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Venture Capital This Week for November 29

Published: 11/29/2012 9:55:21 AM, comments: 0

It's always an interesting week in venture capital. Discover the best stories, blog posts and other information inside the VC ecosystem in the US and in hotspots around the world. Onward dear reader…



RENEWABLE ENERGY VC LOOKING UP

The future is "green" for venture capitalists in the renewable energy sector, according to a report from Frost & Sullivan.


Frost & Sullivan
: Renewable Energy Venture Capital


STARTUP IDEAS

Paul Graham of Y Combinator has an excellent essay up on how to get the best startup ideas.


Paul Graham
: Want Startup Ideas, Look for Problems


CELEBRITIES AND STARTUPS

Internet VC Mark Suster has published a “pros and cons” post on whether startups should seek out celebrity endorsements.


Both Sides of the Table
: Some Advice for Celebrities and Startups


CONSUMER INTERNET CHANGES

Successful Internet VC Fred Wilson gives his thoughts on the changing nature of venture capital funding of consumer Web companies.


A VC
: What Has Changed


CONSUMER INTERNET - WHAT HASN'T CHANGED

Outspoken micro VC Dave McClure says in response to Fred Wilson's post "What Has Changed" is that VCs who shy away from consumer in favor of enterprise will miss out on a huge opportunity.


500 Hats
: The Internet Keeps Getting Bigger


CYBER MONDAY VC PORTFOLIO DEALS

First Round Capital touted its network of portfolio companies working together. VC industry observer Sarah Lacey sheds light on the history of the concept:


PandoDaily
: The New Keiretsu


Q3 VENTURE FINANCING REPORT

Law firm Cooley LLP has its 3rd quarter, 2012 venture capital financing report out and concludes that deal volumes are slowing and early-stage valuations are declining.


Cooley
: Venture Financing Summary for Q3 2012


ENTREPRENEUR WHINING

Internet VC Jeff Bussgang says that entrepreneurs should realize that fundraising is part and parcel of building a successful business.


VentureBeat
: Quit Your Whining about Fundraising


VCS INVESTING IN CLEAN TECH

At a recent panel at the Going Green event hosted by AlwaysOn in San Francisco, veteran VCs gave their thoughts on clean tech investing.


Greentech Media
: Going Green Panel


THE SERIES A CRUNCH

Series A rounds are becoming few and far between for consumer Internet companies, or so says Sarah Lacy at PandoDaily. But Connie Loizos over at PE Hub says that isn't news.


PandoDaily
: The Series A Crunch is Hitting Now

PE Hub: The Series A Shortfall Isn't News

Post Election - The Economic Way Forward

Published: 11/27/2012 9:05:22 AM, comments: 0





The Milken Institute in Santa Monica conducted a snap poll of its senior colleagues for their opinion on what the most pressing post-election issues are for the administration and Congress:

Looking Forward

The fiscal cliff ranked highest in the opinions of the biggest issues facing the country, followed by how to jumpstart job creating demand while at the same time beginning to reign-in unsustainable budget deficits. 

Managing this feat is going to be increasingly difficult in an environment where the Euro zone is in recession and Asia is experiencing lower than trend growth rates.

Paradoxically, taking steps to correct the truly immense budget deficits will increase confidence even as it withdraws government money from the economy.

This in turn may encourage businesses, which are currently sitting on nearly $2 trillion in cash, to begin investing at a more normal pace, resulting in a more sustainable growth environment for the country and world economy.

Don Jones
VentureDeal

Venture Capital Resource Guide for Fall 2012

Published: 11/20/2012 9:48:58 AM, comments: 0


    -- National venture capital database VentureDeal is pleased to announce the availability of its free Venture Capital Resource Guide.

Recently updated, the guide provides readers with access to a wide range of resources covering the venture capital ecosystem in the United States.



From databases to blogs, social networks, pitch conferences and nascent crowdfunding resources, the guide is a tremendous resource for entrepreneurs, professionals, investors and service firms looking for a one-stop location for information about the venture capital industry.

VentureDeal is a national venture capital database that provides the latest information about venture capital, venture backed technology companies, venture capital firms and transactions in the United States.

DonJones
VentureDeal

Venture Capital This Week for November 9 - 15

Published: 11/15/2012 9:14:53 AM, comments: 0

It's always an interesting week in venture capital. Discover the best stories, blog posts and other information inside the VC ecosystem in the US and in hotspots around the world. Onward dear reader…


FRED WILSON ON CROWD FUNDING

Prominent Internet VC Fred Wilson was interviewed recently on a variety of topics, one of which included crowdfunding.

Xconomy: Fred Wilson Interview

On the topic of crowdfunding , Wilson sees it as a boon to early stage investors, but only if it “doesn't get crushed by regulatory rules.”


VENTURE CAPITAL MONEYBALL

Using data to inform venture capital investment decisions is nothing new.

VentureBeat: Venture Capital Picks up New Strategy

The article on VentureBeat says there is a "revolution" going on in venture capital, but I don't buy the revolution talk. More like evolution. Otherwise a good piece.


STARTUP PLANNING FOR AN EXIT

Internet VC Mark Suster made a presentation earlier this week on how best to plan for a profitable exit of your startup company.

Both Sides of the Table: Exits for Technology Startups

He makes several points and includes an early copy of his actual presentation. One takeaway is to "build relationships early" with potential buyers.


WHAT STARTUPS NEED

There’s a good piece/interview of early-stage startup guru Naval Ravikant on ReadWrite.

ReadWrite: What Do Startups Need Most Right Now?

Ravikant surveyed his users and found the top three things they needed were: Talent, Funding & Advisors.


SHARK TANK BREAKDOWN

Lightspeed Venture Partners VC Jeremy Liew likes to analyze the pitches on the television show for entrepreneurs, Shark Tank.

Jeremy Liew: Season 4 Week 9 Breakdown

This particular show featured a couple of entrepreneurs who ultimately had not thought through their business plans very well, and the sharks passed on the investment opportunity.


TRIDENT CAPITAL INVESTMENT

It’s not often that you see an in-depth explanation of a venture capital firm's areas of investment interest.

Enterprise Irregulars: Trident Capital Areas of Interest

The firm sees a decrease in funding to consumer Internet companies but a significant increase in enterprise models.


VC SHAKEOUT

Much has been written about the ongoing shakeout in the venture capital industry and Lee Hower of NextView Ventures in Boston has more to write on the subject.

PandoDaily: Are We There yet?

Hower believes that we are in the "middle innings" of the weeding out process and that it has years more to go ahead.


CHANGES IN ENTERPRISE

Peter Levine of Andreessen Horowitz says that there is a renaissance happening in the enterprise.

TechCrunch: Enterprise Renaissance Going On

Levine says that changes underway in enterprise are a function of the shift from the personal computer to a mobile environment.


QUEBEC VENTURE CAPITAL UP

Canada has shown uneven venture capital investment results over the past several years, but Québec had a stable third quarter.

PE Hub: Reseau Capital Report

The region saw a slight 2% decline in Q3 2012 from Q

Uncommon Knowledge for Startups - Part 2

Published: 11/13/2012 9:20:33 AM, comments: 0

There is plenty of advice to go around for starting your technology company, but this series aims to provide uncommon (or irreverent) information and approaches to successfully starting up. This is part 2 of a series, part 1 was here.

1. It's About the People. Money is more available than ever – from angel investors, incubators, crowdfunding sources and of course venture capital. Entrepreneurs seem to obsess more over money than attracting great people to help their business grow.  Success hinges to a greater degree on the quality of the people you can attract as employees, consultants and advisors. Find the right people, the money will come.

2. Traction Is like Honey. If there is one phrase that is a favorite phrase of investors is: “We have significant traction.” Of course, the right kind of traction is important. Ideally, you want to have a rapidly growing user base who is engaged with your service or product. Being able to demonstrate that growth is coupled with engagement is critical to getting high-quality investors excited about your opportunity.

3. Integrity Is Important. Investment communities tend to be rather small groups composed of people who trade information and talk with each other frequently. It's important to deal with potential investors in an honest and forthright way. Cutting corners on ethics can make you the subject of conversations that will reduce the number of opportunities for you to obtain financing.

4. Crisp, Clear & Confident. One area that I see entrepreneurs not taking seriously enough is in practicing their pitch presentation. Being able to quickly and succinctly explain your ideas and buttress them with supporting information if questioned can make the difference between financing success and failure. Many investors will only provide you with one chance to make a positive impression. Practice makes the difference.

Don Jones
VentureDeal

Venture Capital This Week for November 2 - 8

Published: 11/8/2012 9:06:34 AM, comments: 0

It's always an interesting week in venture capital. Discover the best stories, blog posts and other information inside the VC ecosystem in the US and in hotspots around the world. Onward dear reader…


BAY AREA VCs CONFIDENCE UP SLIGHTLY

The Q3 2012 Silicon Valley Venture Capitalist Confidence Index report results are now out.

PE Hub: Confidence up Slightly, Worries Remain

The index rose from 3.47 to 3.53 in the second quarter, based on surveys of venture capitalists located in Silicon Valley. Worries about high valuations continued.


HISTORY IS NOT PROLOGUE

Outspoken VC Fred Destin says that the story of the last few years in venture capital investment returns is not set in stone.

Fred Destin: On Historical Returns

He asserts that “no amount of historical market data analysis is going to tell you which fund to invest in next."


CAPITAL REQUIREMENTS

Lower capital requirements for startups has been the trend in certain industries over the past few years. That may be changing:

Continuations: The Return of the Capital Intensive Startup

New York City VC Albert Wenger is seeing the signs of startups spending larger amounts of money to gain market share and leadership.


KILLING YOUR STARTUP ECOSYSTEM

Startup Communities founder and VC Brad Feld has a post on what not to do in your community.

ReadWrite: Six Common Problems

Among the killers: Your city’s startup infrastructure is ruled by "old white guys", and not welcoming entrepreneurs when they show up in town.


2013 CAPITAL MARKETS REPORT

The 2013 Pepperdine Private Capital Markets Project has produced its annual report on the private cost of capital and related benchmarks.

Pepperdine University: 2013 Capital Markets Report (PDF)

A key takeaway is that "a large share of private capital lenders and business owners report that domestic economic uncertainty is the biggest issue facing private businesses."


CHRIS SACCA INTERVIEW

Outspoken early-stage Internet VC Chris Sacca gave an almost three-hour interview on a wide range of technology startup venture capital issues.

PandoDaily: PandoMonthly Interview with Chris SaccaInterestingly, he decries the sense of entitlement that he believes now exists in the Internet/digital media startup culture.


STAY OUT OF LEGAL TROUBLE

Think your startup can’t be snared in legal problems?

VentureBeat: Four Ways to Keep Your Startup Out Of Legal Trouble

While some of the points are good common sense, a top mistake is “signing agreements without fully understanding the consequences of key clauses”.


PITCHBOOK VC OVERVIEW

Venture capital and private equity database company Pitchbook has its quarterly Venture Capital Rundown out.

Pitchbook: 4Q 2012 – Venture Capital Rundown

Among the findings, VC investment across all stages dropped dramatically in Q3 from Q2, although year-to-date volumes in 2012 match that of 2011.


HOLLYWOOD AND VENTURE CAPITAL DON'T MIX

Los Angeles-based VC Mark Suster says the future of the Internet is all about video.

Both Sides of the Table: Why Silicon Valley and Hollywood Don't Get Each Other

He says he has been "pounding the table" for the last three years about the future of the Internet and this post explains why.

Uncommon Knowledge for Startups - Part 1

Published: 11/6/2012 9:12:28 AM, comments: 0




While there is plenty of advice to go around for starting your technology company, this series aims to provide uncommon (sometimes irreverent) information and approaches to successfully starting up.

1. Assume Your Service Sucks

I got this from an old (1985) marketing tips book and it encapsulates a great frame of mind that each startup entrepreneur should have. The point is not to fall in love with your own product or service. It's fine to have confidence in what you've accomplished or built, but great entrepreneurs know that their job is never finished and this is especially true in technology, which is always marching forward. Each day, ask yourself "what part of my service (or product) sucks the most?"

2. Quickly Discover Your Failures

A startup is based on a set of assumptions, many of which turn out to be incorrect. You should always be on the lookout for those assumptions or basic beliefs about your service or the market that you operate in that are faulty even if they were once true. You can't make the right decisions about your startup if you are basing them on bad or outdated assumptions. Not facing up to your wrong judgments or decisions can swiftly doom your startup.

3. Patents NO, Freedom to Operate YES

Entrepreneurs frequently ask if they should pursue patent protection for their technology. With the rare exception, my advice is to not waste time or money on securing a patent, since patents are really just a "license to sue" and the technology world changes so quickly anyway. Also, you will likely never have enough money - $3 million to $5 million per lawsuit - to enforce your patent. It is far more important to have "freedom to operate", which is simply knowing that you're not stepping on anyone else's technology toes. Industry giants like IBM or Microsoft do have the money to enforce their patents, so you would be well advised to stay clear.

4. Money for Milestones

How much financing should you seek? The answer I generally give is that it depends on what milestones you want to reach with that money. A sophisticated investor generally thinks in terms of milestones, i.e. what the company has a good chance of accomplishing with a given amount of financing. Milestones can be completion of a beta trial, the acquisition of a certain number of initial/marquee customers and the identification of senior hires upon receiving the next round of funding.

Stay tuned for the next installment of "Uncommon Knowledge For Startups".

Don Jones
VentureDeal

Venture Capital This Week for Oct 26 - Nov 1

Published: 11/1/2012 10:08:10 AM, comments: 0



It's always an interesting week in venture capital. Discover the best stories, blog posts and other information inside the VC ecosystem in the US and in hotspots around the world. Onward dear reader…

VC HOME RUNS ARE IMPORTANT

Much has been made of the frequently stated goal of achieving "home runs" in the exits of VC portfolio companies.

The Equity Kicker: Why Home Runs Are Key

Based on the data from one of the world's largest limited partner investors in venture capital, Internet VC Nick Brisbourne says that venture capital firms generated “60%+ of their returns from just 10% of their capital, which was invested in companies that achieve home run exits of 5x or more.”


I DON'T KNOW WHAT I'M DOING

Successful Internet VC Bijan Sabet has a heartfelt post up on the consequences of fear and of not sharing those fears:

Bijan Sabet: Real. Honest. Fear

The comment section below the post also has good entrepreneur insights into the effects of uncommunicated fear among entrepreneurs.


EUROPEAN VC DOWNTURN

VentureWire has the numbers out for third quarter 2012 dealmaking in technology venture capital throughout Europe, and they aren't pretty.

Venture Capital Dispatch: European Venture Investment and Exits Fall

Q3 saw a 22% decline in the number of deals and an 11% decline in total investment, compared to the same period in 2011. M&A was also down 39%.


VCs AND BLOGS

A new study is out purporting to show the effect of the blogosphere on venture financing decisions.

Utah Policy: New Study on Blogs and Venture Capital

Among the findings, the report says that VCs are more influenced by a relatively few number of top technology blogs than large numbers of less popular blogs.


DEPRESSION AND ENTREPRENEURS

Successful Internet VC Brad Feld has a heartfelt post up on his blog about a subject that doesn't get discussed very often.

FeldThoughts: Depression and Entrepreneurs

He details his own struggles with depression and acknowledges that entrepreneurs frequently have to deal with a "wide range of stresses and emotions that often have overwhelming intensity".


DOWNSIDES OF BEING A VC

This conversation thread on Quora has been around for a while, but it is illustrative of the issues that VCs face in their own work.

Quora: The Worst Part of Being a VC

Entrepreneurs can benefit from this info because it sheds light on the internal considerations that VCs face when investing.


CORPORATE VENTURE CAPITAL STAYING POWER?

The up and down nature of corporate (strategic) venture capital investing is well documented.

Boston Consulting Group: Corporate VC Is Here to Stay

The report says that the pressure to innovate is fueling the surge in corporate venture capital interest in startup companies.


THE BEST VC PITCH

VC Greg Gottesman has heard more than 7,500 pitches in his career.

StarkRavingVC: The Best VC Pitch Ever (Humor)

He says that the "Ice Cream Glove” was the best one he's ever seen…

Don Jones
CEO, VentureDeal

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