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In the first post in this three part series I described why I believe the VC market froze between September 2008 – April 2009. I obviously don’t have a crystal ball so the economy could fare better than my gut, but here’s why I’m cautious for some time in 2010 or early 2011: Why is the future still so unpredictable?
One year ago I predicted that in 2010/11 the economy, far from being on the path of permanent recovery was on a temporary resurgence and there was a strong possibility of a “double dip” recession. So I agreed to offer my current thinking on the economy and what it portends for the VC industry & fund raising for entrepreneurs.
6PM: Job Hunting for Software Product Managers in 2010. We are pleased to have a member of our group and former product manager turned VC, Charlie O'Donnell speak to us about the challenges of job-hunting in the current market. RSVP: [link]. 7PM NY Tech Meetup: FinTech and more! Back to demos. RSVP: [link]. Wednesday, March 3rd.
How long does it take from first meeting a VC to getting cash in the bank? I went back across the 21 investments I''ve made both at First Round and at Brooklyn Bridge Ventures --a period that dates back to January 28, 2010, when I closed on Backupify. That''s an interesting question.
Greycroft is an early-stage VC. Closing a VC fund in 2009/10 is a major achievement in and of itself. In the intro section of the show we talked a lot about why VC funds are becoming smaller again and where Greycroft fits. Moving into online education courses for 8 th -12 th grade in Summer 2010. Competitors: Knewton.
The truth is that I’ve been warning about convertible notes since 2010 it was first declared that “convertible notes have won.” ” Today I want to talk about how a VC thinks about equity pricing on your round and particularly if you’re coming off of a convertible note. It’s very simple.
I’m writing this series because if you better understand how VC firms work you can better target which firms make sense for you to speak with. It in not uncommon to see a VC talk about “total assets under management&# as in “We have $1.5 What is a VC fund? VC’s don’t invest 100% of their own money.
To see the video of This Week in VC click on this link. We spent the first 45 minutes or so talking about industry trends (in this order): The history and background of True Ventures, one of my favorite early-stage VC’s (and the one with whom Om is a venture partner). first vertical to launch by 2010 Holiday Season.
If you want to understand the software trend that drove the creation of the seed-stage VC phenomenon I wrote about it that linked blog post but in short: cloud computing drove down the cost to create startups enabling a new category of investor. Some quick highlights include: The Role of a Seed Stage VC. Startup Lessons'
They do around 7% of the total VC-backed deals in the US per year or just under 40 deals / year on average (present year excluded!). Where I add commentary from myself or my fellow VC colleagues from our discussion after Jamie left I’ll put in red. Nearly 50% say they will increase their activity levels in 2010 (hallelujah!)
It’s always fun chatting with Jason because he’s knowledgeable about the market, quick on topics and pushes me to talk more about VC / entrepreneur issues. The following was available: “I kept hearing about startups that raised VC funding, but which hadn’t filed Form Ds (nor issued a press release).
Spark Capital is relatively new to VC (founded in 2005) yet has become one of the hottest new VCs having invested in Twitter, Tumblr, AdMeld, Boxee, KickApps and many more companies. Topics we discussed in the first 45 minutes of the video include: What is VC like in NY? Our guest was Mo Koyfman of Spark Capital. Other Deals.
But I guess you could say the same about VC. Stock market declines would bring back dog days of VC. If you want a comprehensive summary of the industry in this era it’s worth a read: VC Ice Age Part 1 – What Happens When a Market Comes to a Standstill? VC Ice Age Part 2 – Why the Market Started Moving Again?
This is where VC comes in and why it’s needed in the industry no matter how much populist sentiment exists against the VC industry. I know that in late 2010 it’s not as popular to say this because we’re in the era of “super angels&# and feel-good startups. It’s hard to say.
There has been this narrative about investing in VC funds that you have to get into the top quartile (25%) or possibly the top decile (10%) in order to generate good returns. I have heard that for as long as I have been in VC and probably have written it here a few times. As you can see, investing in VC funds can be very profitable.
It was especially fun for me because we got the chance to talk about the VC industry and how entrepreneurs should think about the VC industry in addition to discussing deals. Segment Three: “VC Deals Funded this Week”. 14mm in Series C; $25mm in Series B raised in March 2010; $44mm raised in total. LivingSocial.
I met him in April of 2010--almost two years before he got a venture round. Actually, I wouldn't even really call them passes, because in a couple instances, they were just conversations--"Pre Deck" if you will. Devrim Yasar just raised an additional $7.25 million for Koding.com. He wasn't even working on this fulltime.
This was really a fun week at TWiVC because we decided to have an entrepreneur come and talk about raising capital rather than having a VC come on. In particular I tried to do most of the “entrepreneur advice on VC” up front so that if you don’t want to watch our views on the deals you don’t have to. OTHER DEALS: 1.
I can’t help feel a bit of rear-view mirror analysis in all of “VC model is broken” bears in our industry. To really assess what opportunities the VC industry has over the next decade, one needs to first look at some of the root causes of poor returns in the past decade. The number of venture capital funds has shrunk by two-thirds.
In 2010 somebody posed the question on Quora, “Is Mark Suster a Successful Venture Capitalist?” Helping companies get to next financing round successfully: I was just beginning this phase in Sept 2010 and said so. This is what I wrote on that Quora answer from Sept 2010. Lemons ripen early, great companies take time.”
And that was evident on today’s Angel vs. VC panel. The VC industry is segmenting – I have spoken about this many times before. The VC industry has different segments in it that have different fund sizes, different investment amounts and different risk / return expectations. It’s just not a VC investment.
Having spent time around and then in the world of VC in the Bay Area during the last decade, I’ve been reflecting on how different norms in the industry have changed. At the start of 2010, there was some unwritten VC industry conventions that have been tested, challenged, and upended in the last decade.
The biggest question I think VC''s face right now is whether or not, in the future, the best founders will look and act like the best founders of the past. My own track record as a VC across First Round Capital and Brooklyn Bridge Ventures actually starts in January of 2010, *after* the Airbnb class of Winter 2009.
Over the past month a colleague ( Chang Xu ) and I sifted through data on the venture capital industry (as we do every year) and made a bunch of calls to VCs and LPs to confirm our hypotheses. Between 1999–2005 the costs went down by 90% and between 2005–2010 they went down a further 90%.
So I saw this tweet by Semil Shah yesterday: A friend who works in an industry far from tech startups & VC asked what would be the single article I’d share to read on each topic. So I clicked on the link to my Competing To Win Deals post, which I wrote in 2010, and read it. That is a failure of the system.
Our first Opportunity Fund, raised two years later in 2010, has generated only 3.9x That explains why our 2010 Opportunity Fund has a lower cash on cash return but a much higher IRR than our 2008 early-stage fund. Our 2014 Opportunity Fund has a higher cash on cash return but a lower IRR than our 2010 Opportunity Fund.
We haven’t hit that wall yet for three reasons: 1) not enough elapsed time, 2) the VC market is frenzied now, too and 3) we haven’t seen a market downturn since the volume picked up. But I’ll judge the angel class of 2009/2010 on a 7-10 year time horizon. I was very active in 2009 / early 2010.
In 2010, I funded his company, Backupify , which has gone on to raise over $19 million in funding and is set to have their best year of revenue to date. The best spend of sponsorship money I''ve ever seen might be the $50 in balls and chalk that Dennis probably spent building the Foursquare court that beat Gowalla in 2010.
Will you get the TechCrunch bump, the tier-1 VC anointment, followed by great PR firm support and then the NY Times or WSJ story that follows? So as I get around the country speaking at college campus in 2010 & 2011 I have been preaching the same theme. Not every problem has to be a huge VC-fundable business.
I’m often asked about the differences between being at a VC and being an entrepreneur and whether I prefer one or the other. But as LA as a tech community grew massively the percentage of our LA deals went from 15% to 50% from 1996 to 2010 and it has remained solid since then.
I don’t believe that search is the only answer in 2010 as it was in 2000. I found this investment strange since normally VC’s hate to bet on gaming companies. In my mind, not a typical VC investment. In the interview we also covered: - How are VC funds structured: closed-funds vs. evergreen funds? OTHER STUFF.
When Chantel asked investors for $3mm for her seed round back in 2010, people stood up and took notice. So if you're a super early stage with just a prototype, you might not think that a VC fund is the right fit for you--so you wind up at an angel group. VCs don't go later and angels don't go earlier. Venture investing is hard.
This was the first episode where Jason wasn’t on the show, which gave me the chance to have another VC on the show to discuss deals. Rustic Canyon is an LA-based, but geography-agnostic VC that is currently investing from a $200 million fund. VC Financings: 1. I keep meaning to get him drunk to spill the stories.
This is where VC comes in and why it’s needed in the industry no matter how much populist sentiment exists agains the industry. I know that in late 2010 it’s not as popular to say this because we’re in the era of “super angels&# and feel good startups. got picked up early without raising a lot of VC.
Now that he’s become a VC he’s promising me he’ll provide way more public information and discourse so please welcome him by following him on Twitter and better yet welcoming him with a Tweet of your own linking to his Twitter handle or this post. And he followed through. So he had had a taste of it.
Yet the truth is that I see angels with great deal flow & great instincts whom I believe will only perform well in times that favor angel investors (like 2010) where there are early exits. Tags: Startup Advice Tech Market Analysis VC Industry. I don’t believe these times will last. Part three will be published shortly.
Applications are due April 6th, 2010, the form is on the website and the Twitter address is @launchpadlad. When I kicked off Launchpad LA a year ago I had a few objectives: Create an ecosystem where all Southern California VC’s had the chance to work together more actively outside of the boards on which we mutually sit.
This led Roy Rodenstein (whose company Going.com was sold to AOL ) and others to discuss , what happens when VC’s need to invest across multiple funds. And VC’s don’t like to invest across multiple funds. A totally new VC is willing to invest in the company but at a $15 million pre-money valuation.
In 2010, Antonio Garcia Martinez, the founder of AdGrok, wrote, “New York will always be a tech backwater, I don’t care what Chris Dixon or Ron Conway or Paul Graham say.” In 2005, it was a risky bet to join Union Square Ventures and plant my VC career here in NYC. They’re less impactful on a year to year basis.
In part because as a VC I reached the longevity where you see some things fail and have to ask yourself, “would I readily work with that person again? I saw this in 2001-2003 and in 2008-2010. But I’ve been thinking a lot about failure in the past year or so. Why or why not?”
It all started in 2010 with Klout. From this debate about Klout John and I have had a series of in person meetings and debates about our industry (both VC & tech) and what is changing. 2:00 Why don’t you like the term VC? 7:00 80% of the VC funds last year went to a small handful of funds. SHOW NOTES.
We held a 90-minute demo session where 150 of LA’s VC’s and senior technology executives watched the LPLA V2 group present in small groups of 12-15 each. The VC’s & executives were then asked to make “commitments&# (in writing) to 3-5 of the companies that they felt they could make some sort of contribution to.
I recently read a blog post by Beezer Clarkson, Managing Director of Sapphire Ventures about why entrepreneurs should care about from whom their VC funds raise their capital. There are a lot of things I think entrepreneurs should care about when raising from a VC: How big or small their fund is? Beezer did.
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