Churchill Club Top Trend: Why D.C. Is A Bad VC
May 21, 2009
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Posted by TechPulse 360
Churchill Club’s Top Tech Trends: Millennium Generation, Energy, Mobile And The Next Web
May 20, 2009
This year's top tech trends include the millennium generation, cleantech, mobile applications and the web.
It was a full crowd tonight for the Churchill Club’s 11th annual Top 10 Tech Trends event; maybe because there were actually 12 trends!
This year’s high-powered panel included:
- Steve Jurvetson, Managing Director, Draper Fisher Jurvetson
- Vinod Khosla, Founder, Khosla Ventures
- Joe Schoendorf, Partner, Accel Partners
- Ram Shriram, Managing Partner, Sherpalo Ventures, LLC
- Ann Winblad, Partner, Hummer Winblad Venture Partners
The event was moderated by Silicon Valley celebrity Tony Perkins, founder of AlwaysOn and Jason Pontin now editor in chief and publisher at the MIT Technology Review magazine. Both were at the helm of the Red Herring magazine during the go-go days!
New this year was the inclusion of 5 trends picked from “crowd sourcing”, scouring the Web and the media for the most discussed and popular trends.
Perkins and Pontin also had the opportunity to pick their favorite trend.
Here’s the list of all the trends discussed.
- The Millennials Are Here. Everything is changing rapidly – Joe Schoendorf
- The unstructured data deluge creates the next great information leaders – Ann Winblad
- “Maintech” not “Cleantech” – Vinod Khosla
- The triumph of the distributed Web – Steve Jurvetson
- Consumption of digital goods on mobile devices is THE growth story of the coming decade -Ram Shriram
- DC will prove to be a poor VC – Tony Perkins
- The rumors of the demise of the reporter have been exaggerated – Jason Pontin
- Advanced batteries will be the most popular alternative energy investment in 2009-10 – Crowd idea
- Wireless broadband that will one of the only IT sectors to see increased funding this year – Crowd idea
- Power and efficiency management services will see a flowering of investment and innovation – Crowd idea
- Healthcare administration will see the best growth in B2B software in 2009-10 – Crowd idea
- Electronic displays will prove the hottest investment in hardware this year and the next- Crowd idea
More in later posts with videos and additional commentaries. Meanwhile here’s the video excerpt introducing tonight’s event:
Leave a Comment » | Alternative Energy, Clean Tech, economy, Events, hardware, news, software, startups, venture capital, wireless | Tagged: accel, AlwaysOn Pontin, Draper Fisher Jurvetson
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Posted by TechPulse 360
European Clean Tech Investing Trumps The U.S. In The First Quarter
May 8, 2009
It is the first time since 2005 that European investments outgrow those in the US
The venture-capital industry is in a trough, to put it politely. But not clean-tech investing in Europe, where VCs are apparently looking at the long-term horizon and not becoming overly fixated on today’s low oil prices.
Dow Jones VentureSource found that in the first quarter, energy and utility-industry startups in Europe raised $289 million, an increase of 82 percent. The total was helped in part by a large investment – $192 million – placed in NorSun of Oslo, Norway.
But even still, the rise came as venture-capital investing in Europe overall fell 35 percent, and around the world (not including the U.S.) tumbled 50 percent.
In the U.S., VC funding for energy and utility-industry companies fell 59 percent during the same three-month period. While it came to $457 million, more than what was spent in Europe, the number of deals plunged to 15 from 24 a year ago.
Renewal energy companies took it particular hard. Money going to them fell 73 percent.
The European clean-tech deal count also was down, to 10 from 18 a year ago. But it was the first time since 2005 that European energy-related spending outpaced spending in the U.S., said Jessica Canning, director of global research at VentureSource.
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Posted by Mark Boslet
In A Slow Merger Market, Companies Like ShotSpotter Make Discriminating Buyers
April 29, 2009It is no secret that many venture-backed startups would give their first-born children to be acquired.
That’s because the alternative is bleak. VCs are handing out cash slower than they have in a decade, and many companies without suitors are forced to close their doors.
Unfortunately for many of these partner-hungry startups, the deal flow also is at a low. In the first quarter, only 68 venture-backed companies were sold, down 35 percent from 104 a year earlier.
"People do approach us monthly, if not weekly" interested in being acquired, says James Beldock
That makes ShotSpotter’s deal announced Tuesday all the more worth looking at. ShotSpotter announced the acquisition of Planning Systems, a unit of QinetiQ North America, for an undisclosed amount.
“People do approach us monthly, if not weekly,” says James Beldock, CEO of ShotSpotter, referring to the stream of startups eager to sell themselves.
But instead of a deal simply to increase the company’s size, Beldock settled on a merger with hands-down strategic value.
ShotSpotter sells technology that enables police departments in cities around the country to pinpoint the location of gunshots. It uses sensors, as many as 20 per square mile, to continuously monitor troubled areas.
Planning Systems makes a similar technology for military and defense markets. And it has key sensor patents.
“It clearly is a buyer’s market,” says Beldock. And that buyer is more discriminating than ever.
3 Comments | news, startups, venture capital | Tagged: Acqusitions, Mergers, ShotSpotter, startups, venture capital | Permalink
Posted by Mark Boslet
Venture Returns Plummet
April 27, 2009Venture-capital returns plummeted over the past year and more pain is likely ahead.
One-year returns through December were -20.9%
One-year venture returns through December 2008 were -20.9 percent, a drop of 18.8 percentage points from September, according to Thomson Reuters and the National Venture Capital Association.
Challenging conditions will continue as portfolio venture-backed companies are selling for lower prices and the IPO window has been shuttered, said Mark Heesen, president of the NVCA.
Over the longer term, venture returns remained positive as of December, but at a lower rate. Three-year returns were 4.2 percent and 10-year returns were 15.5 percent.
Both were down from September and are expected to fall further during this year.
1 Comment | news, startups, venture capital | Tagged: Investment Returns, National Venture Capital Association, Thomson Reuters, venture capital | Permalink
Posted by Mark Boslet
Clean Tech Angel Investors Form A Network For Finding Deals
April 22, 2009Venture capitalists have fled clean-tech investing. This is due to the fall in the price of oil, and to the lingering global recession, which has nailed shut the market for IPOs.
VCs have moved away from early stage clean-tech investing, says Jon Bananno
In the first quarter, clean-tech investments plummeted 59 percent with only 15 deals completed, down from 24 deals a year ago.
“The clean-tech investing business is somewhat in the doldrums,” says Dan Adler, president of the California Clean Energy Fund. “We’re back to where we were in 2005.”
Adler and several of his colleagues hope to see this change, and on Tuesday formed a network of angel investors to back clean-tech startups.
The aim of the Cleantech Angel Network of Networks is to close a funding gap that Adler and others say exists for the earliest of clean-tech companies. A lot of VCs moved away from backing early-stage startups in the category, says Jon Bonanno, chairman Keiretsu Forum’s Cleantech Investment Committee.
Along with the California Clean Energy Fund and Keiretsu, the network includes Kuwait Petroleum Energy Ventures – firms that together represent as much as $40 million in investment capital, says Mark Nydam, managing director at PCG Asset Management. The hope is other members will join.
The announcement of the angel network was made at the Dow Jones Alternative Energy Innovations conference in Redwood Shores.
10 Comments | Alternative Energy, Clean Tech, news, startups, venture capital | Tagged: Angel Investors, Clean Tech, Venture Investing | Permalink
Posted by Mark Boslet
Gaming Startups Fail To Attract Large Venture Investments
April 21, 2009
Comparatively speaking, gaming startups tend to attract less VC fundings than other tech companies
Gaming is hot, but venture investments in the sector are still much lower than most other tech sectors.
Last year, gaming startups – mostly from Silicon Valley and some in LA/Orange county – raised a total of $315 million in 53 deals.
“It’s not a huge sector. Actually most of the big winners don’t have venture funding. And that’s because gaming is a hits business which gets a disproportionate influence despite its lack of investing,” said PwC managing director Steve Bengston at SDForum’s event on gaming investing.
In his retrospective of last year’s gaming investing, Bengston outlined the top 5 gaming venture investors (Silicon Valley’s Founders Fund, Redpoint Ventures and True Ventures and East Coast-based Columbia Capital and Greylock Partners).
Also speaking at the SDForum event were venture capitalists Ken Elefant of Opus Capital, Michael Kim of Rustic Canyon Partners and Ho Nam of Altos Ventures, who were sharing their experience in gaming investing which I will cover on a upcoming post.
Leave a Comment » | news, software, startups, venture capital, Video Games | Tagged: Altos Ventures, bengston, Columbia Capital, elefant, Founders Fund, Greylock Partners, Opus Capital, Redpoint Ventures, Rustic Canyon, True Ventures | Permalink
Posted by TechPulse 360
Venture Industry To Shrink By Half In 2009; Bottoming At $15 Billion
April 21, 2009
With lack of "exits", venture capital less attractive to investors, says Steve Bengston, a managing director at PwC
The venture capital industry is going to get a lot smaller than anyone expected.
Speaking this morning at the SDForum’s event on investing in gaming, PwC managing director, Steve Bengston, predicted the venture industry is heading back to it’s 1997 levels; investing about $15 billion annually versus over $28 billion last year, and $105 billion in 2000.
“This year will be better than 1997, when we had a viable healthy venture capital business. However, only half of the firms and the general partners today will survive. But there’s nothing inherently problematic to this as it always was the top quartile that made all of the money anyway,” explained Bengston.
For the PwC executive and all the major investors, the question that remains is who are going to be those leading VCs.
“Venture capitalists have not been good at transferring their skills to the next generation. Today, most of the original founders are still in place but when they leave, we might see funds go to younger firms,” adds Bengston.
Another issue that plagues the venture community is the lack of returns which makes it a less attractive to large investors.
“Venture investing is a risky asset class, and investors are asking for a premium in returns of the risk. Historically, returns have been around 20 percent, now it’s more 10 to 15 percent. There are simply no exits, it’s illiquid,” said Bengston.
For entrepreneurs, a smaller venture capital industry means that the little money available for funding is now going to be much harder to get!
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In A Slow M&A Market, Companies Like ShotSpotter Make Discriminating Buyers
April 20, 2009It is no secret that many venture-backed startups would give their first-born children to be acquired.
That’s because the alternative is bleak. VCs are handing out cash slower than they have in a decade, and many companies without suitors are forced to close their doors.
"People approach us monthly, if not weekly," looking to get acquired, says James Beldock
Unfortunately for many of these partner-hungry startups, the deal flow also is at a low. In the first quarter, only 68 venture-backed companies were sold, down 35 percent from 104 a year earlier.
That makes ShotSpotter’s deal announced Tuesday all the more worth looking at. ShotSpotter announced the acquisition of Planning Systems, a unit of QinetiQ North America, for an undisclosed amount.
“People do approach us monthly, if not weekly,” says James Beldock, CEO of ShotSpotter, referring to the stream of startups eager to sell themselves.
But instead of a deal simply to increase the company’s size, Beldock settled on a merger with hands-down strategic value.
ShotSpotter sells technology that enables police departments in cities around the country to pinpoint the location of gunshots. It uses sensors, as many as 20 per square mile, to continuously monitor troubled areas.
Planning Systems makes a similar technology for military and defense markets. And it has key sensor patents.
“It clearly is a buyer’s market,” says Beldock. And that buyer is more discriminating than ever.
1 Comment | hardware, news, startups, venture capital | Tagged: Mergers, ShotSpotter, startups, venture capital | Permalink
Posted by Mark Boslet
Venture Investing Collapses In The First Quarter
April 18, 2009The plummeting economy put a hold on venture activity in the first quarter, a pair of studies show.
U.S. venture capitalists invested only $3.9 billion during the period, down 50 percent from a year ago, according to one of the studies from Dow Jones VentureSource. It was the lowest quarterly total in a decade – from before the burst of the dot-com bubble.
Decline in venture activity accelerates. Source: Dow Jones VentureSource
A similar study from the National Venture Capital Association, PricewaterhouseCoopers and Thomson Reuters found that only 549 deals were signed, a plunge of 37 percent. Every major industry sector saw double-digit declines in activity, the firms said.
The surveys confirm what venture capitalists have been saying for months, that they industry has essentially ground to halt.
“Venture capitalists have slowed their investment pace in order to work with existing companies that are not able to exit the venture portfolio due to the shuttered IPO window and the weakening acquisitions market,” said Mark Heesen, president of the NVCA. “While this drop in investment is significant, we are not forecasting levels to continue to fall further. We would expect a mild and steady increase in investment throughout the rest of the year.”
No industry was immune to the fall off. Investments were down 42 percent software startups, 46 percent, in biotechnology companies and 31 percent in Internet businesses.
Even trendy clean-tech saw a plunge. Investments of $154 million put into 33 deals fell 84 percent.
A large share of the money spent during the quarter went to established portfolio companies. Late-stage deals accounted for 55 percent of the total, compared with 47 percent a year ago, said VentureSource.
Seed and first-round companies received just 18 percent compared with a quarter of all funding last year.
California dominated the spending, with 47 percent of the nation’s total.
Leave a Comment » | economy, news, startups, venture capital | Tagged: Dow Jones VentureSource, Downturn, First Quarter, Investments, National Venture Capital Association, PricewaterhouseCoopers, startups, Thomson Reuters, venture capital | Permalink
Posted by Mark Boslet
