Private Equity
3 min read · 30 March 2009
Because of the problems caused by AIG, the government is correctly considering regulating previously unregulated institutions that have the potential of becoming too big to fail. In testimony before the House Financial Services Committee today, Treasury Secretary Timothy Geithner suggested that venture capital and private equity firms may be required to register with the SEC. Bill Gurley of Benchmark is concerned about Geithner’s remarks, but I just don’t see this as an issue for VCs to get worked up over. Geithner said he wants to regulate financial and non-financial entities that “collectively pose a threat to financial stability.” The entire U.S. VC industry manages roughly $250 billion, according to the NVCA, and those venture investments are essentially illiquid. Unlike AIG, there is nothing that a single venture firm (or even the industry as a whole) could do to imperil the U.S. financial system.
2 min read · 26 March 2009
If you’re looking for what’s cool in Series A deals, check out the Small Business page on Reuters.com’s Business & Finance Channel every Monday. Joanna Glasner and Alex Haislip, writers for for peHUB sister publication Private Equity Week, drill down into a cool startup every week. This week’s feature is about NKT Therapeutics, which just raised $8 million to develop asthma treatments. Past features by Joanna include a look at a stem cell startup called Stemgent and a company called Simulmedia that’s trying to create TV advertisements that are targeted at specific viewers. If you know of any particularly cool startups raising Series A financing, feel free to pitch me at lawrence.aragon@thomsonreuters.com.
1 min read · 23 March 2009
Maybe the VC model is broken after all. The VCs who backed hot digital video recorder maker Pure Digital Technologies Inc. have agreed to sell the company to Cisco Systems for $590 million in stock. At first, it sounds like a pretty good deal, but you have to understand that the VCs put $95 million into Pure, which makes the Flip digital video camera. Assuming they own half of the company, that’s a return of just over 3x their money. For a middle-of-the road VC firm, that would be a decent return, but for big name backers Benchmark Capital and Sequoia Captial that’s pretty much a dud.
1 min read · 19 March 2009
In his recent appearance on the “Charlie Rose Show” Google CEO Eric Schmidt made the claim that Bill Joy uses Google to find venture investments. I emailed Joy, a partner at Kleiner Perkins Caufield & Byers, to find out if the somewhat kooky claim is true, but he didn’t respond. Schmidt, who used to work with Joy at Sun Microsystems, says his friend “uses Google to search for all the new ideas. He reads the papers, so he figures out what the search query is. He reads the paper, and then he calls the to say, ‘What’s new? What’s innovative?’”
2 min read · 18 March 2009
Hires, promotions and other personnel changes at Centenela, Adveq, Braemar, MDV and more firms
2 min read · 16 March 2009
In these lean times, everyone is looking for ways to save a buck. Well, do I have good news for you. Venture Capital Journal has compiled a list of a dozen money-saving ideas--from relocating some workers abroad to pooling portfolio companies to seek bulk discounts. I've made the story free for non-VCJ subscribers today. Check it out here.
1 min read · 11 March 2009
In the more-bad-news-for-VCs file, the cash cow known as Google has been deliberately inactive on the the M&A front because it's waiting for "prices to get better," according to CEO Eric Schmidt. Silicon Alley Insider reports that Schmidt told the Morgan Stanley tech conference conference today that Google's M&A activity is "pretty inactive right now" because "we've largely been waiting for prices to get better." Yes, you read that right. The company that had $15.85 BILLIOn in cash, cash equivalents, and short-term marketable securities as of Dec. 31, is worried that it's going to overpay for a startup.
1 min read · 04 March 2009
2 min read · 02 March 2009
2 min read · 02 March 2009
