long columns.If Graham wrote the odd bad column I wouldn't feel so obliged to read all of his lengthy, thoughtful, and entertaining entries....
The best part in reading the Seattle P-I's investigative piece into InfoSpace's meltdown five years ago is the emails. Case in point: A series of pleading messages from InfoSpace CEO Naveen Jain to a partner in a venture fund (one...
Interesting stat from a new McKinsey report on global capital markets: Total market capitalization of U.S. equities: $14.3-trillion (2003)Total U.S. venture capital under management: $100-billion (2003)Put another way, U.S. venture capital assets are roughly 0.7% of U.S. equity capitalization, a...
Great post from David Ascher on some of the overlooked things holding up the emergence of Web 3.0. My favorite example? Keyboard shortcuts. Looking to my own behavior the main I reason I don't use as many online apps as...
Analyst Pip Coburn of UBS is quoted extensively in a WSJ piece today on this wood anniversary of the bursting of the technology bubble. I agree with the following comment of his, which should make Pip worried that we're both...
Much of biotechnology investing is predicated on the willing suspension of disbelief. All too often companies have no idea why a particular drug works, or why a treatment is effective. As an investor in these companies you are supposed to...
There is an interesting (albeit disjointed) discussion out there in venture-land over the issue of price in venture investing. It started with a recent comment by John Doerr of Kleiner Perkins who said the following:"If you like the founders and...
Okay, someone needs to explain something to new bloggers. I just received the second email today titled "XXXX blog welcomes you to Bloglet!" (I have X-ed out the actual blog names to be less prickly.) Maybe I should have heard of the Bloglet...
An article in Business Week trumpets the arrival of angel investors in biotech. While there is no denying the numbers -- angel investing in biotech last year was up 10% from 2003 and 52% from 2002 -- I'm not convinced...
I somehow missed this cheerfully strange article from the WSJ back in January. No subscription is required, and this piece, on Philip "Fucked Company" Kaplan's adventures in venture capital via his AdBrite outfit, is fun reading:The $4 million investment by...
Matt Marshall of the San Jose Mercury News (free sub required) argues that VCs are doing the "lemming thing again", albeit this time in consumer-oriented technologies. He points to IM2, Fatlens, Become.com, Adbrite, and others as examples. I don't disagree...
While I'm generally skittish about business plan competitions, they can be an entertaining exercise if the level of competition is high enough. So, with that in mind, here is an excerpt from a note I sent to someone tonight who...
To those folks out there who are so blithely dismissing the entire idea of vertical seach sites, from Kayak to Eliyon, I have a question: How easy do you find it parallel parking your Chevrolet Silverado Crew Cab Z71 in...
I just learned through my Pubsub "ego search" that my site was selected as one of the best business-related (specifically, venture capital) blogs on the net by the folks at Fast Company. Gee, thanks guys! I appreciate the kind words,...
The San Francisco Business Times has named KPCB venture guy John Doerr dealmaker of the year:For his work on Google and past successes, John Doerr has been selected the 2004 Dealmaker of the Year by the San Francisco Business Times....
Back when I was an equity analyst one of the favorite put-downs I would hear from portfolio managers was for them to sniffingly say, "What's to prevent Microsoft from doing that?" It was an all-purpose way for a PM to...
Fascinating working paper out from Harvard's Josh Lerner and others on the heterogeneity in returns among different classes of investors in private equity funds. Here is the executive summary:The returns that institutional investors realize from private equity investments differ dramatically across...
A new (article-body)">breed of first-time (and second-time) venture funds is emerging:Ignition is part of a new breed of venture capitalist ... Rather than investing in a range of business ideas, many of these so-called emerging funds are highly focused, concentrating...
I wouldn't have have thought there was anything new to say about Google, its financing, and its IPO, but there is (as written by the estimable John Heileman):About a month into the [first-round financing stand-off between Sequoia and Kleiner Perkins],...
Some savvy comments on how it is not your parents' VC business any more, from a recent HBS venture capital conference. Persistent asset allocations to the venture category has created a stable fund supply, which means that some funds (and...
Howard Anderson, of Yankee Group and venture firm YankeeTek Ventures fame, has decided not to raise another venture fund. His stated rationale? In his favored area, sofware, there are "no good investments". While that may be true, and it is a...
The AP has out a worthwhile profile out of Ben and Mena Trott, the founders of blogging software provider Six Apart, the maker of Movable Type and TypePad, among other products. While it may not have been the intent, I was...
Some butchered English I heard during a company pitch this week:"We have surveyed where the landscape is blowing."While the resultant metaphor was visually appealing, the mangling of two cliches kicked me for the next few minutes into thinking about Kim...
While it's sort of inside baseball (not everyone realizes that venture funds have vintages, and that 1999 vintages were horrible performers), but this mug is amusing.[Courtesy of Fred Wilson]...
Nice interview in today's FT with Sequoia's Mike Moritz. Among other things, writer Richard Waters perceptively notes (for the first time of which I am aware) that many of Moritz's comments are calculated for effect. Nevertheless, Moritz is a thoughtful...
Good list and discussion here of all the shiny gee-gaws being shown this week at DEMO in Scottsdale....
I was in a meeting recently with some folks from outside the U.S. who wanted to know about San Diego's economic resurgence over the last fifteen years. How, they wondered, had things improved so markedly, from a reliance on defense...
These articles are becoming almost weekly, which implies that either there is another venture capital bubble -- or that journalists are so bubble-fixated that they see them everywhere they look:... the amount of capital out there has led to funds...
Bill Burnham has a nicely empirical post on the fate of software companies who have received dollops of capital as outsized as that gifted on Webroot this week. It ain't good:...after Webroot announced their $108M round of financing, I tried...
According to Venturewire, WaveMarket is in the death throes of closing a $1-$3-million financing round with DFJ. The company has three products: Crunkie, a location-based mobile blogging service; Map.Me, a mobile phone map interface that lets users pan and zoom...
On the impact of the current influx of capital into VC firm coffers:"A lot of stupid ideas will get funded," he said. Yang didn't mention whether his own Redpoint would share in the funding of such companies, but it seems...
The cover of next week's issue of Business Week is nanotechnology. For those of you keeping track of magazines as contrarian signals, that officially means that the current enthusiasm for nanotechnology has peaked. I just thought folks might like to...
Good piece in Business 2.0 on Ram Shriram's angel-investing successes, and his high-profile involvement with troubled social networking sites Friendster and Plaxo:If both companies do crap out, Shriram's reputation will be blemished. But will he be blamed for the high-profile...
No argument: Pricing private equity is tough. After all, there is no market, per se, and prices are only intermittently updated. While it is part-way defensible, it is also worrisome for investors in private equity -- how are they to...
One of the pillars of Internet communications is the ubiquitous WinZip. While the .zip format that it uses is in the public domain (and originally the creation of Phil Katz), WinZip unarguably makes the most popular Windows client-side .zip implementation:...
John Cook has a useful column in today's Seattle P-I summarizing a recent roundtable wherein various VCs discussed their deals' failings. There are some good points about mistiming things, and so on, but most telling (and true) was this crack:"Baseball...
Some of you may have an appetite for deeper analysis of the venture capital industry. If so, a good place to start is Gompers and Lerner's "The Venture Capital Cycle" which recently came out in a second edition. You can...
The complaint docs in the suit by some Epinions founders vs. its venture capital backers is well worth reading. While I think that this is likely to turn into a messy case of caveat emptor, entrepreneurs should still read the...
Business Week's puckish new Deal Flow "blog" on the world of venture investing has a savvy response to the question, "Why invest in biotech?" After all, drug discovery is a brutal business: it's so hard to a drug approved, it...
Somewhat surprisingly, at least to me, there is remarkably little formal research on whether business incubators work. Matter of fact, most research seems to take their effectiveness as a given and then get into the academic taxonomy game of describing...
From a USA Today story about the founder of Picasa:Google executives liked [Picasa] so much, they ended up buying Picasa ... Then [founder Lars] Perkins tried to quit. "I said, 'I have a real problem with bosses, that's why I've...
This will either turn out to be brilliant or stupid. There is no inbetween when a firm like Kleiner Perkins hires a smart, prickly, and contrarian fellow like Bill Joy. You have to hand it to Kleiner though: They know how...
If you're in California, don't forget that this month (tonight if you're in San Diego) you can watch the most recent installment of the von Liebig Forum, a program I host on innovation, venture capital, & technology. It is admittedly...
The arrival of RNAi (RNA interference) has been highly positive for drug development, given the public struggles of competing gene-knockdown alternatives, like first-generation antisense, but its rapid rise (mostly since 2001) has led to a somewhat bizarre situation:Mammalian scientists were...
According to Ann Grimes of the WSJ in a storm in Monday's paper, uber-VC firm Sequoia Capital distributed 27% of its Google shares (now worth >$1-billion) to its LPs back in November and December. While the distribution itself is unsurprising,...
The WSJ has one of its usually excellent technology supplements in Monday's paper. While this edition is not one of the Journal's best -- there is something rote about it, with the obligatory "software sucks" piece, the usual "whither 3G"...
Savvy comments from the OVP newsletter on the current mini venture-financing boom:Some VC firms formed in 1999 or 2000 have a five year limit on investing in new companies. Over the last year, they started to hear the clock ticking,...
Fun piece (in PDF format) by Joel Spolsky about why you may think you need venture capital, but you don't. Yes, he creates something of a straw man that he then beats mercilessly, but it is fun to watch --...
This must have seemed like a dream "book club" discussion at Slate: James "Wisdom of Crowds" Surowiecki vs. Malcolm "Blink" Gladwell. Well, the dream was better than the reality. While the discussion is intermittently interesting, it starts to feel vapid...
There is a brief quote from yours truly in this piece on venture capital bloggers from Venture Capital Journal (and written by the estimable Tom Stein):But how far can VC bloggers really open the kimono? Paul Kedrosky, academic director of...
There is an eye-opening comment buried deep in an article nominally on venture capital in today's Boston Globe. The piece is an otherwise somewhat self-congratulatory one about how well Boston-area security startups did in 2004, mostly via mergers. This snippet,...
Today's WSJ talks up the latest trend in private equity: giantism ...... executives at private-equity funds who once scoffed at the idea of a $10 billion investment fund now say it is only a matter of time. "We would like...
When most people think about venture capital they imagine forty-something (I mean their age, not their number) guys in khakis and blue shirt sitting in some office on Sand Hill Road waiting for bright young things to show up and...
Venture Capital Journal has a cover up-with-VoIP piece in the current issue, complete with somewhat self-deprecating testimony from DFJ's Steve Jurvetson as to the utility of (DFJ investee) Skype. It's about the conferencing, baby:... Jurvetson ... confesses that until recently, he's...
Good discussion over on Brad DeLong's site of Movable Type's culpability in the nasty comment spam problem out there. After all, neglected & spam-ridden MT blogs are analogous to the broadband-connected zombie PCs that issue so much spam and so many...
While my site isn't exclusively devoted to venture capital, I do talk about the industry regularly -- and, darn it all, I say more fun & useful stuff about venture capital in less words than any other seven VCs --...
The National Venture Capital Association has an interesting release out today summarizing thoughts from top-tier U.S. VCs on investment themes and issues in 2005. It's worth reading in its entirety, but here are some quotes appended to the release: On...
The WSJ has a piece this morning that is being passed around madly in venture capital circles. Confirming VCs' worst fears, it argues that there is a boomlet under way in venture capital funding, with too many first-time funds being...
Stuart Watson has come public with his Syndicate IQ syndication-traffic tracking project. From my discussions with Stuart his focus is interesting, in that it is more on commercial content publishers and large-scale providers of RSS/Atom feeds than on individuals. Perhaps...
One of the more entertaining party questions when hanging with VCs is a variant of "boxers or briefs?" It is, IT or biotech? Fans of investing in the former point to IT's long-term returns, the ability to get partial successes,...
Allen Morgan of uber-VC firm Mayfield has an interesting and thoughtful blog. And it's worth noting, at least to folks reading this who have ideas in the RSS/social networking/search spaces, that he has a strong interest in those areas: There...
Shelf at DFJ Originally uploaded by caterina. Caterina of Flickr fame has apparently been on a field trip to DFJ. While there she has stolen a page from one of my favorite things to do when office-interloping: Shelf surf....
Missed this until now. Mamma.com (the firm in which Mark Cuban is a large shareholder) has reached a deal to buy search firm Copernic:Mamma.com Inc., (the "Company"), (NASDAQ: MAMA) and Copernic Technologies Inc. is pleased to announce that the Company...
There is a typically cross, contrarian, and insightful interview with venture capital patriarch Don Valentine over at News.com. In it he argues correctly that nanotechnology is an overhyped technology in search of a problem, but he goes on to make...
Could there be any clearer sign of a rate-driven market top in private equity -- buyouts, LBOs, etc. -- than the Economist's current cover piece? Titled "Capitalism's New Kings", the article is a 14-page paean to the bliss-out wonders of...
Collier Capital has a new report out that it calls a "barometer" of the private equity environment. Among other things, it ranks private equity asset classes in terms of their current attractiveness to investors in private equity:European buyoutsAsian buyoutsAmerican buyoutsAmerican...
Bill Stensrud of Enterprise Partners was in to give a talk yesterday on commercialization of early-stage research. Without diving into everything that he had to say in a provocative discussion, one idea he threw out was that the venture business...
Many people are reading all the wrong messages out of Merck's Vioxx's troubles. It is not merely that Merck ignored the risks in the product; that is a simplistic and overly risk-skewed view. It is deeper than that, and it has...
A paper in the current Journal of Business Venturing asks the perennially popular question of whether venture capital is, you know, worth it. After comparing post-IPO performance of matched venture-backed and non-venture-backed companies the author came to the following nose-tweaking...
Yo Brad, what about us? While Brad Feld writes rapturously about MIT's Deshpande Center in an entry over on his blog, I'm sure he is planning to write something equally nice about the von Liebig Center here at UC San...
I see that various people in the blogosphere are getting a case of blog fatigue. Somewhat like influenza, its symptoms are tiredness and a general feeling of lassitude leading to required rest. While the kind of rest required during influenza...
Another week, another venture capital-centric technology conference. Why are these things so bad? With rare exceptions -- Chris Shipley's spirited and interesting DEMO being one of them -- such conferences are deathly. There are too many venture capitalists delivering a...
Is venture capital antithetical to RSS and weblogs? The ever-gnomic Dave Winer argues so in a (financially) bleak one-liner this weekend: Venture capital conferences about weblogs and RSS are like Republican conferences on the environment.While he isn't explicitly making the...
Stewart Alsop is stepping down from being a partner at venture firm NEA. One of the many folks who jumped into venture capital during the go-go days of the late 1990s, Alsop never sounded like he had entirely escaped his...
The truth about venture capital? Far from being the sunshine-y business of annointing the Next Big Thing and then standing back and cashing the checks as they roll in, for most participants it is a dreary, thankless occupation. Consider: Most VCs...
A thoughtful and interesting post from VC/analyst Bill Burnham. He argues -- correctly -- that enterprise software is being torn apart from the inside, up-ending the binary-centric world in which most of us have grown up, and replacing it with...
In case other folks hadn't noticed, Wired has become worth reading again. Case in point: There is a piece in the October issue that is going to become de rigeur in tech conference, venture capital and startup circles, with the...
Congrats Stewart and Caterina on the new investors. I see that Joi Ito and Esther Dyson have now both disclosed. Good stuff, and some savvy folks....
Crosspoint venture guy Rich Shapero apparently lives by the adage that there is no such thing as bad publicity, so long as you spell his name right. Hence, in other words, his cheerful willingness to sit through a San Francisco...
Joe Krause (of Excite fame) relates an instructive story about Vinod Khosla of Kleiner. Why is this story instructive? Because it shows the difference between a great VC and a merely good VC (and don't even get me started about...
Ann Grimes has a piece in Wednesday's WSJ arguing that there is a new venture capital bubble growing. She points to the return of angels, high net worth sorts, smaller state pension funds, and foreign capital -- dumb money, in...
There is a fun and contrarian piece on Always-On by Bob Sternhill speaking to why venture folks obsess about hiring star CEOs, and why that often leads awry. Fair enough, and too often venture firms do confuse risk reduction with...
Today's San Jose Mercury has a piece saying that the social software funding bubble has moved on to companies like SocialText, Jot, etc. I don't entirely agree with the bubble comment, although I take their point. One difference, and not...
Judys Book, a Seattle-based startup, gets plugged today in John Cook's Seattle Post-Intelligencer column. The pitch is the following: Finding qualified mechanics, dentists, house painters and other tradespeople isn't easy, especially for newcomers to a city. Judys Book will combine social...
Various folks are discussing the same generally silly article in today's NY Times about the recent upswing in venture capital financings. I beg to differ with the optimistically spun piece for a number of reasons, so let's count 'em:It conflates...
Why is there no startup beating the tar out of Microsoft as a small-business replacement for Exchange Server? As most people likely know, Exchange is a fine thing, but it is not the sort of product you lightly install in...
Pete Rojas at Engadget pricks VCs in the opening line of a comment about Guy Kawasaki's decision to include a USB drive with his new book:Venture capitalist (they're still around?) Guy Kawasaki is packaging a SanDisk 128MB USB Flash drive with...
From a story in today's SF Chronicle:A growing number of entrepreneurs, faced with spiraling accounting costs and stiffer corporate governance rules, are choosing to keep their startups private or sell them to a rival rather than take them public. For...
There is an old saying that it takes money to make money. There is some truth to that, of course: A 10% return on a $1-million investment is $100,000; the same return on a $1,000 investment is $100. The latter...
Venture folks are torn on the value of software patents. Some think they are worthwhile, and they point to various business method patents, or even to some of the many patents underlying DVD players. Others think that software patents are...
Pleasurable dinner/chat last night in Vancouver with Dick Hardt of sxip and Stewart Butterfield of Flickr fame. They are up to very different things, of course, but it is remarkable how many of my recent conversations implacably converge on emerging...
Here are some snippets from my current NatPost column. It is on why VoIP provider Vonage really doesn't matter, despite its $208-million in venture backing:Is Vonage the hottest thing in technology, or is it just the second coming of doomed...
DFJ venture guy Steve Jurvetson asks what the coolest thing is that you saw this year: Last year, I think it was at a dinner with Matt Ridley talking about the inter-gene warfare going on within our bodies, especially between...
The most interesting part of Gary Rivlin's NY Times piece today on VCs experience post-Google-partum was the following anecdote about Mike Moritz of Sequoia:Stewart Alsop, a partner at New Enterprise Associates, said, "We wouldn't have done a Google," adding, "we...
From Om Malik, the unsurprising news that another RSS-related company has been funded at an attractive valuation. As far as I know, Sifry's Technorati has zero revs, so this is a $12-million post-money valuation on futures. Congrats to Dave S.EXCLUSIVE:...
People are reading waaaaay too much into the Google repricing. Folks, this was the first time an IPO of any consequence has been priced using a Dutch auction. Google (and the i-banking community) is feeling its way along, so it...
Bill Burnham asks a question I was discussing earlier this week with one of the most successful VCs in North America: Are the best VCs operators (i.e., ex-CEOs) or are the best VCs investors? It is not an idle question. Many...
I have heard this many times from people in the venture industry, but it is still remarkable how many venture folks will concede that they would not likely have invested in Google's series A investment round. Sure, KPCB and Sequoia put...
A new Pew Report says that the number one online activity (after general search) is looking for directions:A full 87% of Internet users look for maps or driving directions online, and they choose the online mode over offline mode in...
Larry and Sergey really have to learn how to dial down the hard sell. The following is from one investor's account of attending the ongoing Google IPO roadshow:"They've violated all 10 Commandments of doing an IPO," said Tom Wyman, a...
The story in today's New York Times about venture capitalist Mike Moritz (of Sequoia Capital) and his tussle with a founder of RedEnvelope puts a fine point on the current debate within the venture community about board seats. The founder...
Today's WSJ has a Kara Swisher piece singing the "wikis change the world" theme. To her credit, she touches on some of the most important issues, like managing collaboration, avoiding edit storms, and deciding who the canonical sources are in...
How much are entrepreneurs willing to pay to get the most prestigious venture capital firms as investors in their firms? According to a paper by David Hsu in the August issue of the Journal of Finance, they are willing to...
Search company Blinkx filed unsurprising notice today that it is out looking for cash. The buzz created by, among other things, Om Malik's recent enthusiasm for the firm has made the desktop tool company speed up its fund-raising plans --...
I'm puzzled why so many people are puzzled about Microsoft buying Lookout Software. Consider: Search is the biggest information management problems people face Email search is among the biggest search problems people face Microsoft's search for its Outlook mail client...
From Techdirt: "In 1999 the entrepreneurs behind a photo hosting company named Webshots sold their company to Excite@Home for $82.5 million. Not bad. Even better, though, was that a few years later, after Excite@Home went bankrupt, the founders bought Webshots...
Good interview here with ex-Microsoft exec (and current VC) Brad Silverberg. His most useful comment was on open source: "I don’t think they have figured [open source] out yet...They are struggling with not so much open source, per se, but...
Tim Draper of Draper Fisher Jurvetson is running his annual gong show for entrepreneurs. Leaving aside the dubious merits of the thing, would-be business impressarios around the world have ten minutes to pitch Draper wild-eyed ideas via an Internet video...
This weekend's Barron's has an article tipping the return of VC-fanzine Red Herring as a sign that venture capital is once again on the rise. Perhaps. But I think the current spending uptick has less to do with improved venture...
Meant to applaud August Capital's David Hornik for this post some time ago, but better late than never. The following precis by David of blogging conferences may just be the most important thing posted in the blogsphere this year: "Welcome...
If I agreed any stronger with this article I would be making dinging sounds. It sounds so simple, but it is so easy to screw up -- and so easy to obtain uber-dividends by doing correctly: "The one constant in...
We all know that efficient markets and random walks mean that past financial performance is no predictor of future results. Or do we? Because while that "rule" holds in mutual funds and public equities, it hasn't held in venture capital...
Vinod Khosla of venture firm KPCB has called Nanosys a "fraud" in a recent presentation (the company has no revenues, and won't have revenues for the foreseeable future). Khosla has also said that the nanotech company shouldn't go public. Some...
Two boom-time VCs have now gone on to real jobs. Steve Harmon, perhaps the quintessential boom boy, is newly at LiveDeal as V.P. of business development. Andrew Anker, ex- of Wired and then a VC at August Capital, is now...
Ex-analyst Bill Burnham has a savvy piece on his blog about the madness of so much money being throw at hot-hot wireless software companies like Good Technology and Visto. The two private outfits have received a combined $160mm in financing....
Tim Draper of venture firm Draper Fisher Jurvetson apparently doesn't have enough work to do. For the second year in a row he is inviting anyone and everyone on the planet to pitch him an idea over at the Always-on...
Here is the sort of up-with-technology quote from the FDA that will overnight make it into the business plans of a thousand platform-oriented life sciences startups:"In FDA's view, the applied sciences needed for medical product development have not kept pace...
Kleiner Perkins' John Doerr is unquestionably one-of-a-kind, an alchemical mix of savvy financial hypester and wide-eyed technology enthusiast. The following quote from him, however, is a self-serving keeper, right up there with his "the Internet is under-hyped" comment from the...
Interesting data from Fenwick & West on recent trends in venture investing rounds in Silicon Valley. As you can see, for the first time in two years the number of "down" rounds has almost been equalled by the number of...
Good Gary Rivlin piece in Wired about the continuing capital overhang in the venture business. Too many VCs went underground in 2000, froze spending, and now that things have thawed a little their capital is all reappearing and messing up...
Kleiner Perkins partner Ray Lane waxes fin-du-siecle on the software industry in this interview with News.com. Along the way, he has the following comment about India's unheralded evil twin at offshoring -- Canada:"If you look at our portfolio companies, out...
Is too much money still screwing up the venture capital business? There is no doubt that things were out of control in the late 1990s, with everyone and their Pomeranian opening a venture firm. But how about now?Well, some think...
Interesting piece here profiling some thoughtful recent comments by Sequoia Capital partner Michael Moritz. While Moritz engages in a bit of revisionism about his firm's investments in Cisco and Yahoo -- neither was originally as hang-dog as he self-servingly portrays...
According to the current Advertising Age, things were busy, if nervous, at this week's National Association of Television Program Executives (NATPE -- pronounced to (sort of) rhyme with "nasty") conference in Las Vegas. TV execs can't figure out where the...
My National Post column today was on bumpf and posturing at the World Economic Forum annual meeting in Davos.Update: Ah, if only I had seen this story before I had written the above column. Apparently the WEF anticipated my criticisms...
Microsoft's quarterly financial results tonight seemingly have many investors in a tizzy. It has nothing to do with the higher-than-expected equity compensation costs, however. Those are shuffling of costs from one period to another, and it isn't all that important...
Quirky piece in the Independent about Oracle CEO Larry Ellison's recent marriage to romance novelist Melanie Craft. It is requisitely snide in that U.K. way, so you get bon mots like the following: "At 34, Ms Craft is 25 years...
Venture capitalists love to say that if you're only coming to them for money then you're coming to the wrong place. Their point: a good VC, you know, Kleiner Perkins, or Sequoia -- or, of course, ahem, the firm you're...
Venture capital is rapidly becoming a derelict industry. News this week that a partner in a major Boston fund recently moved out to play "house" in South Carolina. And more news today that the first quarter of the year followed...
After much tussling with venture funds and (mostly) the media, CalPERS finally released performance data for its venture capital investments. Here is that data in a more useful form: Year Funds Average St dev 1993 5 19% 3.6% 1994 18...
I've been thinking a fair amount lately about venture capital syndication. For those not in the know, that is the method by which venture capitalists "share the wealth" by letting other venture capitalists in on deals. For example, I might...
