Private Equity
10 min read · 25 May 2009
Anyone have any ketchup for my plate of crow? You may recall that I wrote a post on May 13 entitled “Why It Sucks to Be a VC.” I ran some numbers based on the expected price OpenTable’s IPO ($13 per share) and found that the 12.5 million shares held by the VCs would be worth about $162 million. Given that they had collectively invested about $69 million in the online restaurant reservation service, the VCs were looking at a potential return multiple of 2.36. That was then. Today, OpenTable (Nasdaq: OPEN) priced at $20 per share and rocketed to $31.89 by the end of the day in what Reuters reports as the best first-day performance for a U.S. company in 18 months. As a group, the VCs are now looking at a potential multiple of 5.78x.
2 min read · 21 May 2009
In yet another indication of how tough the venture market has become, the most active investor in April was none other than secondary investor Millennium Technology Ventures, according to preliminary investment data gathered by Thomson Reuters (publisher of peHUB). I’ve been compiling a monthly “most active” list for Venture Capital Journal since 2002, and this is the first time in my memory that a secondary firm ranked No. 1 on the list. Our data show that Millennium invested in seven companies in April, beating out the likes of Sequoia Capital (five companies), Kleiner Perkins Caufield & Byers (four), Benchmark Captal
2 min read · 14 May 2009
Online restaurant reservation service OpenTable has set the terms for its IPO—and they don’t look wonderful for its venture backers (see table after the jump). As a group, VCs invested a total of close to $69 million in the company, but at $13 each their shares would be worth a combined $162 million following the IPO. That means the VCs would have collectively earned a return of just 2.36x on their investment (were they to cash out at the IPO price). The only VC that stands to earn a decent return is Benchmark Capital. It invested an estimated $12.7 million over two rounds (according to data from peHUB publisher Thomson Reuters). With 5.3 million shares that would be valued at $68.8 million, Benchmark is looking at a potential multiple of 5.4x. Still, that’s not great for nine years of work.
3 min read · 13 May 2009
New York State Comptroller Thomas DiNapoli today released a detailed list of placement agents that were involved with investments made by NY Common Retiremenrt Fund under former Comptroller Alan Hevesi. You'll recall that two of Hevesi's top aides - David Loglisci and Hank Morris - were recently indicted on charges they took kickbacks to steer billions of dollars of state pension dollars to certain private equity funds. Morris and Loglisci, who face 123 charges, have pled not guilty. Late last month, New York banned the use of placement agents. Here's the list: New York Placement List Publish at Scribd or explore others: Brochures & Catalogs How-to-Guides & Manu fantasy Games
1 min read · 06 May 2009
Everyone knows the fund-raising market has gotten more difficult, but a table I put together for a webinar I’m hosting tomorrow shows just how bad it is. Take a look below. Just skimming through a couple of months of coverage in Venture Capital Journal and PE Week, I was able to identify at least 16 firms that came up short of their goals. In one case, a firm abandoned fund-raising altogether and in another the firm postponed it till the market improves. I don’t think we’re going to see any improvement any time soon—for GPs, anyway. In fact, Private Equity Insider just reported today that Draper Fisher Jurvetson has cut the target of its 10th fund from $600 million to $400 million and it’s offering better terms for LPs, including carried interest that starts at 20% instead of 25% and is based on performance benchmarks.
3 min read · 06 May 2009
Is Chrysler The Worst PE Deal Ever?
6 min read · 01 May 2009
Is Chrysler The Worst PE Deal Ever?
6 min read · 01 May 2009
UPDATE: Just heard back from Battery and was told that Tom Crotty will in fact continue as the firm's "managing GP" in its ninth fund, and that he will start to step back with fund X -- not fund IX, as we previously reported. The firm declined to say when it would start raising fund IX or give an approximate time line for when fund X would get raised. ORIGINAL POST: Longtime Battery Ventures General Partner Tom Crotty won’t be a GP in the firm’s 10th ninth fund, according to my colleague David Toll, who spoke to Crotty at the NVCA annual meeting. Crotty also said that Battery’s next fund will likely be the same size as its current fund—a $750 million core fund and a $250 million sidecar, Toll reports.
2 min read · 30 April 2009
4 min read · 30 April 2009
