Venture Summit West: Is There Money Out There?

As part of our ongoing efforts to connect with the technology ecosystem, I recently took a few days off from our San Francisco office and attended Venture Summit West (organized by Youngstartup Ventures, Inc.) at the Computer History Museum in Mountain View, CA.  A high-level panel that included David Hornick of August Capital, Patricia Nakache of Trinity, Lisa Rhoads of Easton Capital, and Ann Winblad of Hummer Winblad covered topics such as “The Changing Venture World: What Can We Expect for the next 24 Months?”  Panelists noted that $47.3 billion of venture money was invested in 2013.  The majority of the money was made in Silicon Valley; however, the New York City area had significant gains and was second in investment deals.  

The panelists noted that in 2014 seed rounds are up.  There is a blurred line between series A and seed rounds probably caused by an overall increase in the availability of investment funds.  They also noted that series B rounds increased in 2013.

With the increase in overall global wealth, funds are getting bigger and bigger.  Some venture funds have raised new funds but are trying to keep the individual investments and tranches small in order to maintain a personal touch with the management of the portfolio companies.  There was a consensus with the panelists that venture capital is a personal business and they want to be focused on helping their investments succeed.  They want to work closely with their companies.  Patricia Nakache of Trinity said that she would like to keep investments on a modest scale in order to be accessible to their CEOs.

Panelists noted New York and Silicon Valley are great and very much happening but venture opportunities are everywhere. 

With the low barrier of entry and interest in startups, we are seeing a lot of incubators and accelerators these days.  Incubators are generally good but VCs want to date and get to know company management.  VCs also want to see how management behaves in a coaching environment. 

Accelerators can have great advisors but the differentiator is the quality of the advisors.  The key for start-ups is to make sure the advisors are experienced, able to coach, and are well connected.