Entries Tagged as 'VC'

The Funded reveals term sheets

I Posted on The Funded in 2007 shortly after initial launch. The company that lets entrepreneurs rate VC’s based on their various experiences has yet again raised the ante. The new service from The Funded will allow entrepreneurs access to the elusive term sheet. If you are unfamiliar with a term sheet check out three of my favorite resources that every serial entrepreneur should have bookmarked StartupLawyerBlog, Nivi’s blog and Venturehacks. (Be sure to check out the term sheet hack section).

Most entrepreneurs get lost in the application of terms like liquidation, conversion, redemption rights and anti-dilution (all found on a term sheet). Now the new beta program will now arm entrepreneurs with the most powerful weapon of all –real world knowledge and first-hand experience on what terms are common place and which ones are abusive. This is a boon for entrepreneurs as standardization of the term sheet is inevitable. According to VentureBeat The Funded will require a $250.00 a year subscription to access this information (well worth it!).

Stay tuned, because the P2P funding feature in SA 2.0 will utilize a similar approach. (Now you know what is taking so long to get version 2.0 out the door).

Tags: VC by Startup Addict

MySQL sold for $1 billion dollars

MySQL sold for $1 billion big ones…this is huge news. 2008 is officially the year of open source. The open source database startup MySQL was acquired by Sun Microsystems for $1 billion. MySQL was originally funded $39 million from Benchmark, Index, IVP, Intel, and SAP.

TechCrunch stated:

Startups with similar business models - managing a free open source project and bolting for-pay services on as a business model, will be happy to see this. Wordpress and OpenAds are two that we follow closely.

This news comes on the heels of Drupal founder Dries starting Acquia armed with $7 million in VC funding in a Series A financing led by North Bridge Venture Partners, with Sigma Partners and O’Reilly AlphaTech Ventures. VC’s are flocking to fund startups that will feed services to a growing user base in open source.

It crazy two of the most potent open source ingredients in SA 2.0 are already heading mainstream in a flurry of pay-service business models. Check out the ingredients in the Startup Addict platform:

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Just like the successful trend Red Hat procured through linux. Sun is now the Red Hat of MySQL and Acquira is the Red Hat of Drupal. “Life is good”….lets hope the services make “Life better”.

Tags: VC by Startup Addict

First Quarter VC investment strong

The Top six industries according to VCdeal

Internet 39 fundings with average amount of 7.5M

Software 32 fundings with average amount of 9M

Pharmaceuticals 26 fundings with average amount of 31M

Medical Devices 24 fundings with average amount of 15.6M

Biotech 19 fundings with average amount of 21M

Media 18 fundings with average amount of 18M

Internet, software and media should be no surprise based on the feeding frenzy of M&A in those related sectors for content. California, Massachusetts and New York among the top three states respectively. Startup Addict has an interesting feature on the home page called “Top Startup Industries” which depicts which industries are getting the most attention, funding and requests across the entire startup social network. It will be interesting to see how some of the smaller investments and angel funding match up with the larger VC industry statistics above. Throwing out a wild guess, I suspect Internet, software and media would be the Top 3 with the bootstrapping and seed crowd in the current startup climate.

Tags: VC by Startup Addict

CBS proves Bubble 2.0 may exist.

CBS forks out $5 million big ones for Wallstrip according to reports from jossip. Wallstrip is a humorous take on Wall Street and sustained an original investment of 500K from Union Square Ventures (Fred Wilson). One has to wonder as Techcrunch poignantly mentions why would CBS pay so much dough for a company that makes absolutely zip in revenue. Do you think CBS is getting caught up in the online media frenzy of M&As currently happening in the web 2.0 space?

On the other hand it may be too early to throw CBS under the bus. They obviously have a road map (one would hope) for this web property. At least it sets a precedent on valuation for entrepreneurs like us. A zero revenue generating web property targeting a very niche market can go for 5 Mill. Sounds good to me.

Tags: VC by Startup Addict

The Funded. VCs feel Entrepreneurs pain.

I came across my new favorite VC site “The Funded” this morning and was dying to blog about it. The site allows entrepreneurs to rate and review their experiences with Venture Capital firms and individual VCs. Some of the comments are down right appalling while some are laugh-out-loud funny. Either way a simple yet compelling site for both parties to frequent whether friend or foe.

Michael Arrington from TechCrunch makes a good point stating the vast majority of startups are rejected from VC, therefore a tendency for more negative feedback to prevail persists rather than positive. On the other hand it also shows the true underbelly of a closed door community. The Funded has decent coverage on the national VC firms and funds they manage. Beside adding famous insight it allows a startup to gauge the temperament of different VC firms based on the originating startup concept or idea. This is one going in my blogroll for sure.

Tags: VC by Startup Addict

VCs start to feel the cold shoulder

For the last decade VCs have been the most coveted “old-boys club” for the money-thirsty entrepreneur. They represent the holy grail of funding and the glimpse of success. Unfortunately, once a pioneer leaves 4 quarts of blood on the alter, 60% of the startup equity is vanquished.

Today venture captial continues to rise, yet the cost of getting a startup off the ground is trending down (at least for most startups). Angels and the more adaptable VCs (CRV and YCombinator) are jumping in with beta-testing money broken among many, many startups. Old School was large sums of money among fewer startups. Finding the next Google or Myspace is becoming exceedingly difficult in the crowded Web 2.0 space. According to the University of New Hampshire 2006 angel funding comprised of over $25 billion of the startup pie.

Micro-venture capitalists, informal private investing and peer-to-peer funding (like Startup Addict) will continue to lead this new paradigm. Determing if a startup is a failure or success before $3 million dollars in investment is evaporated. This is as beneficial for the entrepreneur as it is for the the investor. Gone are the days of million-dollar a month burn rates….sooo get down to business and then do it again.

Tags: VC by Startup Addict