A Smart Bear: Startups and Marketing for Geeks

OCTOBER 23, 2012

” Here’s the summary of his track record (excerpted from the Fast Company article): Forefront — IPO’ed in 1995 by CBT — CBT stock fell 85% in 1998 and prompted class-action lawsuits. Except I disagree with that definition of “success.” Support.com — On 2.5m

IPO 240

IPO Flash Bootstrapping Private Equity 240

Cracking the Code

DECEMBER 9, 2006

Paris, November 1998. Detailed SaaS Spreadsheet (Valuation and CAC benchmark). SaaS 13 Index Valuation. Thoughts from a Venture Capitalist on Software, Software-as-a-Service (SaaS), Cloud Computing, Internet and more. Saturday, December 09, 2006. First week on the job. S&M productivity (CAC ratio) for the SaaS 13 Index.

Software Review 48

Software Review Technical Review Europe Venture Capital 48

Ben's Blog

JULY 16, 2013

You probably thought that valuations would be roughly the same as they were the last time you raised money. 3/31/1998: 30.8. And those are big companies with real earnings, so you can imagine how a private company’s valuation might fluctuate. In June of 2000, I raised money at an $820M post-money valuation.

Down Round 78

Down Round Marketing Preferred Stock Post-Money Valuation 78

Gust

OCTOBER 17, 2012

It is not highly concentrated geographically, or in the bubble of 1998-2000, or in any industry. The data on valuations, activity levels, geographic and industry distribution is quite interesting, and over time, this will provide a quarterly gauge on angel investment returns, as well. The distribution of returns from the different U.S.

Angel Investor 152

Angel Investor Venture Capital Seed Stage Silicon Valley 152

Both Sides of the Table

MAY 23, 2012

Yes, it’s true that FOMO (fear of missing out) is driving some irrational behavior and valuations amongst uber competitive deals and well-financed VCs. In 1998 there were around 850 VC funds and by 2000 there were 2,300. In 1998 it was 150 million, 1999 250 million and by 2000 it had crossed 350 million. The Funding Problem.

Venture Capital 347

Venture Capital Technical Review LP Mobile 347

Ben's Blog

MARCH 24, 2011

As we do so, keep in mind that the relevant bubble statistic is not valuation. High valuations are fine if the underlying value is there. In the great bubble of 1998-2000, the boom in public valuations mirrored the boom in private valuations. If too much venture capital hits the streets, valuations will bubble up.

Technical Review 78

Technical Review Venture Capital Valuation Database 78

Diego Basch

JULY 1, 2014

In a previous post I mentioned an interview I had at Netscape in 1998. One manager talked about how they were a bit bummed because Yahoo had just surpassed their market valuation. Some ask questions everyone should ask, such as the financial situation of the company. During lunch came another red flag.

Silicon Valley 73

Silicon Valley Coder Vesting Open Source 73

Growthink Blog

DECEMBER 15, 2011

Sure, your revenues and profits will factor into your valuation, but what about things like: The quality of your team: do you have well trained employees that expertly perform? Like self-made billionaire Meg Whitman, who ran eBay from 1998 to 2007. And that's why it's critical to determine how YOUR company might be valued.

Entrepreneur 96

Entrepreneur Salary Stock Revenue 96

Berkonomics

SEPTEMBER 17, 2011

The year was 1998. Within three months, we easily obtained $3 million of investment at a pre-money valuation of $30 million. Three months later, another investor company in the business offered to invest $3 million at a valuation of $60 million. million at a valuation of $80 million. Of course we took all of these.

Liquidity Event 59

Liquidity Event Pre-Money Valuation Sales Valuation 59

Seeing Both Sides

JULY 21, 2014

In 1998, Yom Kippur fell on September 30th. million in one year, the year we went public at a billion dollar valuation (ok, it was 1996; everyone went public in 1996 with a billion dollar valuation), and then $61 million the following year. This allowed our revenue to skyrocket from $1.8 million to $22.5

Revenue 54

Revenue Valuation Churn Rate Portfolio 54

Ben's Blog

JULY 16, 2013

You probably thought that valuations would be roughly the same as they were the last time you raised money. 3/31/1998: 30.8 And those are big companies with real earnings, so you can imagine how a private company’s valuation might fluctuate. In June of 2000, I raised money at an $820M post-money valuation.

Marketing 46

Marketing Preferred Stock Post-Money Valuation Down Round 46

techcrunch.com

OCTOBER 13, 2012

It is not highly concentrated geographically, or in the bubble of 1998-2000, or in any industry. The data on valuations, activity levels, geographic and industry distribution is quite interesting, and over time, this will provide a quarterly gauge on angel investment returns, as well. The distribution of returns from the different U.S.

Angel Investor 103

Angel Investor Venture Capital Seed Stage Silicon Valley 103

Sophia Perl of Wisdom

OCTOBER 16, 2011

For $3-5M company valuations, they usually own 1-2% of the company and when there is liquidity (e.g., Conway’s first fund, Angel Investors I, raised and invested in 1998, generated a 7 times return. They invest an average of $50K-$200K. IPO, aquisition), they typically own 0.5% of the company. times return.

Silicon Valley 53

Silicon Valley Angel Investor Portfolio IPO 53

Reid Hoffman

JULY 27, 2021

The Harvard Business School’s business plan competition has been running since 1998; the only competition winner that has achieved any sustained success is Cloudflare (2009). Or maybe valuation depends on growth rates or operating margins. Of course, these valuation measures are based on historical market data.

Silicon Valley 69

Silicon Valley Venture Capital Balance Sheet Cofounder 69

Reid Hoffman

JULY 27, 2021

The Harvard Business School’s business plan competition has been running since 1998; the only competition winner that has achieved any sustained success is Cloudflare (2009). Or maybe valuation depends on growth rates or operating margins. Of course, these valuation measures are based on historical market data.

Silicon Valley 69

Silicon Valley Venture Capital Balance Sheet Cofounder 69

Feld Thoughts

FEBRUARY 28, 2023

The boom years of 1998 (79 IPOs), 1999 (175 IPOs), and 2000 (142 IPOs) are long gone. Since the attractiveness of investments is also largely related to exit channels, this aspect affects the availability of capital and company valuation at every stage. While there was a major law reform in 2021, the regulations are still inadequate.

Germany 165

Germany Liquidation Preference Option Pool Advisory Board 165

finance.fortune.cnn.com

AUGUST 21, 2012

FORTUNE -- Its no secret that venture capitalists were hit hard by last decades dotcom bust, considering that median returns for 1998-2001 vintage funds are all underwater. Exclusive: Returns for brand-name VC funds By Dan Primack August 20, 2012: 12:15 PM ET. Beyond the dotcom-era benchmarks. Spectrum Equity Investors IV (2000): 133% (127%).

Naming 49

Naming Term Sheet Private Equity Equity 49

Seeing Both Sides

MARCH 2, 2011

When foursquare took $20 million in venture capital at a reported valuation of $100 million, suddently they had transformed the company from a lean, product-obsessed start-up to a company that would need to generate tens if not hundreds of millions of dollars in cash flow to justify a billion dollar valuation. The verdict?

API 44

API Valuation Lean Burn Rate 44

BeyondVC

DECEMBER 20, 2004

Companies pre-1998 that went public received on average about $20mm of venture funding, were 6 years old, were EBITDA postive, and had a pre-IPO value of around $170mm (includes companies such as Peoplesoft, Intuit, Mercury, Documentum, Checkpoint, and Veritas). using pre-bubble data and this is what we found.

IPO 60

IPO SEC Valuation Revenue 60

Ben's Blog

OCTOBER 29, 2020

What you see from the above is that median floats were pretty consistent from 1980-1998, but dropped significantly during the dot-com bubble. Even assuming they wanted to raise the same amount of nominal dollars at the IPO as in the past, higher valuations means they can do so by issuing many fewer shares.

IPO 36

IPO Securities and Exchange Commission Demand SEC 36

aweissman.com

DECEMBER 18, 2006

While I don't pretend to be smart enough to begin to analyze such an esoteric question, having been involved in technology venture capital since 1998, I will make a few, lightweight, observations: -At one, fundamentally important, level venture capitalists (VCs) are buyers of stock.

Valuation 20

Valuation Stock Venture Capital Equity 20

Seeing Both Sides

AUGUST 3, 2012

Incorporated in 1998 in Cambridge, Massachusetts, the company’s network of over 100,000 globally distributed servers provides an infrastructure layer that accelerates the distribution and delivery of content, media and applications. The first one I’ll focus on is Akamai. Akamai: The Present.

Distribution 49

Distribution Lean Massachusetts Cofounder 49

crowdSPRING Blog

FEBRUARY 16, 2011

“The median net return to VC fund investors has not been positive for any vintage year since 1998″ – [link]. Seed Stage Valuation Guide – [link]. Remarkable valuation for Zynga – but their profits might actually justify it – [link]. million for Storenvy – [link]. – [link].

Social Media 95

Social Media Small Business Design Media 95

David Teten

MARCH 24, 2014

We over-weighted small cap value stocks in 1998-2002. However, it was the right thing to do from a valuation perspective. Our value in the past has come from big tactical asset allocation bets. It was a nutty thing to do at the time. And it helped our returns.

Software Review 114

Software Review Due Diligence Venture Capital Portfolio 114

www.paulgraham.com

OCTOBER 23, 2010

The investors backed down; wedid another round of funding at a reasonable valuation; the giantcompany finally gave us a piece of paper saying they didnt own oursoftware; and six months later we were bought by Yahoo for muchmore than the earlier acquirer had agreed to pay. Back in 1998 our CFOtried to talk me into it.

Startup 105

Startup Cofounder Software Stock 105

Seeing Both Sides

MAY 26, 2009

billion, as the company has successfully “grown into its valuation” and become the leading in the content delivery market). Terry’s ascension to chair of the NVCA comes at an interesting time, to say the least.    Yet the impact is enormous, with 18% of GDP provided by venture-backed companies. 

Private Equity 20

Private Equity Boston Massachusetts IPO 20

Both Sides of the Table

DECEMBER 5, 2010

MySpace would liked to have owned YouTube but didn’t have the public stock valuation to purchase them at the price that Google did. In 1998 the Department of Justice launched an anti-trust case against Microsoft. Google acquired YouTube for $1.65 billion, which at the time seemed laughably high and now seems prescient.

Social Network 318

Social Network Networking Internet Technical Review 318

David Teten

NOVEMBER 15, 2013

Each new investor tends to raise valuations and lower returns for all the other competitive investors. Simon Lack reports in The Hedge Fund Mirage that from 1998 to 2010, hedge fund managers earned $379 billion in fees, while their investors earned only $70 billion in investing gains. Would you pay a $379 tip for a $70 meal?

Management 114

Management Pre-Money Valuation Venture Capital New Hampshire 114

www.paulgraham.com

APRIL 28, 2010

When we sold our startup in 1998 I thought one day Id do some angelinvesting. 2 ] When you negotiate terms with a startup, there are two numbers youcare about: how much money youre putting in, and the valuation ofthe company. The valuation determines how much stock you get. Valuations dont vary as much.

Angel Investor 63

Angel Investor Syndicate Syndication Dilution 63

Cracking the Code

SEPTEMBER 2, 2008

He should have invested in Lawson obviously… I could not track back their stock price in 1998 when NetSuite was launched, but since Jan. Detailed SaaS Spreadsheet (Valuation and CAC benchmark). SaaS 13 Index Valuation. 2002, the stock price went from $17.5 per share to $8.0 My Investments. CornerstoneOnDemand. anecdotes.

Software Review 48

Software Review Software Technical Review Cloud 48

Professor VC

JUNE 6, 2016

(girl scout song believed to be adapted from poem written by Joseph Parry (1841-1903) or perhaps Boardwalk Empire if you believe Reddit ) In the picture above, "Make New Friends" was sung by the entire Barron Park Elementary School on its first day as a neighborhood school in 1998. A fitting song for a new school year and new school.

Syndicate 28

Syndicate Syndication Cap Table Ratchet 28

Ben's Blog

MAY 24, 2021

1990-1998 13.3% Time Period % Below IFR % Within IFR % Above IFR 1980-1989 30% 52% 13% 1990-1998 27% 49% 24% 1999-2000 18% 38% 44% 2001-2019 33% 45% 22% [ source ] When we combine the data from the two charts, we can discern some conclusions. 22% 1990-1998 13.3% 1990-1998 10% 6.3% Time Period IPO Pop* 1980-1989 6.1%

SEC 36

SEC Accredited Investor IPO Technical Review 36

ReadWriteStart

OCTOBER 22, 2019

It even penciled for Google in 1998, and it still worked well enough that Facebook chose to establish its headquarters in Palo Alto, California, in 2004. And they just announced a new round of funding; $300 million from Salesforce Ventures, pegging the company’s post-funding valuation at over three-billion dollars.

Distribution 117

Distribution San Francisco Silicon Valley El Salvador 117

Up and Running

DECEMBER 9, 2014

Bates: Josh, it reminds me of when I was doing web sites back in the day in 2000 and 1998 and instead of going and being able to buy a shopping cart you had to code the shopping cart from scratch. Bates: You know Josh—. Joshua Reeves: You don’t have to wear those twenty hats any longer.

Small Business 95

Small Business Finance Forecast Metrics 95

Both Sides of the Table

SEPTEMBER 17, 2017

I believe the massive valuation increases in cryptocurrencies we’ve witnessed of late are not based on any fundamentals other than speculation and a drive for a quick profit by many who have gained from the market hype. Why would pouring hundreds of millions into even earlier stage startups with even less or no oversight be a good idea?

Government 280

Government Distribution Stock United States 280