Private Equity
I think that this bill, without analyzing every line on every page, will have some positive effect on healthcare investing and finance. 1. The removal of uncertainty is good. Now that there is at least some idea of what the new rules will be, investors, and strategic participants in the business can react. Some of the investment press has already suggested that healthcare will be a good place to be - the WSJ had a pretty good article this morning about winners and losers. Hopefully some of the prospective buyers and sellers of healthcare businesses who have been on the sidelines for awhile will now be back in the game. 2. Healthcare investing, both public and private, has historically been compared to a swinging pendulum. Time the swing right, and you make money. This phenomenon has been reinforced by healthcare entrepreneurs, particularly on the services side, who have a knack for sorting out government regulation and other business impediments. When the government changes the rules, they scramble and figure out how to make money in the new game, and when they pendulum swings, they win. Of course after the commercial interests have mastered the new rules, the government takes notice of all the money being made, and changes the rules again. The game starts over. Entrepreneurs will look at the new rules and go to work.
3 min read · 23 March 2010
It seems lately like every new deal announcement that comes across the wire somehow involves a healthcare company. Perhaps it is just one out of every ten transactions that actually does involve a healthcare industry business; nevertheless, I cannot get over the fact that there just seems to be an influx in activity within this segment of the markets lately. Just within the past month, we’ve practically seen every kind of possible transaction that we can imagine involving medical companies, from buyouts of UK-based home health companies to HCA’s $1.75 billion special dividend, for which it received a significant amount of criticism from the financial media. And it seems like everyone is trying to get a seat on the healthcare value train, including Richard Branson’s Virgin Media and The Kroger Company, both of which have announced recent deals acquiring healthcare services companies.
7 min read · 22 March 2010
I mentioned in my last post that I decided to write a book about venture capital and entrepreneurship, which is coming out next month (see http://bit.ly/mstrVC). In this post, I wanted to answer the question: "Who did you interview?" Selecting interviewees was a tricky process. The purpose of the book is to be a helpful guide for entrepreneurs as they navigate the process of building their companies in partnership with VCs, so I wanted to capture the voices and insights of both entrepreneurs and VCs. In particular, I wanted to capture a diverse group - diversity in terms of geography, industry focus, gender and age.
2 min read · 22 March 2010
5 min read · 18 March 2010
3 min read · 17 March 2010
3 min read · 11 March 2010
"I've decided to write a book," I told my wife over a year ago. She gave me that what-the-bleep-are-you-talking-about look. You may be familiar with your spouse. "You've what?" "I've decided to write a book," I repeated, slightly less confidently. "On what?" "Venture capital and entreneurship." "Why?" "Well, when I was an entrepreneur, I couldn't find any good books on how this mysterious capital-raising process worked and how to harness the resources and knowledge of the VC industry to help build my start-up. Now that I've seen it from the other side, I want to explain to entrepreneurs how it all works to help them be successful. There are good blogs out there, but no good books that pull it all together."
2 min read · 10 March 2010
Recently an entrepreneur extraordinaire I admire by the name of Chris Dixon touched on the two general paradigms people/institutions can adopt towards one another when conducting business. He first referenced the transactional/legalistic approach wherein labor is exchanged for money in the form of a contract that is enforced by organizations, (especially the legal system). The other approach is one based on trust, verbal agreements, reputation and is "enforced" (so to speak) by the community. As Dixon points out, the world of startups is overwhelmingly governed by the trust/reputation/community approach. Let's just juxtapose these very different paradigms against the backdrop of the modern American university. As we've established in earlier posts in this series, it has now become fashionable and accepted for universities and their tech transfer offices to engage in the practice of spinning-off companies based on their intellectual property and know-how. In fact, according to AUTM statistics, over 600 university startups are created every year based on federally funded R&D.
5 min read · 05 March 2010
I'll never forget my first marketing class at business school. Our professor peered at us with an intense glare as he pushed back on our standard, "chip shot" comments. At one point he asked the guy next to me to opine on the case we were discussing, which involved launching a new consumer product. "Well," my neighbor answered confidently, "I think it will be a hit because I can see my mother-in-law buying it." "I see," replied my professor dryly and then turned to the class with a withering look on his face, "Steve appears to have fallen into that fatal trap of 'Mother In Law Market Research' - believing this new product will be a hit just because his mother-in-law likes it. Instead, let's look at the data, shall we?"
3 min read · 26 February 2010
2 min read · 10 February 2010
