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Every founder and startup investor should be contrarian

The Equity Kicker

In the world of startups and venture capital all the money is concentrated in a small number of winners and average returns are probably below zero.

How to Do Research on VCs (Written by a VC)

View from Seed

For example, occasionally entrepreneurs will ask things like, “How much capital have you called from your current fund?”

The Loneliness of Success that Nobody Talks About

Both Sides of the Table

But I wanted to call out specific attention to the loneliness of success because it has its own unique flavor. It was a heavy day, for sure.

Why Was Winter in Venture Capital Funding so Short?

Both Sides of the Table

billion in venture capital funds with one A-round fund and one late-stage fund. Why Was Winter in Venture Capital Funding so Short?

Good Listeners

David Lee

Warren Hogarth from Sequoia Capital called him the “most persistent founder he ever met.” “Entrepreneurs are often given two pieces of contradictory advice: persistence and flexibility. Have a vision and pursue it through years of people telling you you’re out of your mind. There isn’t an actual algorithm. Endnote ].

Keep the Good News Flowing - Pass the JOBS Act, Now

Seeing Both Sides

Both of these are very important mechansims to encourage more capital to flow into young, innovative companies.

IPO 4

VC Governance FAQ: (10) Are limited partner defaults on capital commitments triggering a wave of lawsuits in the venture industry?

Pascal's View

This is the last in our series of 10 frequently asked questions from investors in venture capital partnerships. Why throw more money their way?

LP 1

How VCs Make Money….Hopefully

ithacaVC

First, VCs get capital commitments from limited partners (i.e., That means that it has capital commitments from investors of $100mm. Capital is called when needed for investment, fund expenses or management fee. And, VC1 does not reinvest capital returned (with very few limited exceptions) – VCs are not hedge funds!

The Venture Capital Shakeout

Andrew Payne

The venture capital business is in the middle of a shakeout. LPs missing capital calls (a very big deal). I don’t wish ill-will on any of my venture friends, but I think this is good for everyone in the long run: we’re flushing out a broken, over-capitalized, me-too industry.

IRR 0

In The Long Run, We Are All Dead

Seeing Both Sides

GigaOm reports that Sequoia Capital called an all-hands, emergency meeting with its portfolio CEOs to walk through a recommended plan of action. Cut costs, cut projects, raise incremental capital, be proactive and plan for the worst. That said, CEOs need to take swift action to make sure they survive to see the long run.

A Time for Change in Venture Capital

K9 Ventures

The bottomline is that this is the worst time in history for the venture capital industry. Here are just a couple that I’ve come across recently: TechCrunch: The End of Venture Capital As We Know It? WSJ: Venture Capital Hits a Cash-Call Crunch. BusinessWeek: What Will the Crisis Mean for Venture Capital?

Playing the Volume Investing Game - DShen's Blogs

Dshen

Typically capital calls are made to limited partners when an investment happens. If there are a lot of capital calls, making and collecting a huge volume of capital calls can be a lot of work on the fund personnel and limited partners. Capital calls may work differently for these early stage funds.

VC Governance FAQ: (8) How can a limited partner exit from a VC fund?

Pascal's View

This is the eighth in our series of ten frequently asked questions from investors in venture capital partnerships. Answer: The options here are limited, and they are (1) the LP can try to sell their interest, including the obligation to fund future capital calls, to a fund that acquires secondary interests.

LP 0

The Expanding Birthrate Of Web Startups

A VC : Venture Capital and Technology

I like to think of the venture capital business like parenting. That care and feeding includes the decision to call it quits and give up on the project sometimes, but honestly that doesn't happen that much in our portfolios. I see the capital calls. The venture capital business is contracting.

What is going to happen?

Venture Cyclist

Some VCs will have trouble when they make capital calls (asking their investors to send the next tranche of the investment money that they are contractually bound to send). Those commitments are drawn down in the form of the capital calls I mention above.) does it effect the VC world? It is well worth reading.

Death By VC

Venture Chronicles

Throughout my years in the venture capital business I was witness to some questionable behaviors and tactics, which in reality is par for the course in any business, but nothing could have prepared me for what I have seen in the last 2 years. The second scenario is the pulled term sheet. It’s the nuclear scenario.

Q3 2012 VC Fundraising Data and Conclusions

ithacaVC

But I did come across a super post today by Michael Greeley at Flybridge who reported on the just announced Q3 2012 VC fundraising data released by the National Venture Capital Association (NVCA) and Thomson Reuters. Nine of the top ten funds are in California; #10 (Pharos Capital) calls Dallas and Nashville home. -

The Collapse of the VC Ecosystem & What It Will Look Like Post.

Altgate

But the folks in the middle don’t really do anything other than fire founding CEOs and add capital. But some will be saved. So what to do?

ILPA 2.0 - Evolution, not revolution

Recent Buzzes - VC Experts, Inc.

One area where some GPs will feel that ILPA is being too prescriptive is in the standard form capital call and distribution notice - the first of five templates that ILPA intends to create. By SJ Berwin LLP. January 21, 2011. Introduction. Last week, after extensive consultation, ILPA published a second version of its Principles.

ProfessorVC: The Most Important Venture Capital Statistic

Professor VC

The Most Important Venture Capital Statistic. million for the year, which is the first time it has been below $5 million since 2001, a sign that capital efficiency will be even more important than it has. Some were also dealing with issues of limited partners struggles with capital calls and asset allocations. We drew $1.5

Why Co-Founders Are a Startup's Biggest Liability | The Startup Lawyer

thestartuplawyer.com

Contact The Startup Lawyer: Home Page About Contact FAQs Glossary Ryan Roberts Law: Home Page Social Networks: Facebook Twitter LinkedIn Flickr Delicious Digg Last.FM He obviously never launched a startup and got shafted by a co-founder. Entrepreneurs often believe their startup company faces legal threats from only external sources.