Will VCs Find The Third Leg Of Their Liquidity Stool?
Last week, we got word that a Boston-area venture firm was informally shopping one of its hottest portfolio companies to other VC firms. Not shopping the whole thing, mind you, but just the venture firm’s stake. So I called one of the firm’s managing partners, who was understandably cagey in his response. “We’re always talking to other firms about our companies. Sometimes we call them, and sometimes they call us. And we’re obviously scouring other firms’ portfolios, to see if there’s anything there that we might want to express interest in.” My point here isn’t to report on the specific situation (still not quite comfortable enough, despite the non-confirmation confirmation), but rather to suggest that venture capital may finally be getting around to recognizing sponsor-to-sponsor sales as a viable exit avenue. It’s what helped buyout firms begin their gold rush earlier this decade, and may be venture’s last best hope for juicing wilted returns.
