Venture Capital

Richard Florida continues to write amazing stuff about Startup Communities in The Atlantic Online. Two of his latest articles talk about entrepreneurial density and venture capital. High-Tech Challengers to Silicon Valley The Connection Between Venture Capital and Diverse, Dense Communities For a long time I’ve suggested that an interesting measure of entrepreneurial density would be ((entrepreneurs + employees of startups) / total population). I asserted in my book Startup Communities: Building an Entrepreneurial Ecosystem in Your City that I thought Boulder had the highest entrepreneurial density in the world. I qualified this by staying I had no real empirical data – it was merely an assertion based on my experience. ...

Last night Amy and I watched the movie Something Ventured: Risk, Reward, and the Original Venture Capitalists. This was my reward (I got to choose) since she watched both football games yesterday (and today). We have a 15 minute and 30 minute rule on any movie – after 15 minutes the chooser asks “still into this movie?” If the answer is no, we stop. This question gets asked by the chooser again after 30 minutes. If the answer is yes, we go for the duration, even if someone falls asleep. For example, after 15 minutes the other day, Amy said “still in” on my choice of The Hebrew Hammer . After 30 minutes, we were both “no’s” and that was the end of that. ...

Last night Amy and I had an awesome dinner at Perla with Fred Wilson , Joanne Wilson , Matt Blumberg , and Mariquita Blumberg. Fred and I have been involved in Return Path for a dozen years and this has become an annual tradition for us when Amy and I are in NYC. At 12 years of service, Return Path gives a six week sabbatical and a pair of red Addidas sneakers as a “get ready for your sabbatical” gift. Fred and I got the sneakers, but not the six week sabbatical. ...

I spent most of the day yesterday at TechStars Boulder. Demo Day is a week away and I did my annual “talk about how to finance your company” thing which included meeting with each company and giving them advice on where they were in the process. As I walked to dinner, I felt incredibly energized – once again there is a great set of companies coming out of the program and it’s awesome to reflect on the progress that they’ve made in 90 days. ...

We describe Foundry Group ‘s behavior as “syndication agnostic.” When we make an investment, we are completely agnostic as to whether or not we have a co-investor. This is true at early stages but also true at later stages. We make our own decisions to invest, or not to invest, independent of what other investors are thinking. As part of this philosophy, we’ll lead follow-on rounds for companies we’ve already invested in, including those making great progress where we will lead an up round that we price. We aren’t looking for outside validation from other investors of any sort – either positive or negative. Because we are syndication agnostic, we are delighted to work with great co-investors and welcome and encourage the interaction and partnership. But we don’t have any dependency on it for our decision making. ...

Yesterday I sent emails out passing on participating in two seed rounds for companies I really like. They had lots of investors trying to invest and each company was competitive with two other seed stage companies we’ve seen in the past 30 days. All are exciting, all are working on something that we like, and all of them are at the starting line with different strengths and weaknesses. ...

In the fall of 2010 Mahendra Ramsinghani reached out to me by email about a new book he was working on called The Business of Venture Capital: Insights from Leading Practitioners on the Art of Raising a Fund, Deal Structuring, Value Creation, and Exit Strategies. He asked for two things: (1) some of my time for him to interview me and (2) intros to other VCs and LPs. I made a pile of intros and didn’t think much more of it. ...

As a VC who has been blogging for a long time I’ve been fascinated by the VC Blogger phenomenon. I’ve been subscribing to, reading, forwarding, occasionally commenting, and setting up networks of feeds for a while. With the relaunch of AsktheVC we’ve resurrected something we used to do periodically which is highlight a great VC post. However, we are taking a different tact this time around with our new motto. ...

On my run today I was thinking about GP – LP interactions. This line of thought was prompted by a contrast between two interactions, or rather one interaction and one non-interaction, that I’ve had in the past few days. The interaction was I had with one of my LPs over the last 24 hours. They emailed asking for a reference on someone who indicated they knew me and had invested with me. I didn’t know the person, but knew a few people who did, and quickly sent emails getting addition info for my LP. With a small amount of effort I was able to generate some useful feedback, including triangulating on the deal he was suggesting we were investors in together (it was a true statement prospectively as it’s something I’m working on.) I was also able to get some specific one degree of separation feedback for my LP. ...

Over the past 24 months, a deplorable activity in the money management business came to light. It got the name “pay to play” but was just another form of bribery. The common description of pay to play is “the practice of making campaign contributions and related payments to elected officials in order to influence the awarding of lucrative contracts for the management of public pension plan assets and similar government investment accounts. ” Yup – sounds like bribery to me. ...