VC Nuggets of the Day

• Technology Monitor by The Economist
• Guy Kawasaki on Venture Capital
• Viable vs. fundable business
• VC is a “Hot or Not” dating games (you have about 15 seconds to make an impression)
• You need to present a clean deal (e.g. using typical law firm, not hiring your relatives)
• PowerPoint is a standard (10 slides, 20 minutes, 30 points font): (1) Title slide with contact information; (2) Problem slide; (3) Solution slide; (4) Business model – how you make money; (5) Underlying “magic” (e.g. technology, people skills, access to unique info); (6) How to you access the market; (7) Competition slide (honestly show gaps); (8) Team slide; (9) Projections (the most important part is a metrics not the dollar amount); (10) Status and timeline (where are you now)
• “Drill a lot of holes” – you will need to make a lot of effort to raise capital.
• “if the dogs are eating the food” = “We need more money to scale” = very attractive opportunity
• www.churchillclub.org – The Churchill Club is Silicon Valley’s premier business and technology forum. The 6,000-member, nonprofit organization has built a reputation for dynamic, in-the-news programs featuring Silicon Valley CEOs, up-and-coming executives and national business leaders.

 

VC Nuggets of the day

• Venture Capital section of Deal Book of The New York Times edited by Andrew Ross Sorkin
• Developers worldwide can integrate LinkedIn into their business applications and Web sites. Read more…
• www.startuphire.com was created in March 2009 as a place for VCs and startups to list their job openings.
• www.defragcon.com – Defrag is focused on the tools and technologies that accelerate the "aha" moment, and is a gathering place for the growing community of implementers, users, and thinkers that are building the next wave of software innovation.
• Harvard Business School (HBS) says that it will hold a new business plan competition open to HBS alumni from all over the world. Read more…
• “investors should be prepared for lower-than-average historical returns with heightened government regulation, lower consumption, slower growth and a shrinking global role for the U.S. economy” Read more…
• The formation of a new company to run the online newsstand — sometimes characterized as an “iTunes for magazines” — may be announced in early December. Read more…
• Venrock = Venture + Rockefeller; A pionering venture capital firm formed in 1969.
• David Pakman – a Partner at Venrock in New York, David focuses on early stage venture investing in internet and digital media companies. Read more…
• Cloudera, the commercial Hadoop(TM) company, today announced that it has secured a Series B venture capital funding round led by Greylock Partners. Read more…

VC Nuggets of the day

• The Institutional Limited Partners Association (ILPA) is a not-for-profit association committed to serving limited partner investors in the global private equity industry. Members of the ILPA manage more than US $1 trillion of private equity capital.
• Tim O’Reilly is the founder and CEO of O’Reilly Media, Inc., thought by many to be the best computer book publisher in the world.
• Delta Cloud API by Red Hat’s Emerging Technology group – an API that abstracts the differences between clouds
• http://en.wikipedia.org/wiki/Bill_Gurley
• ZDNet: Tech News, Blogs and White Papers for IT Professionals
• John Borthwick CEO of Betaworks – business acceleration platform – collection of 22 loosely coupled entities (e.g. TweatDeck) .
• Web 2.0 Expo NY 09: John Borthwick and Sarah Milstein, "A Conversation about the Realtime Web"
• Web 2.0 Expo NY 09: Danah Boyd, "Streams of Content, Limited Attention (a rough unedited crib of the actual talk)
• Building Enterprise Mashups – Web 2.0 conference – a presentation by Michael Ogrinz, author of Mashup Patters
• AltAssets – Global Private Equity News & Research
• SG Partners and Glocap – head-hunters specializing in PE industry.
• Silicon Alley 100 (complete list)

VC Nuggets of the day

• VC Funding Season (according to Mark Suster who is focusing on early-stage technology companies) – “It is very difficult to raising venture capital between November 15 – January 7th.  It is also very hard to raise VC from July 15 – September 7th. … The VC process is almost universal in how it works across firms.  You meet an initial person from a firm – an associate, a principal or a partner.  If it’s one of the first two you’ll probably meet a single partner before coming into a full partner meeting where (by definition) all of the partners will be in attendance.” Read more…
• “Fund raising is an ongoing process and not an event on a workplan.  You need to build a relationship with investors over a long period of time.  That is how you convince VC’s that you’re gaining “traction.” … If you wait until you’re “ready” to fund you’re too late.  Funding is about developing a relationship over time…If you wait until you’re “ready” to fund you’re too late.  Funding is about developing a relationship over time.” Read more…
• An outline for the posts on how to raise money from VC by Mark Suster.
• Hacker News on YCombinator. YCombinator is a new kind of venture firm specializing in funding early stage startups.
• MASSACHUSETTS INNOVATION & TECHNOLOGY EXCHANGE

VC Nuggets of the day

• Fred Wilson is a managing partner at Union Square Ventures – specializing in early stage investing. 
• CloudMade is building tools that will make it easier for non-technical people to add data to OpenStreetMap. Google owns its mapping data, even when that data is provided by volunteers, while data contributed to OpenStreetMap is owned by whoever provides it. Read more…
• Norwest Venture Partners (NVP) – Norwest Venture Partners raised $1.2 billion and will invest the money in technology startups and other growth-stage private companies based in the U.S., India, Israel and China over the next three to four years, says managing partner Promod Haque. Read more…
• Industry analyst Gartner Group recently predicted that the market for cloud computing services will exceed $14 billion by 2014.
• www.joyent.com – this company positions itself as on demand computing. Nevertheless, it looks like it changes fees before you actually consume the resources. Is it really a cloud?  Validated Technology Stacks: Unparalleled Apache, PHP, Rails, and MySQL performance in the Joyent Cloud.
• AlwaysOn – VC & $ – The 2009 Venture Capital 100 – The 2009 Winners – AlwaysOn VC 100 highlights the one hundred individuals who have backed the most profitable winners in the last four years (copy of the list).
• BusinessWire \ Services \ Finance \ Venture Capital
• What is a definition of top-tier venture capital firm?
• Forbes will not publish its annual Midas List next year. Read more…
• Bootstrapping is the art of building a business via one’s own financial means. Read more…

VC Nuggets of the day

• Sean Parker’s Rise of Facebook And Twitter, Fall Of Google Presentation (Full Slide Deck) – he argues that so-called “network services” like Facebook (which he helped start) and Twitter will soon dominate the web, rather than “information services” like Google and Yahoo.
• 25 Internet Startups That Bombed Miserably
• www.microsoft.com/BizSpark – A program that provides Software, Support and Visibility for Software Startups.
• Start Up Directory on Microsoft Startup Zone

VC and Angel Nuggets of the day

• The New England Venture Summit, presented by youngStartup Ventures, is the premier industry gathering connecting senior executives of early stage and emerging growth companies, venture capitalists, angel investors, technology transfer professionals, university researchers, incubators, successful entrepreneurs and premier service providers.
• 12th Annual MIT Venture Capital Conference – The MIT Venture Capital Conference addresses the most important current issues in the venture capital industry.  For 12 years, the conference has attracted leading investors and entrepreneurs to participate in discussions at the core of venture investing and company building. Webcasts of the 2008 MIT Venture Capital Conference are available on the website.
• www.outright.com – “Outright is free, simple bookkeeping and will remain so. We do plan to charge a nominal fee for innovative services yet to come.”
• www.evernote.com – cloud-based service that helps you to remember everything.
• Fenwick & West’s Silicon Valley venture capital survey finds that up rounds exceeded down rounds last quarter for the first time this year — 41% of rounds were up, 36% down and 23% flat. Read more…
• 10 Largest VC-Backed M&A Exits of 2009
• www.businessinsider.com/alleyinsider – Silicon Alley Insider (SAI)

VC Nuggets of the day

• www.Pomeroy.com – “3000 corporations, government entities, and mid-market clients rely on Pomeroy IT Solutions every day” – was acquired by Platinum Equity for approximately $65 million. That approximately translates into $21.5K per customer.
• www.MobileMD.com – Health Information Exchange (HIE).
• www.CreditKarma.com – “…the latest credit score-focused funding recipient, San Francisco-based , announced that it raised $2.5 million in a Series A investment round to build up its advertising-supported business.” Read more…
• Negotiating a Better Series A Deal by Sim Simeonov (on Twitter)
• definition around the types of Series A
• Not much has been raised previously—at most a few hundred thousands and ideally nothing.
• The product has not been (fully) built.
• The size of the round is at least $3M but preferably larger.
• You are talking to professional VCs with funds > $100M.
• a company that needs several million dollars today to build a business is not worth much at all without the dollars
• the value of your company is going to be reverse-engineered from the cap table
• two things to notice about this process
• First, at no point did it require justifying the value of the startup.
• Second, the margin for negotiation is somewhat limited as (a) the option pool size should be budget-driven and (b) most investors, rightly or wrongly, are pretty set on the percentage ownership they require.
• if you really want to get your VCs to take a lower percentage, you’ll have to work a lot harder to generate interest from multiple firms
• Some investors, typically VCs with larger funds, won’t care much about giving you an extra few hundred thousand or even more than a million if you have good reasons for asking for it.

Angel nuggets of the day

• Keiretsu Forum is the largest of these new angel networks, with more than 500 angels in 11 chapters on three continents.
• “A recent article in the Economist quoted the Center for Venture Research which estimates that there are 350,000 angels investing $30 billion in 50,000 ventures each year in just the US. Worldwide the numbers are much larger but are hard to estimate.” Read more…
• “Angels … expect to hold on to their investments for five to seven years…”
• David Rose, the chairman of the New York Angels: “the cost of starting an Internet company has dropped tenfold. Years ago, it cost about $2 million to get a strong concept to product launch. Shortly after the burst of the Internet bubble, the cost got down to a couple hundred thousand. Recent angel-funded companies have gotten there on $20k. And now, the cost is heading lower. … they get to invest in companies that already have a finished product when they seek funding. So, the money is  for scaling, not for developing a prototype.”

VC & Angel Nuggets of the day

• Seedcamp was designed to be a way of bringing together the different strands of the ecosystem together – entrepreneurs, investors, advisors, academia and corporates.
• TechCrunch was founded on June 11, 2005, as a weblog dedicated to obsessively profiling and reviewing new Internet products and companies. TechCrunch has now grown into a network of technology focused sites offering a wide range of content and new media.
• There has never been a better time to polish your CV, shine your shoes and start a new hedge fund. Read more…
• “VCs think they can handle 4.6 boards for early stage companies and 5.4 boards for later stage companies” Read more…
• “If you join an accredited angel network, which pools expertise and resources, you could pay $2,500 to $5,000 in annual fees. An angel fund may charge management fees of 1% to 2%.” Read more…