Comments for From Angel to Private Equity http://tristateventuresblog.com Spanning the World of Private Investing. Sat, 30 Aug 2008 11:06:14 +0000 http://wordpress.org/?v=2.2.1 Comment on The Hulu Dance by Kevin http://tristateventuresblog.com/2008/05/21/the-hulu-dance/#comment-345 Kevin Thu, 22 May 2008 17:27:48 +0000 http://tristateventuresblog.com/2008/05/21/the-hulu-dance/#comment-345 Great post. We love Hulu too. We reposted your comments on our blog for the New Media Tastemakers Summit (http://www.NewMediaTastemakers.com) Great post. We love Hulu too.

We reposted your comments on our blog for the New Media Tastemakers Summit (http://www.NewMediaTastemakers.com)

]]> Comment on Microsoft/Facebook worse then AOL/Time Warner by RIchie http://tristateventuresblog.com/2007/10/25/microsoft-facebook-aoltime-warner/#comment-124 RIchie Sat, 29 Dec 2007 05:13:57 +0000 http://tristateventuresblog.com/2007/10/25/microsoft-facebook-aoltime-warner/#comment-124 No social network has been able to surpass the $3/user/year mark. Facebook has a shot at it though, they need to do a lot of work and I think could double it to $6 per user per year. Myspace i believe is around $5/user/year now. It takes years and luck to go beyond $3. I don't know why but that's been the magic number. And that's in a popular network, smaller networks generate less revenue. Myspace was at $3/user/year in revenue when they were acquired. Facebook's value is users actually like being on facebook. Facebook needs a social search engine and email platform though. No social network has been able to surpass the $3/user/year mark. Facebook has a shot at it though, they need to do a lot of work and I think could double it to $6 per user per year. Myspace i believe is around $5/user/year now. It takes years and luck to go beyond $3. I don’t know why but that’s been the magic number. And that’s in a popular network, smaller networks generate less revenue. Myspace was at $3/user/year in revenue when they were acquired. Facebook’s value is users actually like being on facebook. Facebook needs a social search engine and email platform though.

]]> Comment on Back to Blogging. by RIchie http://tristateventuresblog.com/2007/12/02/back-to-blogging/#comment-78 RIchie Wed, 12 Dec 2007 18:55:07 +0000 http://tristateventuresblog.com/2007/12/02/back-to-blogging/#comment-78 whats the legal services biz? whats the legal services biz?

]]> Comment on What will save the market ? by admin http://tristateventuresblog.com/2007/11/07/what-will-save-the-market/#comment-37 admin Thu, 22 Nov 2007 05:08:41 +0000 http://tristateventuresblog.com/2007/11/07/what-will-save-the-market/#comment-37 firstly, to say that you are getting 41% more in stocks based on yield is like saying Junk Bonds return 50% more ( or whatever the number is) then AA rated bonds ( besides Mortgage backed ones of course:) ) Secondly, I would be curious if you can show more of the insider buying details- because that indeed is surprising- I think it is important to break down that data in correlation with stock high and lows on the specific transactions. Thirdly, if the Fed lowers ( which they have indicated they would not in general) that of course will drive the market up- I remain concerned that they wont. As of Nov 2nd thedow stood at 13595- Today we are at 12799 - I think we are at the tip of the iceberg. Remember, the private equity market credit based slowdown will begin to kick in as well. lets see what happens. firstly, to say that you are getting 41% more in stocks based on yield is like saying Junk Bonds return 50% more ( or whatever the number is) then AA rated bonds ( besides Mortgage backed ones of course:) )
Secondly, I would be curious if you can show more of the insider buying details- because that indeed is surprising- I think it is important to break down that data in correlation with stock high and lows on the specific transactions.
Thirdly, if the Fed lowers ( which they have indicated they would not in general) that of course will drive the market up- I remain concerned that they wont.
As of Nov 2nd thedow stood at 13595- Today we are at 12799 - I think we are at the tip of the iceberg.
Remember, the private equity market credit based slowdown will begin to kick in as well. lets see what happens.

]]> Comment on What will save the market ? by chrstopher higgins http://tristateventuresblog.com/2007/11/07/what-will-save-the-market/#comment-27 chrstopher higgins Fri, 16 Nov 2007 17:48:39 +0000 http://tristateventuresblog.com/2007/11/07/what-will-save-the-market/#comment-27 With a 10 year yield at 4.16% and the S&P earnings yield at 7.05% it is clear you are getting 41% more in stocks hence the market will go up regardless of the doomsayers which is almost everyone. Sentiment is quite bearish. Insiders are buying at a ratio of 13 to 1. Anything under 20-1 is bullish. Ecports are growing twice as fast as imports which takes a billion off our trade deficit almost every month. We should and I believe the Fed will take fed Funds to or below 3 1/2% which will spark our domsetic recession into fast growth again which would trigger a dollar rally and short covering of the USD. It is important to note that the average Dow return after 12 months of lowering rates ha been around 19% and gold and the CRB have dropped by 6% and the dollar has rallied by almost 6% Forward PE's are 14.70, lower than the 1987,1998 and 2002 market bottoms. next year the level 3 debt will be repriced higher than today and the EPS on the battered financials will explode up. With a 10 year yield at 4.16% and the S&P earnings yield at 7.05% it is clear you are getting 41% more in stocks hence the market will go up regardless of the doomsayers which is almost everyone. Sentiment is quite bearish. Insiders are buying at a ratio of 13 to 1. Anything under 20-1 is bullish. Ecports are growing twice as fast as imports which takes a billion off our trade deficit almost every month. We should and I believe the Fed will take fed Funds to or below 3 1/2% which will spark our domsetic recession into fast growth again which would trigger a dollar rally and short covering of the USD. It is important to note that the average Dow return after 12 months of lowering rates ha been around 19% and gold and the CRB have dropped by 6% and the dollar has rallied by almost 6%
Forward PE’s are 14.70, lower than the 1987,1998 and 2002 market bottoms. next year the level 3 debt will be repriced higher than today and the EPS on the battered financials will explode up.

]]> Comment on The Facebook has no Face…… by Peter Verkooijen http://tristateventuresblog.com/2007/11/03/facebook-disaster/#comment-24 Peter Verkooijen Sun, 11 Nov 2007 17:08:24 +0000 http://tristateventuresblog.com/2007/11/03/facebook-disaster/#comment-24 Microsoft bought a top position in "social advertising" and a little street cred for as long as it lasts. They got all they need out of Facebook for a decent price. Microsoft is not going to buy Facebook. Nobody's going to buy Facebook at this valuation. Microsoft won, Facebook lost. Facebook is over the hill, as I've argued <a href="http://web2newyork.com/blog/2007/10/23/time-to-abandon-the-facebook-ship/" rel="nofollow">here</a>. Also read <a href="http://www.roughtype.com/archives/2007/11/the_social_graf_1.php" rel="nofollow">this blistering post</a> from Nicholas Carr. Microsoft bought a top position in “social advertising” and a little street cred for as long as it lasts. They got all they need out of Facebook for a decent price.

Microsoft is not going to buy Facebook. Nobody’s going to buy Facebook at this valuation. Microsoft won, Facebook lost.

Facebook is over the hill, as I’ve argued here.

Also read this blistering post from Nicholas Carr.

]]> Comment on The Facebook has no Face…… by eric http://tristateventuresblog.com/2007/11/03/facebook-disaster/#comment-21 eric Sat, 10 Nov 2007 01:25:05 +0000 http://tristateventuresblog.com/2007/11/03/facebook-disaster/#comment-21 Regardless of the amount of users, all it takes is one company to come out with a better network. A good example, Google wasn't the first search engine, AltaVista, Lycos, Excite, Hotbot, AskJeeves, Yahoo, and Looksmart all were released before Google, and Google has more users than all of them combined. Now, more interestingly enough, there are people out there who believe they can make a better search engine than Google, and more interestingly enough, this holds true for a social networking site. There are people working on things now, who believe millions of users on any site can, and will switch to the next best site. No user has a contract to stay on any free site, and likewise they can leave at will. Read Steve Rubel's blog on the transient Web, and you'll see his hypothesis. http://www.micropersuasion.com/2006/04/the_transient_w.html I truly believe in the transient Web, and there is always the next best thing. What happens, users hit a plateau, and they stick with something, yet there is proof that users have yet to become 100% loyal with social networks, although there is at least one site I know of that I believe will certainly push the envelope, and give 50 million users a something new to enjoy. Regardless of the amount of users, all it takes is one company to come out with a better network. A good example, Google wasn’t the first search engine, AltaVista, Lycos, Excite, Hotbot, AskJeeves, Yahoo, and Looksmart all were released before Google, and Google has more users than all of them combined. Now, more interestingly enough, there are people out there who believe they can make a better search engine than Google, and more interestingly enough, this holds true for a social networking site. There are people working on things now, who believe millions of users on any site can, and will switch to the next best site. No user has a contract to stay on any free site, and likewise they can leave at will. Read Steve Rubel’s blog on the transient Web, and you’ll see his hypothesis.

http://www.micropersuasion.com/2006/04/the_transient_w.html

I truly believe in the transient Web, and there is always the next best thing. What happens, users hit a plateau, and they stick with something, yet there is proof that users have yet to become 100% loyal with social networks, although there is at least one site I know of that I believe will certainly push the envelope, and give 50 million users a something new to enjoy.

]]> Comment on Corporate Venture Capital- Bad News by admin http://tristateventuresblog.com/2007/09/25/corporate-venture-capital-bad-news/#comment-19 admin Wed, 07 Nov 2007 19:08:52 +0000 http://tristateventuresblog.com/2007/09/25/corporate-venture-capital-bad-news/#comment-19 Adam- I dont disagree that startegic investors are very useful either as a VC or as a direct investment-Just ask one of my favorite companyies: Facebook. I agree that both from the investee company perspective and the investors already in a company, a strategic investors is usually an excellent thing ( there are exceptions of course). Besides for the obvious tangible benefits, at the very least it almost always provides a significant valuation uptick and makes everyone feel happy- maybe even a celebration party. . The point that I was making is that generally speaking the CVCs are slow to move in and very quick to move out and seem to have perfect bad timing. Their reentry into the VC market makes me concerned that this is a signal of a market top for the VC market. In addition CVC have a tendancy to pay higher valuations because of the inherent strategic value. This caused their losses to be further magnified. So when things start to look bad they are quick to pull the trigger. To a certain extent they are similiar to the retail investors in a frothy market. I do agree that it it important that they partner with someone like yourself who can help them avoid those errors and build a viable long term program. With the right partner and a serious true long term commitment which doesnt change with the wind, they can have a big edge on the traditional limited life fund VC. Adam- I dont disagree that startegic investors are very useful either as a VC or as a direct investment-Just ask one of my favorite companyies: Facebook. I agree that both from the investee company perspective and the investors already in a company, a strategic investors is usually an excellent thing ( there are exceptions of course). Besides for the obvious tangible benefits, at the very least it almost always provides a significant valuation uptick and makes everyone feel happy- maybe even a celebration party. .
The point that I was making is that generally speaking the CVCs are slow to move in and very quick to move out and seem to have perfect bad timing. Their reentry into the VC market makes me concerned that this is a signal of a market top for the VC market. In addition CVC have a tendancy to pay higher valuations because of the inherent strategic value. This caused their losses to be further magnified. So when things start to look bad they are quick to pull the trigger. To a certain extent they are similiar to the retail investors in a frothy market.
I do agree that it it important that they partner with someone like yourself who can help them avoid those errors and build a viable long term program. With the right partner and a serious true long term commitment which doesnt change with the wind, they can have a big edge on the traditional limited life fund VC.

]]> Comment on Corporate Venture Capital- Bad News by Adam Caper http://tristateventuresblog.com/2007/09/25/corporate-venture-capital-bad-news/#comment-18 Adam Caper Wed, 07 Nov 2007 18:42:33 +0000 http://tristateventuresblog.com/2007/09/25/corporate-venture-capital-bad-news/#comment-18 Although I obviously have a bias -- being, as I am, in the business of enabling CVC players -- it's far from clear to me how the claim "that is not really good news for everyone else" is supported in either the text of the article referenced or as a matter of inevitable fact. To be sure, CVC was practiced by many during the 90's in the same profligate, undisciplined manner that the rest of the industry was subject to during the bubble. But with Open Innovation having become accepted as a mainstream strategy for product development and the wholesale shift of technology commercialization dollars away from corporate R&D departments into the start-up environment, incumbents are seeing CVC as a healthy and positive way to bridge the chasm between entrepreneurial innovators and their own more well-developed ancillary capabilities. I'd respectfully suggest that thinking about strategic/CVC investors as development partners rather than gate-crashers would be more useful. Corporations are facing a lot of pressures that recommend partnering with the venture community to develop platforms into applications, test new products & emerging markets, and syndicate risky commercialization processes. From the entrepreneur's side, a well-crafted partnership with an incumbent can be a huge accelerant to growth and provide critical feedback from an interest party in place of a do or die first customer engagement. From the investors' perspective, a strategic can validate a product and provide an easy exit (if an acquisition makes sense) and even a hedge (if the portfolio company doesn't make it as a high-flyer and everybody just wants out at some point). While CVCs don't make sense for every deal -- and perhaps not even for most -- there are certain "use-cases" where the right strategic at the right time can be a huge advantage. If you doubt that, ponder this: according to PWC/Moneytree data, nearly 1/4 of all venture-backed firms have a strategic investor at some point in the cycle. While it's certainly true that not all work out the way everyone had hoped, it's also true that there's probably a horse in there somewhere. Given that, the task is to improve CVC processes and thereby more effectively bring corporate investors into tune with the way the venture business works. Unabashed plug: for anyone who wants to explore these ideas further, feel free to take a look at our website, www.synchronyvm.com. _________________________ Adam D. Caper, Managing Director Synchrony Venture Management 99 High Street, 7th Floor Boston, MA 02111 0/617.247.6300 x701 m/617.852.6054 acaper@synchronyvm.com www.synchronyvm.com _________________________ Adam D. Caper, Managing Director Synchrony Venture Management 99 High Street, 7th Floor Boston, MA 02111 0/617.247.6300 x701 m/617.852.6054 acaper@synchronyvm.com www.synchronyvm.com Although I obviously have a bias — being, as I am, in the business of enabling CVC players — it’s far from clear to me how the claim “that is not really good news for everyone else” is supported in either the text of the article referenced or as a matter of inevitable fact. To be sure, CVC was practiced by many during the 90’s in the same profligate, undisciplined manner that the rest of the industry was subject to during the bubble. But with Open Innovation having become accepted as a mainstream strategy for product development and the wholesale shift of technology commercialization dollars away from corporate R&D departments into the start-up environment, incumbents are seeing CVC as a healthy and positive way to bridge the chasm between entrepreneurial innovators and their own more well-developed ancillary capabilities.

I’d respectfully suggest that thinking about strategic/CVC investors as development partners rather than gate-crashers would be more useful. Corporations are facing a lot of pressures that recommend partnering with the venture community to develop platforms into applications, test new products & emerging markets, and syndicate risky commercialization processes. From the entrepreneur’s side, a well-crafted partnership with an incumbent can be a huge accelerant to growth and provide critical feedback from an interest party in place of a do or die first customer engagement. From the investors’ perspective, a strategic can validate a product and provide an easy exit (if an acquisition makes sense) and even a hedge (if the portfolio company doesn’t make it as a high-flyer and everybody just wants out at some point).

While CVCs don’t make sense for every deal — and perhaps not even for most — there are certain “use-cases” where the right strategic at the right time can be a huge advantage. If you doubt that, ponder this: according to PWC/Moneytree data, nearly 1/4 of all venture-backed firms have a strategic investor at some point in the cycle. While it’s certainly true that not all work out the way everyone had hoped, it’s also true that there’s probably a horse in there somewhere. Given that, the task is to improve CVC processes and thereby more effectively bring corporate investors into tune with the way the venture business works.

Unabashed plug: for anyone who wants to explore these ideas further, feel free to take a look at our website, www.synchronyvm.com.

_________________________
Adam D. Caper, Managing Director
Synchrony Venture Management
99 High Street, 7th Floor
Boston, MA 02111
0/617.247.6300 x701
m/617.852.6054
acaper@synchronyvm.com
www.synchronyvm.com

_________________________
Adam D. Caper, Managing Director
Synchrony Venture Management
99 High Street, 7th Floor
Boston, MA 02111
0/617.247.6300 x701
m/617.852.6054
acaper@synchronyvm.com
www.synchronyvm.com

]]> Comment on The Facebook has no Face…… by briznz http://tristateventuresblog.com/2007/11/03/facebook-disaster/#comment-17 briznz Sun, 04 Nov 2007 14:32:08 +0000 http://tristateventuresblog.com/2007/11/03/facebook-disaster/#comment-17 Facebook has 50 mil users what are you drinking >? Facebook has 50 mil users what are you drinking >?

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