Download - WebGuild Startup Idol VC Perspective
![Page 1: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/1.jpg)
Ethan Kurzweil
Bessemer Venture Partners
Startup Idol Conference
July 23, 2009
VC Perspective on Trends in Investing
Presentation online at: http://www.slideshare.net/ethankurz
![Page 2: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/2.jpg)
Bessemer Venture PartnersFounded 1911
Mumbai (India)
IsraelBostonNew York
Califonia
Presentation online at: http://www.slideshare.net/ethankurz
![Page 3: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/3.jpg)
Andre PeroldFinance Professor
Harvard Business School
$100 Trillion
And so you asked for trends…
![Page 4: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/4.jpg)
Page 13
USA Venture-backed M&A and IPO transactionsExit activity falls in the wake of the financial crisis
45
101
2111 13
2430 33
51
25
3
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
Q1200
9
19.5 19.2
1.8 1.6 1.53.7
6.8
0.6
5
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
Q1200
9
US venture-backed M&A transactions $Band number of transactions
US venture-backed IPO amount raised by transactions $B and number of transactions302 200 390 393 361 480 465 471 462 348 68 250 202 22 20 23 67 43 56 76 7
Source: Dow Jones VentureSource Note: chart scales vary for clarity
2.4
![Page 5: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/5.jpg)
$3.9
$6.0
$7.8$8.2
$7.8$7.9$8.1$8.1
$7.3$6.6
$7.8$7.6
$6.5477
601635
701706725683
791
653640695713
640
$0
$2
$4
$6
$8
$10
1Q06 3Q06 1Q07 3Q07 1Q08 3Q08 1Q09
0
150
300
450
600
750
Amount Invested ($B) Number of Deals
Investment Activity Declines in 1Q ‘09Deal Flow and Equity into Venture-Backed Companies
Am
ount
Inve
sted
($B) N
um
ber of Deals
Source: Dow Jones VentureSource
![Page 6: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/6.jpg)
Signs of hope in Q2…
![Page 7: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/7.jpg)
And even better, first-time financings are on the rise
![Page 8: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/8.jpg)
When Great Companies Were Founded…
1980 1982 1984 1986 1988 1990 1992 1994 1996
FORE SYSTEMS
![Page 9: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/9.jpg)
When Great Companies Were Founded…
2001 2002 2003 2004 2005 2006 2007
![Page 10: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/10.jpg)
What’s hot right now?
![Page 11: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/11.jpg)
Big Markets
• Energy• Internet• Stem Cells• Security• Mobile• Consumerization of
enterprise software
• India• Web Video• Social Gaming• Virtualization• SaaS
![Page 12: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/12.jpg)
Resistant: Open Source, Virtualization, Low Cost Recurring
Revenue Models
Portfolio Analysis of Exposure to Changes in GDP
Immune: Cure Cancer , Cost Saving Non-Elective HC Services
Exposed: Consumer Products, Internet Display Ads, Elective
Surgery
Source: Scale Venture Partners
Benefited by GDPChanges
![Page 13: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/13.jpg)
Page 18
Israel: Current status of VC-backed companies by year of initial financing
30
8
108
23
169
276 18
1996-2001
2002-2008
IPO M&A Private & Independent Out of Business
225
Source: Dow Jones VentureSource
Year of initial VC financing
325
► In Israel 325 companies have received initial VC financing globally since 2002 and US$2.8 billion has been invested in them to date.
► In the israel 70 Venture-backed M&A and IPO transactions were at 2007-2008
532
Page 19
Total capital invested to date in Israel VC-backed companies by year of initial financing and current status
$2,536.3
76
$134.9
$28.0
1996-2001
2002-2008
Source: Dow Jones VentureSource
Year of initial VC financing
►Israel Venture-backed M&A and IPO transactions value at 2007-2008 is $ 3.9B
$2.8B
$5.7B
Source: Dow Jones VentureSource
Failure *is* an option...
![Page 14: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/14.jpg)
Bessemer’s Law of Internet Efficiency
Cost
1995 1999 2003 2007
“The time and money required to
produce (design, develop, test, launch,
scale) a basic e-commerce application
drops in half every two years.”
$300
$20,000
NetScape
Apache
Java
ActiveX
Flash
Shockwave
PHP
XML
Ruby on Rails
service APIs
Amazon EC2
AJAX
Web Application Development
And here’s why…
![Page 15: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/15.jpg)
![Page 16: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/16.jpg)
Piryx
![Page 18: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/18.jpg)
MashLogic
“It’s like a frickin Swiss Army Knife for hyperlinks…I’m putting this on my must-have list of Firefox addons.”
![Page 19: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/19.jpg)
What’s hot right now?
CAPITALEFFICIENT
![Page 20: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/20.jpg)
Tip #1: Meet your new sales force…
![Page 21: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/21.jpg)
Tip #1: Meet your new sales force…
![Page 23: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/23.jpg)
Tip #3: Design: less is more…
![Page 24: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/24.jpg)
Tip #4: Who are your customers?
![Page 25: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/25.jpg)
Tip #5: Offices are overrated
![Page 26: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/26.jpg)
If Bessemer won’t invest…
![Page 27: WebGuild Startup Idol VC Perspective](https://reader033.vdocuments.us/reader033/viewer/2022061223/54c2cf714a7959bf198b4574/html5/thumbnails/27.jpg)
Ethan Kurzweil
Bessemer Venture Partners
Twitter: @ethankurz
Slides available at: http://www.slideshare.net/ethankurz
Startup Idol Conference
July 23, 2009
Thanks!