November 16, 2006 • 10:15 pm 0
Ed Freyfogle at Nestora has started an interview series on their blog:
To mix things up and get a fresh perspective we’ll be interviewing thought leaders from the UK search, property, and entrepreneurship scene once a month.
He’s asked me to break the ice with a blog interview on vertical search, which is available on the Nestoria blog. You might want to keep an eye on their site- Ed will have a raft of interesting participants over the coming weeks/months.
Filed under: Other, Venture Capital
November 10, 2006 • 9:42 am 0
I love this debate. I also love how it focuses solely on the Web 2.0 companies out there. The latest article over on alarm:clock summarizes my previous point well: (Bold is my own emphasis)
No doubt about it, it is possible for an ad-supported publishers, a social network or Web application to launch today on credit cards. But these represent a fraction of the companies that VCs are funding.The problem with this article is that it gives the impression that VC activity is centered on Web 2.0 companies, when in fact Web 2.0 deals are a fraction of VC investment. Outside Web 2.0, the costs of launching a start-up have not collapsed. Just look at the deals in the works today alone:
Brightcove is looking to raise $55M. That’s a lot of money, but Brightcove could not keep pace without it. Brightcove has 20 job openings, in their 4 offices and they probably have 200-300 expensive employees to keep in shoes. Moreover, while some costs have gone down, video serving remains terribly expensive. Brightcove is playing for huge stakes and should afford to waste some dollars to grow more quickly than revenues.
Over in Norway, Norsun raised $23M. You are going to tell us that entrepreneurs are going to build a solar panel assembly plant by putting a few thousand dollars on their credit cards.
Then there’s BlackArrow which raised $14.75M today for its video ad serving technology. We can imagine some kids out of a college developing a video ad server and putting it on the Internet. But BlackArrow needs to hire some expensive BD, sales and sales engineers to knock on the doors at ad agencies CBS, CNN and elsewhere and they need to convince people there that BlackArrow will be in business in 5 years.
Also, many of the Web 2.0 companies that are so cheap to start are extremely expensive to scale. YouTube is an excellent example with their multi-million dollar monthly bandwidth cost.
I’m a fan of capital efficiency, but the vast majority of startups need significant sums of money just to reach break even- if you don’t believe me, just look into Space 2.0 and the annual Anari X-prize. Prototypes there run into the tens if not hundreds of millions.
Filed under: Venture Capital
November 9, 2006 • 7:12 am 1
This week’s iTunes free download in the US store is Lily Allen’s “Smile”- which is white-hot here in London. It’s free, so grab the single (and catch the video if you can).
Filed under: iPod
November 9, 2006 • 6:39 am 0
I attended the Internet People dinner last night. Good turn out of innovative companies- which refreshingly weren’t necessarily looking for cash, but looking for conversation about their business. (more thorough overview here)
I saw some entrepreneurs that I have known for some time, such as Ed Freyfogle at Nestoria, and met a few new companies, mainly etribes, 82ask and Zubka.
The VCs in the room (London Seed Capital, Benchmark Capital and Ariadne Capital) were definitely given a hard time by speakers and attendees alike. We are seen as a necessary evil- which is a bit disappointing really. I think if you speak to any of the companies I’m working with they would (hopefully!) have positive things to say about our involvement and not view us as the devil incarnate. Simon Murdoch, the speaker, added a very valid point: that the real input of a VC is to make an entrepreneur aim higher. Not £10 million, but £100 million, not 5% market share but 95% market share…
I suggested to more than one entrepreneur that when dealing with a venture fund, that they do their due diligence and background checks on the VC as well- pick up the phone, speak to an existing portfolio company, get the inside scoop on your new business partner BEFORE you take the cash.
[Update] Fred, sorry I butchered your last name- that’s been fixed now. It was a pre-first-cup-of-coffee post!
Filed under: Events, Conferences and Panels, Venture Capital
November 7, 2006 • 4:28 pm 0
My colleagues at Seraphim Capital are looking for an Investment Manager:
Seraphim Capital, a London based £30m Enterprise Capital Fund, is looking to broaden its team through the appointment of a new Investment Manager. The Fund’s primary focus is on rapidly growing UK companies seeking equity capital from £0.5m to £2.0m. Seraphim is looking to invest in companies with proven revenue model which ideally have previously received equity funding.
The Fund seeks to provide sufficient funds to enable investees to reach profitability or other significant milestones such as cash flow break even. The ideal candidate for the Investment Manager role will have relevant deal experience.
Role
• Recruiting and vetting SMEs seeking equity finance
• Undertaking due diligence analysis on potential investee companies
• Financial modeling
• Involvement with the preparation investment papers for the Investment Board
• Involvement with negotiations and drafting of legal documentation
• An ongoing role in supporting follow-on actions post investment for selected investments
• Preparation of relevant quantitative and qualitative data and supporting reports
• Attending marketing and networking events
Requirements
• At least 2 years relevant experience
• Flexible “can-do” attitude
Salary
£55,000 plus carried interest, annual bonus, pension
Applicants should forward their CV’s to anna@seraphimcapital.co.uk, Reference: TechBytes.
Filed under: Venture Capital
November 2, 2006 • 10:40 pm 1
I was talking Hugo and David of the Mangrove team tonight. Hugo mentioned that they had gone public with their investment into Quintura, which I see the alarm:clock have a piece on the search engine as well today.
The company reminds me a lot of an old visual search engine I looked at in my days at Infonomia: Kartoo.
There was in interesting article on the O’Reilly radar last week, “Search startups are dead…” arguing that search innovation would only come from applications on top of search- moving up the stack, which is what Quintura are essentially offering.
I definitely don’t believe search startups are dead- I think we’ll get much better algorithms, which will rapidly displace the existing search gooood.
Search has to be one of the most interesting, relevant areas to focus on for investment. Even when Yahoo, Altavista, etc were at the top of their game, a small underdog came out of nowhere and became a $125 billion company. I think Google could topple as well- I mean, when was the last time you really got the result you wanted from a Google search?
Filed under: Software, Venture Capital
November 2, 2006 • 10:40 pm 0
I was talking Hugo and David of the Mangrove team tonight. Hugo mentioned that they had gone public with their investment into Quintura, which I see the alarm:clock have a piece on the search engine as well today.
The company reminds me a lot of an old visual search engine I looked at in my days at Infonomia: Kartoo.
There was in interesting article on the O’Reilly radar last week, “Search startups are dead…” arguing that search innovation would only come from applications on top of search- moving up the stack, which is what Quintura are essentially offering.
I definitely don’t believe search startups are dead- I think we’ll get much better algorithms, which will rapidly displace the existing search gooood.
Search has to be one of the most interesting, relevant areas to focus on for investment. Even when Yahoo, Altavista, etc were at the top of their game, a small underdog came out of nowhere and became a $125 billion company. I think Google could topple as well- I mean, when was the last time you really got the result you wanted from a Google search?
Filed under: Software, Venture Capital
