Clipmarks | chikkman's clips

CA M&A Strategy

Sat, 02 May 2009 03:47:30 GMT

clipped by: chikkman

Swainson: Since 2007, we haven't done many acquisitions. We've done a few technology tuck-ins, maybe half a dozen or less. We found that valuations got out of control, and frankly we needed to integrate our solutions that we'd organically developed and acquired, to provide a more cohesive story to our customers. So we backed off.

We're now more open to acquisitions. I don't think we've changed what we find our sweet spot to be. If I look back over CA's whole history, the best acquisitions we've done are Wily and Concord and Niku and Netegrity. Those four all were in the size you describe. They were all leaders in their technology space but were kind of boxed in -- in some cases couldn't expand internationally, or they couldn't invest enough in R&D to take their technology to the next level.

Tags: vc, mergers, strategy, software

IVP Twitter Comments

Sun, 15 Feb 2009 16:38:41 GMT

clipped by: chikkman

Clip Source: www.techcrunch.com

[Some people say] Twitter is whatever you want it to be. But at the end of the day you have this open, one-to-many network, and to enable that is this platform. But who cares? The reality is that it is a network/platform which has millions of users and thousands of applications.

Twitter does three things. It facilitates social connections with friends, colleagues, writers, and celebrities. The second is knowledge transfer. It is a real-time mechanism for tapping the wisdom of millions of people. The third is social expression. It is a mechanism for the global community to express itself.

I love that here is this cry for revenue generation out of a company not even two years old, Relax, it is coming.

Tags: vc twitter

Radically Reinventing Venture Capital

Wed, 28 Jan 2009 01:19:20 GMT

clipped by: chikkman

Clip Source: www.pehub.com

Venture capitalists are a lot like professional athletes. They often work in teams, but are largely judged on their individual statistics. A great VC can be part of a lousy fund, because his successful deals get drowned out by the aggregate performance of mediocre partners. To keep the analogy going, think Paul Pierce on the ’06-’07 Celtics.

That’s kind of the idea here. This proposal would have an experienced institutional LP (likely a fund-of-funds), create a series of loosely-affiliated evergreen “funds,” with each fund to contain just a single VC. In other words, cherrypick the cream of the crop. Give the VC an annual salary of around $1 million, an assistant, an associate and 15% of any carry. Perhaps a three-year contract, with a two-year LP option.

But what if you could have changed the ’06-’07 NBA from team vs. team to one-on-one? Wouldn’t Pierce have become far more successful?

Tags: vc

Omniture Cash Spending

Wed, 26 Nov 2008 01:03:39 GMT

clipped by: chikkman

Clip Source: blogs.zdnet.com

The key to understanding the formula is to recognize that SaaS companies bleed cash with every new customer they acquire — the complete opposite of what happens when a conventional software company lands a new account and pockets a huge upfront license fee.

GAAP forces the cost to be expensed upfront but has no way of recognizing that each Omniture customer generally starts returning a profit by the end of the year, and much sooner in the case of smaller customers.

Omniture was relying on a simple calculation that produces a ‘magic number’ telling you when you should hire more sales reps to fuel your growth as a SaaS business. The formula takes the incremental growth in the current quarter, multiplies by four to annualize it, and then divides it by the amount spent on sales and marketing in the prior quarter.

Tags: saas cash omniture

Buffet Buying Equities

Sun, 19 Oct 2008 01:34:47 GMT

clipped by: chikkman
clipper's remarks: buffet nytimes op-ed

Clip Source: www.nytimes.com

So ... I’ve been buying American stocks.

A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful.

Today people who hold cash equivalents feel comfortable. They shouldn’t. They have opted for a terrible long-term asset, one that pays virtually nothing and is certain to depreciate in value.

Wayne Gretzky’s advice: “I skate to where the puck is going to be, not to where it has been.”

What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up.

Tags: economy buffet stocks

TechCrunch Benchmark Interview

Tue, 14 Oct 2008 03:13:50 GMT

clipped by: chikkman
clipper's remarks: a few quick blurbs on benchmark's org structure and philosophy

Clip Source: www.techcrunch.com

Benchmark is a venture firm that has a rather unique structure that we talk about from time to time, it’s an equal partnership structure, so there’s not a lot of people in this office. Most importantly we don’t have what you would call a farm system for bringing talent on, so a lot of the other firms hire a lot of young people out of MBA programs, they develop them, they let them ride shot gun as they go to board meetings; they have a way to promote people

But anyway, as a result we have to find an alternative way to create generational change and bring new partners on. You can’t sit around with the same partners forever if you want a venture firm to be successful year in year out. Plus, we have a very strong philosophy that young people are going to have a big impact on the industry, and always will. When I came on board I was 32.

Tags: vc

A VC on Startup Depression

Thu, 02 Oct 2008 03:38:30 GMT

clipped by: chikkman

Clip Source: www.avc.com

I say that because in down market cycles, it's the seed and startup stage investing that dries up first. It happens every time. Seed/startup investing is most profitable early in a venture cycle and late stage investing is most profitable late in a venture cycle. It makes sense if you think of venture capital as a cyclical business and it is very cyclical. Early in a cycle you want to back young companies at bargain prices and enjoy the demand for those companies as the cycle takes hold. Late in a cycle you want to back established companies that need a "last round" to get to breakeven and you can get that at a bargain price compared to what others paid before you. I've been in the venture capital business since 1986 (that was a down cycle) and I've seen this happen at least three times, probably four times now.

Tags: vc downturn

KPMG: Clean tech investments to rise in 2009

Mon, 29 Sep 2008 12:26:40 GMT

clipped by: chikkman

Clip Source: www.bizjournals.com

Venture capitalists expect investment in clean technology to significantly increase next year and are not worried about a potential investment bubble in the clean, or “green,” technology sector, according to a survey by KPMG LLP.

According to research firm Cleantech Group, North America and European investments in clean technology, a large category that includes biofuel for transportation, renewable-energy generation, water and materials, rose to $5.2 billion, up from $1.8 billion in 2004.

Tags: cleantech vc

Insight Photobucket WSJ Story

Sun, 31 Aug 2008 16:26:21 GMT

clipped by: chikkman

Clip Source: online.wsj.com

Two years earlier, Insight employees, their friends and family paid $3 million for 20% of the fast-growing company. The group made more than 15 times its money on the investment, banking more than $40 million, according to documents reviewed by The Wall Street Journal. The firm's co-founders, Jeff Horing and Jerry Murdock, invested $300,000 apiece. Each banked nearly $5 million when News Corp.'s Fox Interactive Media bought Photobucket.

Tags: vc photobucket

NVCA Survey - VC Feeders

Sun, 13 Jul 2008 03:11:48 GMT

clipped by: chikkman

Clip Source: www.bloglines.com

The study by the National Venture Capital Association and Dow Jones VentureWire disclosed that 42 percent of VC investors went to Harvard, Stanford, University of Pennsylvania, Duke, or MIT.

Though a handful of schools produced a disproportionate slice of VCs, only 4 percent of those in the industry entered their current jobs directly from school. Prior to entering the venture capital business, 22 percent were either C-level entrepreneurs or startup employees; 20 percent worked at a larger or middle-market company; 20 percent worked at a different venture capital firm, and 19 percent worked at a law firm, consulting firm or investment bank.

Tags: vc

IPO Downturn

Sun, 06 Jul 2008 18:09:37 GMT

clipped by: chikkman

Clip Source: avc.blogs.com

In the second quarter of this year not a single company backed by venture capitalists has gone public. It is the first time that has happened since 1978, according to a venture capital industry group.

Sarbanes-Oxley and other post bubble, post Enron regulations have certainly made it harder to be a public company here in the US. I know every time I sign a 10K or 10Q, my hand shakes a little. Honestly, it takes a very big opportunity to make me want to be a significant shareholder or a director of a public company. The risks and hassles are just so big.

But the VC business without an IPO market would be a different business. It would be smaller, with fewer funds, and smaller fund sizes.

Tags: vc ipos startups

NVCA Doerr and Moritz Interview

Sat, 10 May 2008 19:49:23 GMT

clipped by: chikkman

Clip Source: online.wsj.com

Moritz said he's learned as an investor to listen carefully to entrepreneurs and only look at the facts, casting aside prejudice and opinion. "That stuff will preclude you in making a new investment in a new area that hasn't hit the radar screen yet or is preposterous to other people," he said.

Doerr added that Kleiner is trying to watch its language by eliminating the word "deal" from meetings with entrepreneurs. "If you're an entrepreneur, do you want to walk into someone's venture capital shop and be known as a "deal?" he said. Moritz followed by saying it's demeaning to use the word "project" to describe an entrepreneurs' business that they may have dreamed about for years and labored hard over.

Tags: vc moritz doerr

Buyouts Madness - Aspiring Buyouts Pros

Mon, 24 Mar 2008 04:13:13 GMT

clipped by: chikkman

Clip Source: www.pehub.com

A large rolodex is crucial factor in expanding for any buyout pro’s career, and business school is one way to start filling it. But as a panel of young buyout pros showed today at Buyouts Madness, it’s not essential.

Joel Osnoss, director at Silver Lake, said business school is great a way to build your networking base. But he opted against it because he was already doing what he loved, planned to be there for the long-term and didn’t want to jeopardize his position by leaving for a year or two for an MBA.

That clear vision of your career is essential if you do decide against it, said Phil Carpenter, senior managing director and partner at Bear Stearns Merchant Banking Partners, who also did not go to business school. If your station in the firm is not clear, you could lose out on a promotion to someone with that MBA, he said. “Do you see a clear runway?” for your career, he asked.

Tags: pe career

Buyouts Madness - PE Careers Panel

Mon, 24 Mar 2008 04:09:43 GMT

clipped by: chikkman

Clip Source: www.pehub.com

The take-away point was this: Buyout pros want the background of their new hires to look like their own backgrounds. Firms populated with former consultants are more likely to hire a consultant; firms whose partners tout MBAs will probably require the same of their fresh meat. Finding common ground is especially important for those entering the field from a nontraditional background, Palmieri said.

An MBA isn’t a must-have, she added. The degree opens some doors, and not having one closes others. But, she countered, “There’s a shoe for every foot.”

About 80 percent of private equity jobs are filled through personal connections—Palmieri stressed the importance of networking in one’s job hunt. Firms hire for two reasons: either they’ve raised more money, or an employee has left, and job hunters get access to info about those vacancies or fundraising sprees through their industry connections.

Tags: pe careers

John Doerr on Intuit

Mon, 24 Mar 2008 04:03:59 GMT

clipped by: chikkman

Clip Source: venturehacks.com

At the first Intuit board meeting I attended, I was surprised: more than half the meeting took place at Intuit’s tech support center, listening to tech reps answer customers’ product questions and fix their problems. Cook’s uniquely intense focus on happy customers and firsthand customer feedback impresses me to this day…

Cook has an unusual ability to ask the right questions (which my partner Vinod Khosla insists is more important than getting the right answers; in business, there are often several right answers).