Private Equity
Even as some investors are pulling back from foreign countries -- as Battery Ventures said it would do in India -- the forces that drive globalization are relentless. VCs in China, India, Japan and Israel all raised more money last year than they did the year before, according to data from Thomson Reuters (via the MoneyTree report), and in China the jump was big: $4.2 billion in 2008 compared to $2.5 billion in 2007. For the first time, China last year had more Internet users than the U.S. -- 2/3 of them under the age of 29 -- and it is expected to be the world's second largest economy by 2025 (although India will have surpassed China by then in population). At the same time, China is in a very different place than the U.S. in its development of technology and startups, several VCs have told me, even though U.S. companies and investors don't always get that.
2 min read · 08 September 2009
Greylock Partners this week invested $4 million in HealthHiway, which was launched two years ago by Apollo Hospitals Group and IBM to provide Web-based software for hospitals, doctors and insurance companies to store and maintain patient records, radio images, insurance claims and similar items. HealthHiway is part of a plan to build a National Health Data Network in India and is looking for more funds. Last week, in California, MedSphere Systems said it raised $12 million to push adoption of its open source electronic health records (which are based on the VA's system) from several venture firms, including Azure Capital, Epic Ventures, Thomas Weisel and others. Hospitals in the U.S. have to adopt electronic health records by 2011 if they want to be eligible for federal stimulus money. National Public Radio this week had a fascinating story on a doctor who's been computerizing her office. It hasn't been quite what she expected --
2 min read · 04 September 2009
University of San Francisco adjunct professor Jon Fisher co-led a $500,000 investment this week in Linksify, a contact management company that he portrays as a killer of Facebook and LinkedIn. Fisher was the CEO of Bharosa, a security company bought by Oracle a couple of years ago, and he's argued that IPOs are no longer an option for most startups -- instead, entrepreneurs should be building businesses that other companies want to buy.
2 min read · 04 September 2009
"We all thought it was good then," said Steve Bengston at PricewaterhouseCoopers, who gave a presentation last night in Palo Alto. But an even bigger problem for VCs are exits -- later stage deals are getting larger (PWC recorded some Series O rounds), the IPO market is still weak, and prices on mergers and acquisitions are being hammered down. Fundraising is also way down: "If you can avoid raising money in 09, you should," he said. When VCs suffer, so do entrepreneurs -- Bengston said he sees "major triage" of portfolio companies by VCs, in a phenomenon he called "men behaving badly."
2 min read · 04 September 2009
National Venture Capital Association president Mark Heesen was in Silicon Valley this week, meeting with VCs and LPs and drumming up memberships. Membership has not been shrinking, he says, despite recent dire predictions of a shrinking venture capital industry. Maybe that's because most VCs are natural optimists. But he is keeping an eye on these issues:
2 min read · 04 September 2009
Plenty of people over the last couple years have said not -- that VCs don't like to stick with investments that take a lot of money and time, that they don't understand the issues, that they don't know the ways of Washington, D.C., that they're too used to cranking out IT startups according to a fast-growth, low-investment formula that worked well in Silicon Valley when times were good. Mike Kanellos over at GreenTech Media says they're wrong. (Disclosure: I used to work with Mike at CMP Media). In a long post this week, he cites several high-profile, clean-tech disasters but then lists all the reasons why VCs are good for clean tech:
2 min read · 03 September 2009
There was a new emphasis on making money at the Facebook Fund’s third annual Demo Day today in Palo Alto, where 25 startups showed off what they'd created after 12 weeks in Facebook’s incubator. Several people were wearing white T-shirts proclaiming “REVenue is sexy,” and entrepreneurs were encouraged to brag if they've been able to make profits or raise money. A few had. Also, unlike past years, most of the companies do NOT make games. The star of the show, Thread.com -- an application that uses information from Facebook to connect friends of friends who might want to date each other -- announced a $1.2 million Series A round from Sequoia Capital, the Founders Fund and several other investors, including Ron Conway and LinkedIn’s Reid Hoffman.
2 min read · 02 September 2009
The firm announced two new funds, both over-subscribed -- a $750 million fund for early and mid-stage startups and a $250 million seed stage fund for high-risk ventures at universities. CalPERS committed $60 million to the seed fund -- which will invest 75 percent in clean tech and 25 percent in information technology -- and has committed $200 million to Khosla overall. Principals of the seed fund include Pierre Lamond, an engineer with a long Silicon Valley track record. He co-founded National Semiconductor, worked at Cisco, and chaired several big tech companies -- including Cypress Semiconductor and Redback Networks -- before turning to clean tech. He joined Khosla in March from Sequoia Capital (also rumored to be looking at seed investments).
2 min read · 01 September 2009
As the third largest direct shareholder in Marvel Entertainment, Breyer stands to make nearly $5 million once Disney's acquisition of the superhero company closes. Disney said this morning that it plans to pay $4 billion in cash and stock for Marvel. Marvel shareholders -- Breyer has 165,700, according to regulatory filings -- will get $30 a share plus around 3/4 of a Disney share, a 29 percent premium over Marvel's closing price on Friday. Breyer's venture firm, Accel Partners, has no investment in Marvel. But Breyer said his own investment came about several years ago as part of a "prepared mind" strategy.
2 min read · 31 August 2009
A few weeks ago, several of you came up with companies that let people tailor and order clothes online --A Tailored Suit, LoriCoulter.com, Archetype Solutions, Indochino and even Lands' End. One of them, MyShape.com, has just raised money --$10.56 million of a $12 million Series C round, according to a regulatory filing last week -- from Draper Fisher Jurvetson, Tenaya Capital and Tech Coast Angels. But MyShape is not just another online clothing company, according to investor Steve Jurvetson. The site is especially aimed at aging females -- women between the ages of 55 and 64, who, he says, are the fastest growing category of online shoppers except for teenagers. In June, Jurvetson went to Santa Clara University's annual Silicon Valley (Baby) Boomer Venture Summit and Business Plan Competition to hunt for candidates for DFJ's growing interest in companies that serve the aging, an area that he says is new to venture capital.
2 min read · 31 August 2009
