Blog Archives

Welcome Stephanie Palmeri, the gal I meant to dissuade taking a job in venture… and ended up hiring

We’re super excited to announce that Stephanie (“Steph”) Palmeri has joined SoftTech VC as Senior Associate, a brand new position in our firm which has grown 400% since January 1st. Steph is awesome: smart, workhorse, funny, New-Yorker, swear-proof, determined, Columbia MBA – in no particular order. And we can truly say that serendipity is responsible for that lucky find for us.

If you follow me on Twitter/Google+, you might recall a post I wrote a couple of months ago (which generated a lot of great comments):

A very smart MBA (who just graduated) wrote me asking if there was a job opportunity at SoftTech VC. She really wants a job in venture apparently, which I can respect, but I really think that venture (aka “the dark side”) is a gig you do after accumulating operating experience. Here is what I wrote her:

“In any case, I don’t think that we … Read more »


My personal “Panel Pile Up” Etiquette

My friend Fred Wilson wrote a post this morning about the looong queues of people speakers face after panels or talks we give at conferences: The Panel Pile-Up. This post is actually an edit of the comment I left on Fred's blog.

I am speaking at one or two events a week, and I am seeing that pile-up all the time. It takes me anywhere from 10 to 40 mins to get off stage or "free myself up". Once it took me over an hour to leave the room – at a TiE Conference a couple of years ago.

I consider it part of the job to meet people in the hallway, and so I try to be as efficient but gracious as possible. A sixty second pitch, a couple of short Q&As followed by "Can we continue the discussion by email?" are fine since I will typically be able to indicate whether I am interested in following up, … Read more »


Trends in Venture Financing – 2Q06 Data

The 2Q06 compilation produced by Fenwick and West regarding vc financing trends in Silcon Valley has just been released, and it continues to show strength in activity and valuation. The most notable point, which needs to be confirmed in the next couple of quarters to really be meaningful, is that valuations have grown by a lower factor than in Q106 and Q405. Other data points listed in the report (statistics are provided by Dow Jones VentureOne):

The Fenwick & West Venture Capital Barometer™ showed a 34% average price increase for Silicon Valley companies receiving venture capital in 2Q06 compared to such companies’ previous financing round. Although this was a significant increase, it was less of an increase than in the prior four quarters. The amount invested by venture capitalists in the U.S. in 2Q06 was approximately $6.7 billion, an increase over $6.4 billion in 2Q05 and $6.2 billion in 1Q06. The combined total of $12.9 billion for … Read more »


Congratulations to Netvibes on their $15M raise

I am late to it (been busy with the aftermath of my own news) but I have to congratulate my friends Tariq Krim, Pierre Chappaz and Freddy Mini for closing Netvibes’ Series B of 12M EUR (or $15M). Per TechCrunch:

NetVibes, a Paris/London based company, will announce a $15 million round of financing on Monday. Existing investor Index Ventures joined new investor Accel to lead the investment, which is one of the largest this year for a European company. The valuation was not disclosed.

I missed the angel financing round that involved Index Ventures, Pierre, Marc Andreessen and Martin Varsavsky but Tariq has since asked me to join his advisory board. The growth of Netvibes in users and traffic has been stunning, and I am delighted to be involved in helping build the company.

Actually, Freddy – the COO and future expat in the Valley to build the co’s business in the US –  is … Read more »


AOL acquires Userplane to expand AIM network

A brief interruption of my holiday schedule to announce a great news: portfolio co Userplane has been acquired by AOL LLC a couple of weeks ago, and I just heard that the official press release is now up there. I started working with the three founders of the company, Mike Jones, Nate Thelen and Jave Hall, over a year ago, and it is really with delight that I am congratulating them, and the whole team, for such a great outcome (that I will not give any detail about, as AOL has elected not to disclose any financial information about the deal). So let’s just say: a great outcome for all involved.

Userplane is in the business of powering online communities with a suite of communication tools: Instant Messaging, Chat rooms, A/V Recorder – on a white label basis. The original model was to license these tools to very large social networking and dating sites (MySpace, Friendster, Date.com,…), … Read more »


Investment of the day: Mashery

Busy week: another of my recent investments was announced this morning. I have joined First Round Capital’s Josh Kopelman and my Search SIG co-chair Dave Mc Clure as founding investor of Mashery, Inc., a software infrastructure startup. We will actually not disclose much more than what Oren Michels, the CEO, has mentioned on his blog– but the company is essentially developing a much needed piece of functionality of the web services and mashups economy.

Our Mashery will be a resource for developers, API providers and mashup users. Over the next six months, we will release a range of services that will make it easier to develop, deploy and use mashups and other “user generated services”

I am excited to work with Oren again, who was the VP of Business Development of Feedster – of which Josh, Dave and I all were Angel investors.

Just to clarify by the way: it just so happens that four … Read more »


Two new investments: Rapleaf and Wikio

I was meant to mention it much earlier but last week went by so fast! I have joined the investors syndicate behind the Series A of Rapleaf, the startup headed by my friend Auren Hoffman. Rapleaf is looking at developing a comprehensive portable reputation system for Internet communication and commerce – a major piece of infrastructure that is yet to be built, and I am excited to be involved in that project. Matt Marshall has more about the funding, and the TechCrunch review is here.

Another investment that just closed (yes, I have done quite a few recently – more to be announced) is the initial round of financing of Wikio, a European startup that has developed a news search engine bringing together a number of functionality included in Google News, Topix.net, Digg and Memeorandum. I had written about it when the service entered a closed beta (and before I investigated a potential investment). It … Read more »


Trends in Venture Financing – Q106 Data

I wrote a year ago about the compilation that law firm Fenwick & West produces every quarter of the venture financing terms received by a sample of companies in the Bay Area. The Q106 data report essentially shows a strong support in financing across stages, with a total $6B invested during the quarters, and increasing valuation “”step-ups” from one round to the next:

The Fenwick & West Venture Capital Barometer showed a 64% average price increase for companies receiving venture capital in 1Q06 compared to such companies’ previous financing round.  This was also the largest increase since the survey began.

What the report does not show is an increase in valuations asked by entrepreneurs for their initial round of financing, especially in last three months. Event at seed stage, it is not uncommon these days to hear about high single digit pre-money ($5M to $8M) which is – at least in the areas in which I invest – becoming pretty expensive. 

Terms are also increasingly entrepreneur … Read more »


Microsoft VC Summit 2006: On Microsoft’s startup acquisitions

During his remarks (which I will blog when I have a bit more time), Steve Ballmer made it clear that Microsoft will continue being acquisitive, at an accelerated pace, with a price sweet spot between $30M and $200M. Of particular note was the fact that 1/3 of acquired startups are not VC-backed, just bootstrapped or angel-backed.

I found Don Dodge’s very useful post in my trackback log, in which he lists Microsoft’s most recent startup acquisitions and provides some background on the strategy:

VCs are always interested in Microsoft’s acquisition activity and direction. Over the past 12 months Microsoft has made 22 acquisitions totaling nearly $1B. This compares to just 9 acquisitions the previous year. […] Acquisitions are typically made for three reasons;

People – acquiring great engineering teams and operating managers Technology – adding a technology to an existing product set Time to market – sometimes the market moves faster than Microsoft can release a product. Security is an example. Sometimes … Read more »


“Israeli VC on Sand Hill road” is her blog

And Tali Aben is her name.

I was very happy to see that my good friend Tali just joined the ranks of the VC bloggers, and be the first VC blogher in a long time – which is great. Tali is a General Partner at Gemini Israel Funds – a Tier 1 Isreali firm, and is based in Silicon Valley. You will no doubt find her experience of helping Israeli portfolio companies interesting, and her wit and frank style enjoyable.

As she puts it in her first post:

I suppose, there’s a first time for everything…. and it’s high time to get this blog started. I’ll start by saying what it is I’ll be blogging about:

* Issues facing Israeli startups * Raising 3 boys (ages 2,8 and 12) * Professional women * Digital Photography

I suppose that will keep me busy for awhile….. stay tuned.

Welcome Tali. … Read more »


Venture Investment Statistics 2005

Buddy Will Price has the Venture Investment Statistics for 2005, from VentureSource, a division of Dow Jones and Ernst & Young.

Commitments to VC Funds, $22.2 bn. Up 18.7% from 2004 VC Financings, $22.1bn. Up 2.8% from 2004 IT Financings, $12 bn. Down 4% form 2004 Software Financings, $5.11bn, Down 6% from 2004 Number of Active Firms, 1,417 Down 49% from 2000, 61% if you define active as > 4 deals per year. Number of exits, 397. IPOs: 41, down 38% from 2004, with $2.24bn raised via IPO M&A: 356, down 12% from 2004, with $27bn in total exit value Number of private companies funded since 2000 net of 2005 exits: 5,406 with $132bn invested in them Average of $24.4m invested in companies At current exit rate, will take 13.6 years to get through backlog (amount available to VC firms for investments / total investments per year) Median M&A exit $47.5m Median Pre-moneys (across sectors) Seed … Read more »


How about friends and family financing ?

Quite a bit of discussion took place in the comments and offline following my post on accredited investors, especially as it relates to friends and family financing. These investors will typically be “easier” to convince to support and finance your idea, but at the same time they might not qualify for the accreditation as defined by the law.

So what can you do as a young entrepreneur/team needing some cash? First order: can your savings and credit cards get you anywhere meaningful? Second: in order to avoid being stuck between a rock and a hard place, a loan that will be re-imbursed as opposed to converting into the next round of equity financing might be a temporary solution. Unfortunately for the unaccredited lender, he/she will not be able to benefit from that early support through the perks angels typically get: discount to Series A, warrant coverage, etc. because only accredited investors can acquire equity. And once … Read more »