Sequoia Capital is indeed in the process of raising a total of some $1 billion for a series of several new venture funds, we’ve confirmed with sources close to the situation.
The new raise is currently underway, and its structure as of now underlines the storied Silicon Valley-based venture capital firm’s increasing focus on having a global footprint. Legendary venture capitalist Michael Moritz may be stepping back from day-to-day operations at Sequoia, but one of the things he’s been most proud of over the years is making Sequoia a global firm — so this is just the latest evidence of his continuing impact there. → Read More
10gen, the company behind the increasingly popular NoSQL database MongoDB today announced that it has secured a new $42 million financing round let by New Enterprise Associates. This round also includes participation from existing investors Sequoia Capital, Flybridge Capital Partners and Union Square Ventures. 10gen says that it plans to use the financing to “invest in product development for MongoDB and the MongoDB Monitoring Service (MMS) and to better support its rapidly growing community and user base worldwide.”
Including this round, 10gen has now raised more than $73 million. → Read More
Google got the chance to buy Twitter, but the search giant passed, says Michael Arrington. “Google hasn’t been interested in buying Twitter since they committed themselves to Google+” says Fred Wilson, Union Square Ventures founder and former Twitter board member, in his fireside chat this morning with Arrington at the TechCrunch Disrupt New York conference. [Update: To clarify, I believe Google missed the boat on buying Twitter, while Wilson simply said Google wasn't interested in such a purchase since it committed to Google+. Wilson did not make a value judgement on Google not buying Twitter, nor did he confirm that acquisition discussions ever took place.]
Now Google+ is widely seen as a ghost town, and not buying Twitter could be a mistake that haunts Mountain View for years to come. Wilson has one of the most envied portfolios in venture capital, with Union Square Ventures getting in early on Twitter, Zynga, Etsy, and Tumblr. But the future might not be as bright. “I don’t think I’m going to be very good at investing in the next big thing. I don’t come from it. I didn’t work in it. The next thing isn’t going to be evolutionary. It’s going to be something completely different.” → Read More
At a very fundamental level, the venture capital business is being reshaped. Speaking to a crowd at the Grind work space in New York last week, Fred Wilson addressed this ongoing shift, saying, “there’s two times as much capital in the venture capital business today than we, the professional investors who make up the venture business, can actually put to work intelligently.” Bad for VCs, Wilson says, but good for entrepreneurs.
Of course, the fact of the matter is that the top investors are custodians of an equally valuable currency — information. With the noise and hype growing, it’s becoming even more essential to understand what it is about the anatomy of startups that makes them appealing to the right investors — or perhaps more importantly — why some of the best fail in spite of themselves.
In a new book, called Venture Capitalists at Work, Tarang and Sheetal Shah set out to provide entrepreneurs with real insight into how some of the top investors in the game evaluate, invest in, and mentor their startups — information that can be extremely powerful if put to use correctly — and that has thus far remained, they say, in a “black box.” → Read More
Editor’s Note: The following is an excerpt from Onswipe CEO Jason L. Baptiste’s new book The Ultralight Startup: Launching a Business Without Clout or Capital.
If you pay attention to the headlines about startups getting millions of dollars of funding from investors, venture capitalists, or partnerships, you might think the fund-raising process happens overnight. It all sounds so easy: Some entrepreneur with a thousand dollars in his pocket creates a great PowerPoint investor presentation, secures a few meetings with important people, and bam! A handshake, some signatures, and the deal is done.
The reality is a little trickier. Fund-raising is a process, and although the right pitch might come in handy, in this chapter I’ll discuss the practical start-to-finish way to think about fund-raising that will get you the money you want in the end. → Read More
Today was a pretty big day for 500 Startups, the Silicon Valley seed venture capital firm and startup accelerator founded by outspoken tech investment extraordinaire Dave McClure. The firm disclosed in a regulatory filing that it’s halfway finished raising a brand new $50 million round of funding, the second in its two-year history and a significant step up from the $29 million investment that it raised in its first round. 500 Startups also named four new partners — Paul Singh, Christen O’Brien, Bedy Yang, and George Kellerman — who will help select and manage the more than 100 investments that the firm makes each year.
So we were very happy to have McClure as a guest today on TechCrunch TV. Because of regulatory limitations on what companies can say while they’re in the process of raising funding, his hands were tied on lots of topics on the details of the new fund — but we were still able to get some great details from him on the future direction of 500 Startups and the venture funding world in general. → Read More
As a partner at Kleiner Perkins Caulfield & Byers, Aileen Lee has been a part of one of the most well-respected and established venture capital firms in Silicon Valley. But after 13 years with the firm, Aileen Lee is shifting her focus in a very interesting way — she’s starting a new venture fund focused on smaller, “seed-stage” investments. This is the first time that a Kleiner partner has ever left to start their own seed fund, so Lee is in uncharted territory of sorts.
In an interview with TechCrunch today, Lee outlined some of the reasons behind the launch of her new endeavor.
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A lot of things have changed in Silicon Valley in recent years — apps have access to a plug-and-play social infrastructure provided by the likes of Facebook and Twitter, the mobile boom has truly made the post-PC world a reality, services such as cloud computing allow startups to function at leaner levels than ever before, and so on. But for founders and investors, perhaps one of the most significant shifts has come from the increasingly common occurrence of late-stage funding rounds that are largely secondary stock purchasing situations.
In a panel discussion held last night by Wealthfront at the Rosewood Hotel, the longtime Silicon Valley dealmaking hotspot, VC heavyweights Sameer Gandhi of Accel Partners, Bill Gurley of Benchmark Capital, and Doug Leone of Sequoia Capital discussed the upsides and downsides of this seemingly unstoppable trend. → Read More
The Crowdfund Act, a bill to reduce restrictions on regular people investing in privately held companies, passed through the United States Senate today with flying colors in a 73-26 vote, after passing through the House of Representatives this past fall. But legislative matters are by definition quite complex (which is, of course, ostensibly why we elect people to deal with them on a full-time basis.) So we talked to Chance Barnett, the founder and CEO of Crowdfunder.com, to get an idea of what this could really mean for startups, potential investors, and the technology community at large. → Read More
Don’t be fooled by Bing Gordon’s buttoned-up sounding job title as a partner at top tier Silicon Valley venture capital firm Kleiner Perkins Caulfield & Byers — he’s known as easily one of the most fun people to talk to in the tech industry. So when we saw him in Austin, Texas at the South By Southwest Interactive conference this weekend, we pulled him aside for an interview with TechCrunch TV. → Read More
Following in the tradition of “Shit Silicon Valley Says” and other Shit ______ Says memes, August Capital’s David Hornick has made “Shit VCs Say.”
There are some gems in here, including: → Read More
Andreessen Horowitz is definitely killing it these days. The unconventional VC firm founded by Marc Andreessen and Ben Horowitz is less than three years old, but just raised its third fund. The amount raised: $1.5 billion. That puts Andreessen Horowitz in the rarified realm of only a handful of VC firms with funds of that size.
And how long did it take to raise all that money? “It took about 3 weeks of actual fundraisng activity,” Horowitz tells me. It took longer to do the actual paperwork—another 6 weeks.
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The micro-VCs are growing up. Case in point: Jeff Clavier, who started out as an angel investor backing Web 2.0 companies and then transitioned his portfolio into a more formal venture firm, SoftTech VC. Clavier just finished raising a total of $55 million for SoftTech’s third fund. SoftTech’s main focus is on three areas: mobile, next-generation e-commerce, and cloud-based services. → Read More
Alright, in my last post I argued that bootstrapping is just as over-rated as raising venture capital. But for those who decide to pursue fundraising, here are some things entrepreneurs should avoid when raising capital.
For all of the talk about how much excess capital there is, it’s actually hard to raise capital because very few projects fit the VC profile—even though many VC-funded projects come across as frivolous, me-too projects. → Read More
Last week at Le Web, Alexia interviewed Sean Parker and Shervin Pishevar onstage in what turned out to be one of the most-buzzed about sessions. Here is the full video for your weekend watching pleasure. It’s a great discussion that ranges across the state of startups, venture capital, music, and politics .
Parker bemoans the surplus of venture capital for its effect of diluting the talent in the tech industry, a point he’s made before. “It prevents the aggregation of talent around great ideas,” he says. He emphasizes the need for a great team from the get-go. “People are the greatest asset class,” Pishevar agrees. The conversation quickly turns to Gowalla, which recently was acquired by Facebook, and why it failed to take on Foursquare. “If you don’t fail, you haven’t tried hard enough,” says Pishevar. → Read More
The venture capital industry is going through a ton of disruptions lately. One of the better explanations I’ve heard recently of what is going on comes from Duncan Davidson, a managing partner at Bullpen Capital who gave a great talk on the subject at TechCrunch Tokyo last week. I interviewed him backstage on video, where he summarized his views.
Just as there are now legions of “lean startups” which require less capital to build a product, Davidson argues that a “lean finance model” is also needed → Read More
In Part III of my interview with Accel partner Jim Breyer, we get into the disruptions occurring in the venture capital industry itself with the abundance of angel money and the impact that is having on traditional VC firms. In the video interview above, I ask him whether he thinks there is a Series A Crunch. “I don’t think there is,” he states, echoing what Paul Lee has argued here before. Breyer counters that venture capital is not “uniformly distributed” and there are some markets, such as Brazil, where even seed stage capital is not plentiful enough.
“It is the best time over the last decade that I can think of to be an entrepreneur,” says Breyer. → Read More
In this video interview, I ask VC Jim Breyer what he thinks about the current IPO market and whether he agrees with Steve Case, who argues that we need more IPOs to create more jobs—“90% of job growth is after a company goes public.”
Breyer disagrees with Case that IPOs are the answer. At About the 2:35 mark, he says that the IPO process could be made a little bit easier, but ushering in a flood of IPOs could cause more problems than it solves. ” What I would never want to see is a repeat of when public companies were created twice a day and investors lost 80% of their money,” he cautions. → Read More
A lot has been written about the Series A Crunch. The gist of the argument is that the number of seed financings have gone up (with the advent of incubators such as Y-Combinator, TechStars, and Excelerate, as well as a new generation of Super Angels, who may or may not be hanging out at Bin 38), but the number of Series A financings have remained relatively steady. Ergo, the percentage of companies that can’t raise a Series A must be going up.
So what the hell is really going on? While a lot has been written about the subject, I think the reality is the Series A Crunch is bullshit and people are misreading the signals here. → Read More
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