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Andy Harrison was at Google when the tech giant launched the Transformer machine learning model in 2017 — a massive leap forward in the way machines understand and generate human language that paved the way for the rapid rise of generative AI technologies like ChatGPT five years later.
Now Harrison is the CEO and managing partner at Section 32, a venture investment firm with ties to Google that also invests heavily in AI. READ MORE
Andreessen Horowitz is known for its bets on then-startups such as Facebook, Instagram and Airbnb.
Firm founder Marc Andreessen is also known for his opinion pieces, from “Software Is Eating The World” to the new and much-discussed “The Techno-Optimist Manifesto” published last week. The 5,000-word “manifesto” basically says technology is the cure for — not the cause of — the world’s ills and comes complete with an enemy list and even a “meaning of life” entry. READ MORE
For a number of years, one of startup investors’ favorite activities involved writing checks to companies in the supply chain management sector.
From 2018 till the end of 2022, investors across the globe poured more than $50 billion in seed through growth financing into supply chain-related companies, per Crunchbase data. Several startups raised billions, including cold chain logistics company Lineage Logistics, freight-forwarding platform provider Flexport, and Hong Kong-based Lalamove. READ MORE
The third quarter is behind us, but the scores are still being totted up. This week will bring a deluge of numbers from major tech companies, helping us better understand the state of the market, for example. Another lens into the third quarter that has yet to gel are its venture capital results. We’ve covered the big numbers from the United States, Europe, Latin America, Africa and India, and we’ve looked at how far capital has extended to underrepresented groups. READ MORE
Strategic partnerships are formidable tools in an entrepreneur’s arsenal, capable of accelerating growth, adding credibility to your offerings, and opening doors to new horizons. However, when mishandled, they can spell the slow decline of your business. READ MORE
Many business owners and founders have an eventual goal to sell their company. But not all do, especially those who are younger or earlier in the growth phase of building their company. The idea of completely disengaging from the business one spent years—even decades—building just isn’t appealing for those with an enduring entrepreneurial spirit, even with the sale proceeds from an exit in mind. Many fear having “nothing” left after a sale, whether emotionally or in terms of how they will fill their days post-transaction. READ MORE
Sometimes the nontraditional route leads to the best results. Zach Coelius, the managing partner of Coelius Capital, started out as an entrepreneur. Over the past two decades, he founded a bunch of companies, and after a successful exit from one of those, he fell into the world of angel investing via syndications.
And after some time in that world, his connections led him to VC, but not as part of a group. Organically, Coelius’ connections and reputation let him function as a solo general partner (GP). READ MORE
It’s down from a torrent to a trickle. What’s an entrepreneur to do?
The 10-year U.S. Treasury-bond rates are approaching 5%. The days of wine, roses, and the cheap money that has been easily available for the last 15 years may be ending. READ MORE
In 2003, a group of approximately two dozen lawyers specializing in venture capital (VC) finance embarked on a mission to standardize the financing documents utilized by VC firms for investments in US-based startups. The primary objective was to mitigate the transaction costs associated with memorializing the non-binding term sheet negotiated between a company and a VC investor. While a term sheet typically outlines the standard economic and governance terms (e.g., valuation, type of liquidation preference, the number of investor- and founder-appointed directors), translating these core “deal” terms into definitive financing documents often entailed further negotiation. This additional negotiation occurred as both investor and company counsel sought to converge on the precise contractual language that would legally govern the investment. The standardization project aimed to curtail this latter form of negotiation by establishing a standard “template” for each of the five documents used in US VC finance. Since December 2003, the National Venture Capital Association (NVCA) has hosted these templates on its website, leading to their colloquial reference as the “NVCA financing documents.” READ MORE
My experience as a female founder hoping to secure venture capital (VC) funding can be summed up in one anecdote: I was at lunch with a hedge fund guy. He polished off the sample can of my Sang Vietnamese Coffee. We talked through the business fundamentals, and he smiled and nodded at every juncture. Then he said, “Lan, investing in women hasn’t panned out for me.”
This investor had watched numerous male entrepreneurs go under—and yet he continued to invest in them. The fact that a few failed attempts by women entrepreneurs were being used to paint an entire gender with a broad brush is like blaming a single raindrop for a flood. But that’s what you’re up against when you’re a female founder. READ MORE
The magic of live panels is that speakers always make comments you didn’t expect — even if you are the moderator and no matter how much prep you have done. I know this from experience: It happened to me at TechCrunch Disrupt 2023.
The panel in question focused on capital-intensive startups, so I knew that we were going to discuss alternatives to venture capital as sources of funding. What I wasn’t prepared for was for the three panelists to agree on dissing venture debt. I was clearly surprised. READ MORE
California passed a bill earlier this month that requires venture firms operating in the state to report the diversity breakdown of their investments. The news of its passing spread quickly through the startup world, and immediate reactions to it have been split.
There are those in favor of the bill, those who support it but with caveats, and those who simply don’t think this will bring any change. Oh yes, and those who simply made fun of it. Still, most people brought up good points in their support and criticism of the bill, called SB 54, and we spoke to industry players to put everyone’s thoughts on the bill into one place. READ MORE
Despite the tumultuous economy we’ve experienced over the past few years, the IPO market may be starting to turn a corner. While a plethora of companies went public in 2020 and 2021, the number has recently declined due to rising interest rates and inflation. However, as the economy slowly begins to stabilize, we’re seeing things shift once more.
I’ve worked alongside several companies as they go public — including tactical, hands-on work auditing every single transaction from the start of one company’s life. This work provided insight into key hires, sales deals and other critical strategic factors that greatly contribute to a thriving IPO. READ MORE
As positive indicators for private equity have become scarce in 2023, exit totals are one metric that is moving in the right direction for fund managers.
Exit totals increased to 467 globally in the third quarter, up more than 5% quarter over quarter and nearly 22% year over year, according to S&P Global Market Intelligence data. Private equity has now recorded three consecutive quarters of improving exit data after bottoming out at just 286 in the fourth quarter of 2022. READ MORE
With the world’s most influential benchmark for the cost of debt, the U.S. federal funds rate, rising to 5.25-to-5.50 percent from a floor of zero over the 16 months through July - the fastest sustained hike in 40 years - the $9 trillion-in-assets private equity world must brace for a sharp rise in poorly performing portfolios and the emergence of a new class of the walking dead among private equity managers.
Exactly like the private equity zombie managers that emerged from the wreckage of the 2009 global financial crisis, the latest generation of the walking dead won’t be able to raise new capital because of poor performance. With private equity investments typically locked up for at least a decade, these ghouls will continue milking management fees from investors for mediocre and over-leveraged assets for years, just as they did in the decade following the GFC. READ MORE
Investment in climate technologies fell dramatically 2023 as economic headwinds dented investor confidence in all sectors of the economy, the latest data from PwC has shown.
The consultancy giant's recently published State of Climate Tech report notes that venture capital and private equity investment in climate technology has fallen 40 percent year-on-year in 2023 amid a challenging economic environment and geopolitical turmoil. READ MORE
Recent coverage of private market data from Cambridge Associates has surprised many by revealing the extent to which European venture capital has outperformed American venture capital in recent history.
Over the past 20 years, 10 years and 5 years, Europe led in net annual returns by 0.31%, 1.92% and 6.24%, respectively. READ MORE
The government has rejected a series of recommendations put forward by MPs aimed at bolstering diversity in the venture capital industry.
The Treasury Select Committee had called on the government to introduce sweeping measures after accusing VC firms of focusing their investments too heavily on London and the South East and warning that current diversity statistics were "unacceptable". READ MORE
In 2022, just 1% of all venture capital funding went to Black-founded companies—an estimated $2.3 billion of a total $215.9 billion. For women founders, the rate was only slightly higher, at 1.9%.
In an attempt to increase transparency around diversity and make the industry more equitable, California passed a law requiring VC firms to disclose diversity data about the companies they fund. But while this might nudge some companies to make their funding more diverse, some VC firms have been taking this approach for years. Among those VCs, there are mixed feelings on the law and its potential effects on innovation. There are also questions as to whether simply exposing the data goes far enough to address the disparities. READ MORE
I’ve said it before and I’ll say it again: Over the course of their careers, LPs have maybe two to three windows to buy at the bottom. Our current market is one of them.
We’ve all seen stories about how LPs are shying away from venture in the wake of macroeconomic trends, war, interest rates — the list goes on. The saying, “Those who fail to learn from history are doomed to repeat it” rings especially true in our current climate, and the window for LPs to nail one of those two or three career bottoms is beginning to close. READ MORE