Lawrence Aragon
Venture capital firms looking to juice their returns would do well to consider PIPEs in former portfolio companies that are now public.
As Joanna Glasner reports in this week’s Private Equity Week, venture firms have done at least four such deals in former VC-backed companies in the past few weeks (click her for free copy of the story). And PwC is predicting a surge in PIPEs this year. VCs that got in on the action early may have already benefited.
The Thomson Reuters Post-Venture Capital Index (PVCI)—which tracks the performance of public stocks of companies that previously raised money from VC and buyout firms—finally posted a gain in December after three consecutive months of losses. The PVCI rose 5.9% to 365.59 on Dec. 31
The global financial crisis has caused venture capitalists to dramatically reduce their deal making, according to preliminary data gathered by Thomson Reuters. (UPDATE: Full story from PE Week is pasted below.) Read the full story here in PE Week (it's free to everyone today).
The data show that U.S.-based venture firms invested in just 250 companies in October, down from 565 companies in September and 518 companies in October 2007. You have to go all the way back to January 2004 (when they invested in 232 companies) to find a lower number. The only other October with fewer deals was in 1993.
The amount of capital that VCs are investing also plummeted in October, when U.S.-based firms put $2.5 billion to work, down from $3.8 billion in September and $3.2 billion in October 2007. The October
If you’re thinking of raising a fund next year, think again. The downturn in the public markets has had a significant impact on limited partners, throwing their allocations out of whack, and there is growing anecdotal evidence that both venture and private equity firms are being affected. I was talking to a VC last night […]
The latest issue of Venture Capital Journal is out and I’ve got a free story for non-subscribers. Entitled “Project financiers now on speed dial,” the story looks at how cleantech companies have been squeezed by the economic downturn and credit crunch. A lot of these venture-backed companies, like solar companies and biofuel makers, need big investments to scale up. And they can’t go back to their VCs because – except for a handful of new cleantech growth funds – most venture firms just can’t write checks of that size.
This is where project financiers like John Buehler of Energy Investors Funds come in. After Buehler recently put $60 million into a $160 million debt and equity round for Solar Power Partners
Fred Dotzler, managing director of healthcare venture firm De Novo Ventures, asked that I share his open letter to Sen. John McCain. What do you think, peHUB readers? Agree? Disagree? To: John McCain From: Fred Dotzler John: I suggest you name Mitt Romney as your new Vice Presidential candidate. Mitt turned around the Salt Lake City Olympics, and remade Bain […]
Before Sequoia Capital gathered its portfolio companies this past Tuesday to give them advice about the current economic unpleasantness, Benchmark Capital sent the following advice the prior week to the CEOs and CFOs of its portfolio companies. In sharing the memo with us, General Partner Bill Gurley notes: that it "was intended to be low key. We werent trying to create coverage." He adds: "We are not under our desk. We believe that there is tremendous opportunity that arises in situations like this. As a result we (a) want for our current investments to re-optimize around the new reality, and (b) will be very active in pursuing new deals/opportunities."
That said, here's the memo: Benchmark September 2008 Perspective
A lot of advice is being offered up by VCs to their portfolio companies about how to deal with the current financial crisis -- from Sequoia Capital to Ron Conway to Promod Haque. Well, here's some advice for venture firms themselves.
It may sound like it was written today, but peHUB Editor Dan Primack actually wrote it back in May 2002. Give it a gander and let us know if you think it's still on the money. Also, let us know if you'd add anything to the list.
With the Dow in free fall, venture capitalists apparently are coming to grips with reality. Om Malik is reporting that Sequoia Capital this week brought in a bunch of its startups CEOs to let them know they need to batten down the hatches. It was only 2 1/2 weeks ago that VCJ did a survey of VCs and found that […]
If you thought the venture industry was insulated from the ups and downs of Wall Street, think again. I just ran the numbers for the Thomson Reuters Post-Venture Capital Index (PVCI), and they’re the worst they’ve been since September 2001. The PVCI plummeted 19% to 511.78 for the month ended Sept. 30, down from 631.85 on Aug. […]
The UK’s TimesOnline is reporting: “Corporate India is in shock after a mob of sacked workers bludgeoned to death the chief executive who had dismissed them from a factory in a suburb of Delhi. Lalit Kishore Choudhary, 47, the head of the Indian operations of Graziano Transmissioni, an Italian-headquartered manufacturer of car parts, died of […]