Wednesday, April 3, 2013

Series A crunch for start-ups rooted in progressive de-risking of VC model?

My comment on a peHUB blog post titled "What Series A Crunch? Why Some Startups Are Immune"


Keen insight John!

Interesting to note the theme of 'venture capital model being broken' is being evaluated from very different perspectives by different people – while I’d love to see the perspective of an LP on this, haven’t come across any till date…

Earlier in Feb 2013 when Drug Baron proposed Venture Capital 2.0 on his blog, I felt he placed the onus for this handicap on the VC firms themselves & hence proposed the need for a disruptive innovation of the venture model itself. I made a comment against this entry & posted the same on my blog under the title “What when the boundaries blur between VC & PE?

While my response was more from the angle of overt de-risking of VC funding being counter-productive to sustenance of early enterprise, I felt that in some fashion resonates with what you say here…., particularly when you quote Jim Andelman “these market dynamics combine to leave good companies unfunded”.

My comments incidentally remain ‘non-commented on’ on Drug baron’s blog :-)