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The Changing Venture Landscape

Both Sides of the Table

I’m over-paying for every check I write into the VC ecosystem and valuations are being pushed up to absurd levels and many of these valuations and companies won’t hold in the long term. Because to invest at a $60–80 million pre-money valuation (or even $40–50 million) before there is enough evidence of success requires a larger fund.

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This Week in VC with Rick Smith of Crosscut Ventures

Both Sides of the Table

Heck, stick around and watch me discuss the seed funding debate that is going on right now and what is happening in the VC industry overall. I give a sneak peek at a blog post I’m writing on the topic next week. Google’s investment in Zynga. Finally we covered this weeks deals. Beyond The Rack.

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The Changing Structure of the VC Industry

Both Sides of the Table

We all have one-click purchase power (Apple, Google, Amazon, eBay). The VC market has right-sized (returned back to mid 90′s levels & less competition). Lower costs to start a business (95% reduction), many more companies created & funded by angels / seed. Why is this?

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The Authoritative Guide to Prorata Rights

Both Sides of the Table

These tensions seep out in some angels or seed funds publicly or semi-privately deriding later-stage VCs for their “bad” behavior. Put simply – if you invested early in Google, Facebook, Twitter, LinkedIn, etc. I have seen bad behavior from later-stage VCs, believe me. ” Some do, some don’t.

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VC Confessions: We Passed On Twilio’s Seed Round

InfoChachkie

For a high-volume seed fund that adds many portfolio companies every year (such as our friends at 500 Startups who invest in over 100 distinct companies annually), the cost of a bad affirmative decision (a false positive) is quite low, since it accounts for a relatively small portion of their total fund.

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What Most People Don’t Understand About How Startup Companies are Valued

Both Sides of the Table

Valuing any company can be difficult because it requires a degree of forecasting future growth & competition and ultimately the profits of the organization. Brad was openly writing about this and it felt like he was giving the VC playbook away for free! Of course a group of 10 seed funds can’t fix the prices of a market.

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Get Inside the Mind of an Angel Investor

Both Sides of the Table

At Sony, he didn’t feel like he could “steer the ship” and get his ideas heard so he left and started GUBA, GUBA had no seed funding. You can write an angry email to get your emotions out but you shouldn’t necessarily send it (or wait 1 hour and then make a decision). Before GUBA, Thomas worked at Sony on the VAIO computer.

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