"venture capital firms raise money from wealthy individuals, pension funds, and university endowments, and then dole it out to fledgling companies"
Well, now you know where your pensions went and why the kid's tuition is breaking you, 'murkn.
Related: VenCap Pissed Away AmeriKan Pensions
Debt-Loving Americans
"Painful, but positive, changes for venture funding" by Scott Kirsner, Globe Columnist | July 19, 2009
The National Venture Capital Association reported last week that venture capital firms brought in just $1.7 billion in new capital in the second quarter of 2009 (venture capital firms raise money from wealthy individuals, pension funds, and university endowments, and then dole it out to fledgling companies). That’s a precipitous plunge from $9.2 billion in the same quarter last year.
Yup, DOLED OUT to LOSERS!
Andy Payne, a serial entrepreneur who recently worked with Cambridge-based General Catalyst Partners to launch FanSnap.com, a site that helps consumers find tickets to concerts and sporting events, says over the long term the impact will be “a net positive. Excess capital is distorting to the market and to individual companies.’’ Meaning: Too much venture capital money breeds too many start-ups chasing the same opportunity, and when a company gets too much funding, it has little incentive to act frugally....
That explains ALL the LOOTINGS!
Right now, things feel eerily quiet on the venture capital front, though venture capitalists continue to take meetings with entrepreneurs who are looking for money....
One unusual thing a few venture capital firms are doing these days is bargain-hunting: They’re buying stakes in start-up companies from other venture firms, at a deep discount....
Trying to make MONEY out of FART MIST!
But biopharmaceutical companies just coming out of the starting gate, as well as clean-tech companies, could find it more of a challenge to raise money, since they require so much of it, says Dan Primack, an editor at large with Thomson Financial who keeps tabs on venture capital. That’s also true of technology companies trying to build a new piece of storage or telecommunications equipment.
Your pensions... wasted and looted!
While the overall size of the venture capital cake is getting smaller, there is some good news locally on the venture capital front. Third Rock Ventures, which was founded just two years ago, oversees a $278 million fund and has so far started eight companies, including a protein engineering company called Denovo Therapeutics and a company targeting rare diseases called Edimer Pharmaceuticals....
Yup, SOMEHOW, SOME PEOPLE can GET THEIR HANDS on MILLIONS!
Also see: Slow Saturday Special: Suffering Banks
TechStars Boston, a summer program designed to help first-time entrepreneurs start companies, will show off the first batch of nine companies that have been through the program this September. Each team gets an average of $15,000 to $18,000 of seed funding from TechStars. One start-up, Laura Fitton’s Oneforty, has already raised additional funding.
And Founders Collective is a Boston venture capital firm so new it does not yet have a website. But the partners, a crew of entrepreneurs and angel investors led by Eric Paley, Chris Dixon, and David Frankel, have already raised $30 million and made a handful of unannounced investments so far, all less than $1 million each. The Founders Collective fund could grow to $50 million over time....
How you doing on that bowl of breakfast s*** from the Boston Sunday Globe?
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