I respect Tom Friedman. Hell, I envy him. But the man has taken temporary leave of his senses, by repeatedly arguing that some sort of venture capital bailout is in order. First, he penned a piece arguing that VC-backed cleantech companies were "dying like flies," due to a lack of capital. I’ve repeatedly written about the lack of project finance for the handful of VC-backed startups that need it (mostly facility-heavy electric vehicle and biofuel producers), but Friedman vastly overstates the problem. Moreover, he fails to note that a number of firms rushing in to fill the void, including Blackstone, C Change, CMEA and Kleiner Perkins. Then came a follow-up column, in which he wrote:
2 min read · 23 February 2009
Réal Desrochers has resigned as head of alternative investments for the California State Teachers' Retirement System (CalSTRS), according to a source familiar with the situation. CalSTRS is expected to make a formal announcement later today. Desrochers joined CalSTRS in 1998, after having managed a global private equity portfolio for CDP Capital. The system currently has around $17.1 billion in private equity assets under management, which represents a 14.3% exposure (compared to a 9% target). "Réal had been planning his departure for some time but he kept it close to his vest until very recently," says the source, who adds that Desrochers' "contributions to the private equity program at CalSTRS have been immense."
1 min read · 23 February 2009
Mid-market lender Churchill Financial yesterday laid off around one-third of its staffers, peHUB has learned. Most of the cuts came on the origination side, as Churchill has been hammered by the industry-wide deal drought. "The number of origination folks we had compared to the number of deals we had was just out of whack," says a source within Churchill. "These were good people in a bad situation. It didn't have anything to do with them individually... If things turn around, I'd imagine we'd jump right back into hiring mode."
1 min read · 20 February 2009
Anonymous VC writes: "A comfort capitalist is a venture capitalist who has no idea what to do in the downturn. His true colors of not knowing anything -- or having never done anything -- are now revealed and cannot help companies plan through the mess. He is too scared to take a venture into a new deal. Instead, the comfort capitalist renews his roots by attending more conferences, VC gigs, open coffees and a "how to" course in looking very busy."
1 min read · 20 February 2009
Add Appian Ventures to the (growing) list of venture capital firms that do not expect to add new portfolio companies in 2009. Chris Onan, a partner with Denver-based Appian, says that the firm simply needs to reserve remaining dry powder to support its 18 existing portfolio companies. At the same time, Appian doesn't want to begin raising a new fund without a few more exits under its belt.
1 min read · 20 February 2009
It’s been more than a year since Silver Lake Partners announced a new deal from its third general fund, a $9.3 billion vehicle closed at the end of 2007 (it also has a credit fund and mid-market fund. I figured that such inactivity could put Silver Lake next in line for a fund size cut, but sources tell me that the firm has no interest in such a thing. Moreover, they say that Silver Lake been a bit busier than its press release void might indicate. So I sent into the CalPERS data trove, to look at Silver Lake III call-downs since last February. It shows around $60 million in cashed checks, which is about
1 min read · 20 February 2009
Want an illustration of the dreaded denominator effect? Just take a look at some new numbers from the Pennsylvania Public Employees’ Retirement System (PERS), which last week released its 2009 Supplemental Budget Information. It shows that PERS had a 24.2% exposure to alternative investments at of the end of 2008. This compares to just a 15.6% exposure to alternatives at the end of 2007 (which was already higher than the system’s 14% target allocation). We asked PERS spokesman Robert Gentzel about the situation, and he replied: "As you noted, the current actual allocation is well above the target. Until it is brought more into line over time, we would expect few, if any, further commitments." The PERS document also includes details of fees paid to VC and buyout managers last year, and some fund-specific cash in/cash out information. We’ve posted it all here, in .pdf form (we wanted to use Scribd, but it seems SERS encrypted the file).
1 min read · 20 February 2009
Allen Stanford can run, but apparently he can't hide forever. The alleged grifter disappeared several days ago, after the SEC accused him of around $8 billion worth of rip-offs. Among his clients were a small handful of venture capital and buyout shops. Today, however, the FBI says that its Richmond, Va. office served Stanford with civil papers. No arrests were made, as the FBI was only carrying out an SEC request. While we await more details, it seems the SEC has found an even minier Madoff. It's only around $4 billion, but this one might be the scummiest yet. How come? Because he specifically recruited deaf clients. And the sad thing is that the worst is probably yet to come...
1 min read · 19 February 2009
Benchmark Capital has quietly re-invested in a San Francisco-based company called 1Life Healthcare, which operates a network of boutique medical practices. Kind of like concierge medical care for the not-yet-wealthy urban professional. The most recent round was for $8 million, although it’s unclear if Benchmark was joined by fellow existing shareholder Pinnacle Ventures.
1 min read · 19 February 2009
Yesterday I wrote about a stealthy new buyout firm, so today it's only appropriate that I write about a stealthy new venture firm (given peHUB's charter to cover both markets, and all). The newbie is Makaira Venture Partners, a Stoughton, Mass.-based shop that will focus on early-stage medical device and other non-pharma life sciences opportunities. It's the outgrowth of an in-house incubator/accelerator program at STD Medical Inc., a 50-year-old medical device manufacturer whose clients include Boston Scientific (and whose acronym is quite unfortunate). The STD incubator (wow, that sounds disgusting) was mostly funded by angels and local VC firms, but the independent Makaira plans to raise around $50 million for its debut fund (PPM in process). It will hit up both high-net-worths and more traditional LPs (endowments, foundations, pensions, etc.), with formal marketing expected to begin shortly.
2 min read · 19 February 2009
