Opinion

This past summer we surveyed over 1,000 venture capitalists, and asked them a simple yes or no question: “Is the Venture Capital Business Broken?" Over 53% of the respondents said “yes." This triggered a lot of conversation in the blogosphere and in the VC community. It got me thinking about what exactly is going on and made me want to do a deeper dive. As a result, late in the fourth quarter I reached out to 50 general partners of venture funds across the country in Silicon Valley, Austin, Dallas, Tysons Corner, New York and Boston to gauge their sentiments about the state of the venture business. Not surprisingly, a wide-range of insights and comments resulted from those conversations. I started those dicussions by asking: “How does the venture business look on January 1, 2010, when the industry can no longer drag around the 1999 returns in a trailing 10 year average?” The best response I received was that on that date that the industry would go to a 12-year trailing average!

I confess to being a Shrek fan. My kids made me (well, sort of) buy the music CD to Shrek 2 and my favorite song on that CD is the Jennifer Saunders song – Holding Out For A Hero. When they were little we would play it over and over again in the car. I […]

For decades, the venture capital industry was like a Yale Secret Society - very clubby, discrete and opaque. VCs had all the power in the VC-entrepreneur equation, and entrepreneurs had to work hard to decode the mysterious VC process to obtain funding. My how the world has changed in a few short years. Pundits will tell you that in terms of trends, 2009 was the year of the real-time Web/Twitter, smart phones/iPhone and the mainstream emergence of digital advertising. But 2009 was also the year VCs blogging and tweeting really became mainstream.

Finally saw Avatar over the holidays, and James Cameron has done it again. I can definitely see it winning the Oscar for Best Picture. But now that 2009 has ended, it’s time to make some real Oscar predictions for the all of the best movies of the past year. So, here is my list of the Best Movies of 2009, Venture Capital (VC) style:

He who loses less, wins? Venture capital in the 2000s was much akin to the joke about the two campers who cross paths with a bear. As the angry bear begins charging out of the woods towards the campers, the first camper starts putting his sneakers on. The other camper screams, "It's no use, we'll never be able to outrun the bear!" And the first camper yells back, "I don't need to outrun the bear, I just need to outrun you!" Over the past decade, venture capitalists could claim top-quartile performance just by showing smaller losses than the rest of the pack. The start of 2010 provides a clean slate—that is, after we break out the scorecard and grade last year’s predictions.

The carried interest debate has kicked into high gear, with legislation currently under consideration that could tax carried interest as ordinary income. Much of the conversation relates to the incentives or disincentives this would create or whether it is advisable. On that front alone, our view is that it’s a bad idea. Risk takers and […]

Glimmers of light are breaking through on the dark and cloudy financial horizon, and investors across the country – and around the world – are starting to hope that an economic dawn has finally arrived. But despite the bright patches, it’s unclear whether the global markets will loosen and open enough to start generating meaningful […]

A recent study by the NVCA and Dow Jones VentureSource reveals valuable metrics on VC board behavior, composition and dynamics. In the area of board conflict, one observation from the study begs to be discussed further in the context of the current operating environment: A suggestion that there is strong agreement between VCs and CEOs […]

Written for VC-backed entrepreneurs... Congratulations! Today is your day. You’re off to Great Places! You’re off and away! Oh, the Mistakes You Will Make, The Money you’ll Waste Maybe Your are Moving With much too much haste!