Given this year’s retreating stocks, ebbing M&A market and weak technology spending, venture capitalists at companies such as Cisco Systems, Nvidia and Qualcomm might not be the most ebullient of guys.
But the doom and gloom is not has thick as you might think. Yes, startup investments at many of these major firms will be down in 2009, following the spiraling economy.
Yet most say they want to be opportunistic and to step into attractive deals when managers of VC funds run for the hills. Some say they even expect their spending to rise or remain the same as this year’s, despite the uncertain environment.
“The economy is going to be down a bit, so I expect the pace to go down,” said Sanjiv Parikh, a managing director at Hewlett-Packard’s corporate ventures. But “I expect us to be opportunistic.”
Cisco invested 460 million in the fiscal year ended July 2008, $100 million of which went into funds targeting markets in Eastern Europe and Russia, said Hilton Romanski, vice president of corporate development at Cisco.
“We’re going to be down from that the next fiscal year,” Romanski said at the AlwasyOn Venture Summit. Yet, Cisco recognizes there will be opportunities as startups and VCs need corporate partners and money more than ever, he said.
With corporate initiatives continuing to roll forward, such as Nvidia’s promotion of its CUDA scientific computing environment for graphics chips, there will be clear roles for well-positioned startups, said Nvidia Vice President of Business Development Jeff Herbst.
Nvidia put money in four to five startups this year. It will do about the same next year, he said.
Qualcomm also may see an increase next year, said Nagraj Kashyap, vice president at Qualcomm Ventures. As VCs step back, Qualcomm can deploy more capital, he said.
“We would expect the number (of deals) and the amount to increase next year,” he said.
Jean-Baptiste Su
Mark Boslet
