Feld Thoughts

FEBRUARY 9, 2016

One of my favorite lines in buried in the middle: “I’ve heard enough companies say “we simply can’t cut costs or it will hurt the long-term potential of the business” to get a wry smile. Pragmatic cost cuts are always possible and often productive.” I learned this lesson 127 times between 2000 and 2005.

Cap Table 70

Cap Table Down Round Liquidation Preference Founder 70

Both Sides of the Table

JULY 29, 2010

The A round was done in February 2000 (end of the bull market) and my B round was done in April 2001 (bear market). As a result I had to do a down round. Down rounds are psychologically really difficult on companies and can make it harder to do later rounds. I eventually needed more money.

Venture Capital 282

Venture Capital Term Sheet Valuation Stock Options 282

Both Sides of the Table

JUNE 22, 2011

I know that most people who are close to them tend to deny their existence, as we saw in the great housing bubble of 2002-2007 and the dot com bubble of 1997-2000. New investors hate down rounds. I believe a bubble occurs when a market is willing to pay greater than intrinsic value for an asset class. That’s a fact.

Saudi Arabia 309

Saudi Arabia Valuation IPO Technical Review 309

David Teten

AUGUST 7, 2019

“You could argue that when they were [raising] oversubscribed [VC rounds], Facebook, Google, Amazon, etc., The reverse also holds: a Value investment can become Momentum, and then follow with a down round. In 2000, LPs invested $104b into 638 funds, but by 2003, LPs’ commitment rate had dropped to just $11b into 161 funds.

Venture Capital 60

Venture Capital Valuation Stock NDA 60

Both Sides of the Table

FEBRUARY 14, 2016

I’d like to explain as best I can my opinion on what is going on because most of what I hear from entrepreneurs is not only wrong but is reminiscent of what I heard in 1997-2000. Why Down Rounds are Harder Than You May Think. Down rounds are hard. Plus, down rounds trigger anti-dilution provisions.

Valuation 150

Valuation Down Round Startup Later Stage 150

Altgate

MARCH 8, 2009

Later stage funds will end up owning more of their portfolio companies via down rounds and ultimately should see ok returns. The later stage guys may see a pickup about the same time as the Series A guys but I suspect it will take longer (like the recovery after the 2000 crash).

Later Stage 34

Later Stage Early Stage Venture Capital Portfolio 34

Scalable Startup

FEBRUARY 1, 2013

And that’s been reflected in the entrepreneurial community, where entrepreneurs, especially between 2000 and 2008, entrepreneurs really only wanted to do — for the most part wanted to do consumer software, because that’s the only software that they could actually get anybody to adopt. Marc Andreessen: No, we have not seen down rounds yet.

Software Review 22

Software Review Startup Venture Capital Stock 22