What Silicon Valley Entrepreneurs Want: Lots of Money with No Strings Attached

I substituted a siesta this afternoon to watch the TechCrunch50 panel on venture capital.

The members of the panel were Sumant Mandal of Clearstone Venture Partners, George Zachary of Charles River Ventures, Roelof Botha of Sequoia Capital, Raj Kapoor of Mayfield Fund and Ross Levinsohn of Velocity Interactive Group.

Joining them was serial entrepreneur Mark Pincus, no stranger to Sand Hill Road (his current startup Zynga just under $40 million in funding).

Are These Charts Worth $8 Million?

Investors have funded the startup that runs the website whose traffic is displayed in the charts below to the tune of $8 million.

Ask yourself: would you invest $8 million in this startup? Would you be pleased with the results thus far if you had invested $8 million in this startup?

Any reader who can guess the startup behind this website by August 25, 2008 will win a decommissioned Soviet Projektu-613 submarine. Pick up at the Zvezdochka shipyard in Severodvinsk only.

Note: I recognize that traffic statistics from Compete and Alexa are imperfect but they’re reliably trend-indicative.

Why VCs Invest in Stupid Companies

From Webvan to Facebook, why do VCs make stupid investments?

Since I’m often very critical of VCs, I figured it was appropriate to look at the reasons behind the their less-than-intelligent investments in .

VCs Respond to The Venture Capital Crisis

Earlier this week, the “crisis” that has hit the world of venture capital. Last quarter, not a single VC-backed company went public.

Mergers and acquisitions activity is also down. According to a Dow Jones VentureSource report, last quarter saw the “slowest pace of merger deals involving venture-backed companies in at least a decade.”

The National Venture Capital Association (NVCA) is obviously concerned and as most American industry associations do when times get tough, is putting the government on alert. In , NVCA president Mark Heesen stated, “We need to put regulators, legislators, presidential candidates, and the private sector on notice that this situation represents a serious problem that will have long reaching economic implications if not addressed.”

Ross Levinsohn: From Big Rounds to Down Rounds

Back in December, Ross Levinsohn was quoted by PaidContent as saying:

Shopping: When I asked if they’re running into companies eager to sell now in case things turn sour, Levinsohn said it was just the opposite. “I’m actually amazed by it. A year ago … there was more desperation to sell.” The Facebook platform initiative and, to some extent, OpenSocial, turned that around, adding distribution to companies that once were only features.” They now have tens of millions of users and are raising money at huge multiples—hundreds of millions of dollars—and they’ll get it.”

Facilitatr: You Need It, Our Community Gets It

For some startups, VC money may be harder to come by in Silicon Valley but that didn’t stop Pablo’s Place from closing its $12 million funding round in less than a month. So I’m back pitching another innovative service that square VCs won’t touch but really private equity will.

The Problem

Don’t Batten Down The Hatches on a Shit Business

As the realities of the current economic landscape become apparent to even the completely most uninitiated, more venture capitalists are recognizing that tougher times lie ahead.

While tough times are never good for the fairweather founders that usually flock to Silicon Valley when money is being handed out on Sand Hill Road like it’s going out of style, in a recent post on E-consultancy.com that tough times can create opportunity for smart, serious entrepreneurs.

In a post on his blog, venture capitalist Fred Wilson discussed the tough times ahead and commented:

Web 2.0 “Investment Boom May Be Peaking”

Common sense is back in vogue. From the about the Facebook hype to the Old Media isn’t dying to the growing consumer and advertiser dissatsifaction with user-generated content, it’s clear that common sense is starting to make a comeback, perhaps fueled in part by the best antidote to a kool aid-induced high - a stark economic reality.

Yesterday produced a sign that even those who typically lack common sense (venture capitalists) may be starting to recover from their stupors: Dow Jones VentureSource released 2007’s Web 2.0 funding figures which suggest that the Web 2.0 “investment boom may be peaking.”

Play Poker, Win VC Funding

What would you do to get VC funding? If you’re not playing poker in Silicon Valley, you might want to start. A recent Wired article details the chronicles of 28 year-old Zach Coelius who has worked his way into Silicon Valley’s inner circles by playing poker. His new startup, Triggit, just raised $500,000 from Bay Partners, the firm that never received the memo announcing that the New Economy was a sham.

This time, however, they’re investing for all the right reasons:

Virtual Events Provider Raises $10 Million, Misses the Point of Events

Unisfair, a Menlo Park-based startup that hosts events such as conferences, trade shows and job fairs in virtual worlds, has raised $10 million in funding from Norwest and Sequoia. Unisfair hosted more than 400 virtual events for companies like Cisco, Cognos and Nielsen over the past year and a half and appears to have a real business model.

Because the company generates revenue, you’d expect that Drama 2.0 would be a fan. Wrong. I agree with Paul Glazowski that this is a ridiculous business, but for a much different reason: Unisfair misses the entire point of corporate events. The companies that host virtual events in Unisfair’s corporate Second Life are doing a major disservice to “attendees.”

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Drama 2.0 spikes the Web 2.0 kool aid by providing critical analyses of Web 2.0, its people, its startups and its impact on the world of media. Other topics are explored when Drama 2.0 has been drinking too much 1975 Dom Perignon. Read more about the Internet's version of Keyser Söze here.