A Venture Capital History Perspective From Jack Tankersley

Feld Thoughts

In January, Jerry Neumann wrote a long and detailed analysis of his view of the VC industry in the 1980’s titled Heat Death: Venture Capital in the 1980’s. The key reason for the explosion in capital flowing into the industry, and therefore the large increase in practitioners, had nothing to do with 1970’s performance, early stage investing, or technology. Take a look at the founding syndicates of each: Masstor Sytems (5/1979). Quantum Corporation (6/1980).

On Human Capital & Venture Capital

thebarefootvc

It is the human capital involved, both internally with company teams and externally with advisors, boards and investors, that is going to differentiate which startups survive and become the disruptive businesses of tomorrow.

Trending Sources

The Singularity hits Venture Capital (Wilson/Kauffman Redux)

Fred Destin

I mean, really, who still wants to be a venture capitalist ? And then we have Fred Wilson telling us that should venture capital die, there's always be blogging. I an now expecting Chris Dixon to say he is turning to Venture Capital , and then I will be officially confused. The schizophreny of the venture capitalist. Venture partnerships need to collectively find winners and drive as much cash at reasonable valuations as they can into these stars.

Is @AngelList Syndicates Really Such a Big Deal?

Both Sides of the Table

If you track the venture capital industry it would be hard to miss the conversation going on this week over AngelList “Syndicates.” Bowery Capital). Is AngelList Syndicates really such a big deal? For starters, what is AngelList Syndicates?

When VCs Invest Together, Does Ability or Affinity Matter?

Feld Thoughts

The first article, In Venture Capital, Birds of a Feather Lose Money Together , was a summary that let to the second article, The Cost of Friendship , which led to the actual article behind the annoying SSRN paywall. Venture Capital gompers hbs syndicate VC

IPO 50

Able Lands $6 Million in Venture Capital and Expands Nationwide

SiliconHills

Able, a non-bank commercial lender, Tuesday announced it has closed on $6 million in venture capital and plans to expand its services nationwide. Blumberg Capital and RPM Ventures led the round with participation from Peterson Partners and Expansion Ventures AngelList Syndicate.

The Silliness Of Recapping Seed Rounds

Feld Thoughts

If I was leading a gang of friends (that’s what I called it before the word syndicate started to be used), and that gang had put in $200k alongside my $25k, I’d encourage my gang to do the same, and they often did. In this case, we misread the respect – or lack thereof – that a co-investor and an entrepreneur would have for the other seed investors and the seed capital that helped them get a product built and into customer hands. Here’s the scenario.

Doing The Heavy Lifting

A VC : Venture Capital and Technology

Most venture capital investments are made, over time, by syndicates. This means a group of venture capital firms develops around a company, usually built over multiples rounds. Some of the firms in the syndicate agree to (or require) having a partner from their firm join the Board of the company. If you look at the roughly dozen boards I am on, most of them have multiple venture capitalists on them.

Unintended Consequences: When SAFE and Convertible Notes Go Awry

Pascal's View

The following scenarios represent typical recipes for trouble: Company X is early in business development, has a near-term need for capital to get through the next 3-6 months, and the management team has no understanding of how the equity should be divided up among its various constituencies (this includes option pools and what ownership stakes investors typically require at various development stages).

Bright future for London VC scene

The Equity Kicker

That’s great news for the startup ecosystem which has been short on capital for some time now, with the twin results that some companies are forced to invest more conservatively than they otherwise might whilst others move to the US and we lose their jobs and talent. Venture Capital

Venture Capital Syndicates

Florida Venture Blog

My past posts were more about people within a company, but a similar test of commitment happens within investor syndicates. As an investor that typically leads deals, Inflexion spends considerable time and diligence architecting the syndicates in our deals.

Venture Capital Syndicates

Florida Venture Blog

My past posts were more about people within a company, but a similar test of commitment happens within investor syndicates. As an investor that typically leads deals, Inflexion spends considerable time and diligence architecting the syndicates in our deals.

Transparent Funding Announcements

Feld Thoughts

Kyle followed the tradition of extreme openness about the financing process that I think Rand Fishkin started with his post three years ago titled Moz’s $18 Million Venture Financing: Our Story, Metrics and Future. Another company that did an awesome transparent funding announcement was Buffer (and app and company I love, but am only a tiny investor in via an AngelList syndicate) when they announced We’re Raising $3.5m

The Good, Bad, and Ugly of AngelList Syndicates

Inc Startups

The way start-up companies get funded is changing, and traditional venture capitalists aren''t pleased. The way start-up companies get funded is changing, and it''s freaking traditional venture capitalists out. Lower-tier venture capital firms will go bust.

Some Thoughts On InvestorRank

A VC : Venture Capital and Technology

This is an insightful way to look at the early stage venture capital business. But if I was investing in venture capital firms as an LP, this would be a big part of what I would look at. What is more important is the team, the strategy, and their ability to get into the right deals and build the right syndicates. Venture Capital and TechnologyChris Farmer , a VC with General Catalyst, presented some interesting data yesterday at Disrupt.

LP 53

On Corporate VCs

A VC : Venture Capital and Technology

That happened last Thursday night on the subject of coporate venture capital. I have written here before on the subject of corporate venture capital. The former is made by well established investment groups like Google Ventures, Intel Ventures, SAP Ventures, Comcast Ventures, and many many more. I apologize to all of the corporate venture firms that I insulted on Thursday night. Venture Capital and Technology

Paul Berberian Interview on This Week In Startups

Feld Thoughts

Earlier in the morning I read Jason’s post on LinkedIn titled The Great Venture Capital Rotation. I think it was originally titled “The End of Venture Capital Sort Of” (based on the URL).

Venture Capital Syndicates

Florida Venture Blog

congruence consistency dry powder foxhole syndicate strength value-add vc syndicates I’ve written before about how tough markets like this really separate the wheat from the chaff within a company. As if your company were a foxhole, you get to see who stays to fight by your side and who runs to another foxhole with more protection; or worse, who runs away from the fight altogether […].

The Rise & Fall of Great Venture Firms [Part 1] ? AGILEVC

Agile VC

The Rise & Fall of Great Venture Firms [Part 1]. I happen to be fascinated by the history of the VC industry, and one of the things we discussed at a recent offsite are the common threads behind the rise and fall of great venture capital firms.

Too Many Seed Investment Choices

Feld Thoughts

We are syndication agnostic – happy to invest alone and equally happy to invest with firms we like to work with. Venture Capital Foundry Group seed investings strategyYesterday I sent emails out passing on participating in two seed rounds for companies I really like. They had lots of investors trying to invest and each company was competitive with two other seed stage companies we’ve seen in the past 30 days.

The Strong Rejection

This is going to be BIG.

I''ve been helping to syndicate a few opportunities lately and what has really surprised me was how wishy washy the turndowns were. Venture Capital & Technology When I turn down the opportunity to invest in a startup, I really turn it down. I try and say exactly what I don''t believe will happen, or why I don''t believe in what you''re doing. In essence, I''m setting myself up to either be spectacularly wrong or to be right.

Managing Investor Pedigree

StartupCFO

It’s a known fact that not all venture firms are created equal. Cambridge Associates , an advisor to the Limited Partners that invest in venture capital firms, says that only about 20 firms – or 3% of all firms – generate 95% of the industry’s returns. . There’s a funny thing happening in today’s venture market: The fear of missing out is bigger than ever. So choose your syndicates with that risk in mind. Raising Capital Venture Capital

How early should you connect to a VC? Here's some data.

This is going to be BIG.

It''s also not the best way to create a helpful syndicate of investors that share the founder''s vision for the company. I went back across the 21 investments I''ve made both at First Round and at Brooklyn Bridge Ventures --a period that dates back to January 28, 2010, when I closed on Backupify. As for the two and a half year mark, it should say a lot to anyone looking to get into venture. Venture Capital & Technology

Valuations 101: Scorecard Valuation Methodology

Gust

Individual accredited investors in typical angel deals put personal capital at risk for an equity share of growth-oriented, start-up companies. Experience proves that half of these companies will fail (returning nothing or less than capital invested), another 3-4 will provide a modest return on investment of 1X to 5X and one or hopefully two of the ten companies will return 10X to 30X on the initial investment over a five to eight year period of time. – Need venture capital.

Make Your Own Decisions

Feld Thoughts

We describe Foundry Group ‘s behavior as “syndication agnostic.” Because we are syndication agnostic, we are delighted to work with great co-investors and welcome and encourage the interaction and partnership. Venture Capital decision making investing social proof” When we make an investment, we are completely agnostic as to whether or not we have a co-investor. This is true at early stages but also true at later stages.

Announcing K9 Ventures II – A $40M technology-focused micro-VC fund

K9 Ventures

I am pleased to announce the formation of K9 Ventures II, L.P. K9 Ventures started investing in 2009 with our first fund, K9 Ventures, L.P., With the new fund K9 Ventures will be able to invest between $250K – $750K as an initial investment in the companies we back.

Announcing K9 Ventures II – A $40M technology-focused micro-VC fund

K9 Ventures

I am pleased to announce the formation of K9 Ventures II, L.P. K9 Ventures started investing in 2009 with our first fund, K9 Ventures, L.P., With the new fund K9 Ventures will be able to invest between $250K – $750K as an initial investment in the companies we back.

Corporate Venture Capital: Obligatory or Oxymoron?

David Teten

She had so much insight to share that we broke the interview into two parts, 1) Corporate Venture Capital and more broadly, 2) How the Fortune 500 Can Buy, Invest and Partner with the Innovation Economy (coming soon). . Corporate venture funds are also investing earlier today.

Competing To Win Deals

A VC : Venture Capital and Technology

The venture capital business is highly competitive. Entrepreneurs want to choose their syndicate partners. By pairing up with another firm, you signal to the entrepreneur that you want to choose the syndicate and that is a mistake in a highly competitive deal. Tags: Venture Capital and Technology There is more money out there chasing good deals than most people imagine.

2011 Valuation Survey of North American Angel Groups

Gust

Speaking with many angel leaders , I believe we have identified several possible explanations for group-to-group variations: 1) Clearly, startup ventures in some business verticals command high pre-money valuations that others. 3) Some groups invest $2 million or more in pre-revenue companies, while others typically invest less than $500,000 in these very early stage ventures. Invested Interests angel investment fundraising pitching venture capital

How VCs Structure a Syndicate and Recruit Coinvestors

David Teten

First, a formal definition: According to Capital Dynamics , “Co-investments are direct investments in a company made alongside and on the same terms as a lead [General Partner]. GPs strategically invite trusted [Limited Partners and others] to co-invest, often based on the LP’s ability to add value or when the amount of capital required to complete an attractive transaction is larger than they are able to invest alone.”.

FreshBooks First Venture Round

StartupCFO

Today, FreshBooks announced that it raised $30M in its first venture funding round ever. In taking the long run perspective we evaluated every investor we met across the same criteria: - Long-term orientation with fresh new funding vehicles : All venture funds have a 10 year lifecycle.

Where are the Deals? How VCs Identify the Next Generation of Startups

David Teten

You’ve probably read dozens of articles about how to raise capital from venture capitalists. Prior to joining ff Venture Capital , I published the first-ever study of how private equity and venture capital funds originate new investments, with my coauthor Chris Farmer , CEO of SignalFire and an experienced VC. ff Venture Capital. First Round Capital. Capital.

Next move: RTP Ventures

Passionate Intensity

operation, RTP Ventures) will be formed and I will be running it. Despite the seeming safety and promise of my career in venture capital, I, once again, chose to do a startup — now a VC startup, not a VC-funded one. RTP VC Greycroft Partners RTP Ventures Venture Capital

Pro-rata rights: the good, the bad and the ugly

Fred Destin

The nature of the venture capital game, when played at a very early stage, is that one or two bets will generate most of your returns. What happens in most venture rounds for successful companies are the following three things: Everyone wants in. Whatever lullaby VC’s might tell you about long-term commitment to your startup, we do seed investing for a reason, and that is to limit the amount of capital we commit at the outset until we are ready to commit more (duh).

HBS Alumni Angels assets for investing in women and minority-led startups

David Teten

Harvard Business School is featuring an article about the Venture Capital Access Program on the website of the U.S. HBS Alumni Angels of NY has many Members (including me) who are institutional venture capitalists. Since 1970, NAIC Member firms who focus on private equity and venture have invested in and transformed more than 20,000 companies. Diversity Entrepreneurship HBS Alumni Angels New York NextNY Venture Capital Women

What VC Can Learn From Private Equity

A VC : Venture Capital and Technology

Finally, the first venture capital firm I helped start, Flatiron Partners, was backed by and initially housed inside a private equity firm, Chase Capital Partners, and Jerry and I learned a lot from attending their weekly investment meetings and listening to them talk about their business. Venture Capital and Private Equity are very different investment disciplines. Venture Capital is minority investing. Venture Capital requires it.

Introducing our latest investment: Mattermark – Big Data Comes to VC

Version One Ventures

Thus, it should come as no surprise that we are now seeing Venture Capital being disrupted by these forces as well. In his post The Disruption of Venture Capital , Albert Wenger described VC as “the club you had to be invited into.”. start-up databases/networks like CrunchBase and AngelList ) has led to unparalleled access to investment capital as more seed funds, angels, and syndicates emerge on the scene. Image via CrunchBase.

Do you matter to your investors?

StartupCFO

We are thinking through some of these issues at Real Ventures. But a good number are minority investments where we are part of a syndicate. Angels Venture Capital Angel List Fundraising syndicates VCThe model for funding tech startups has changed a lot in recent years. While angel investing has been around forever, Angel list is blowing it up, making it easier for angels of all shapes and sizes to find deal flow and come together.

VC Syndicates: How Many VCs Is Too Many?

A VC : Venture Capital and Technology

But beyond the board, what about the syndicate? I've seen some recent financings where there were six or more VCs firms in the syndicate. We've been asked to participate in first round syndicates with four or more VC firms and we have not done that, at least yet. If you have that many VC firms in your syndicate, then each one will own something like 5-7.5% Tags: Venture Capital and Technology