Tag Archive for 'Venture Capital'

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Sequoia Capital Investment Strategy

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Since founding Sequoia Capital in 1972, Valentine has financed many of the companies (Apple, Oracle, Electronic Arts, NVIDIA, Cisco, Google, and YouTube) that have been Silicon Valley’s biggest technology and business success stories.

One of the latest investments by Sequoia is in New York based startup Tumblr, which offers easy-to-use publishing and social networking tools for bloggers.

Sequoia is looking for the best and brightest who may not know about managing a company but who may know a crucial piece of information about a technology or an industry. “People who have a dream and a way to solve a problem — who are interested in solving technological problems and creating new products.”

Markets are Sequoia’s focus, he said: “The size of the market, the dynamics of the market, the nature of the competition. Our objective is always to build big companies — if you don’t attack a big market, you’re highly unlikely to build a big company.”

Intel Invests in Middle East

At last week’s World Economic Forum (WEF) meeting in Marrakech, one interesting announcement largely flew over Western heads: Intel Capital has made large-scale investments in three Jordanian and Lebanese companies.

The three startups that have received fresh capital from the investment organization are UK/Lebanon based Nymgo (which delivers cheap VoIP telephony services), Jordan-based Jeeran (social networking site) and ShooFeeTV (which operates a Web-based entertainment guide) [Source].

Intel Capital’s interest in the Middle East region coincides with WEF meetings in the area–a 2009 conference in Jordan was marked by a similar round of investment. The mere fact that Intel is exclusively going after internet portals and communication facilitators will have an effect on the shape of the local start-up scene: Newly minted investors and techies will naturally want to go where the money is [Source].

US$250 Million sFund

Companies developing social-media applications for Facebook have a new place to look to for funding: one of Silicon Valley’s most powerful venture-capital firms: Kleiner Perkins is teaming with social and traditional media companies to back a $250 million fund aimed at fostering social-technology innovation.

The firm, Kleiner Perkins Caufield & Byers, announced it was creating an “sFund” devoted to putting money on the table for companies developing social-media applications—particularly those that could be integrated with Facebook and the social network’s 500 million users [Source 1] [Source 2] [Source 3].

“Think of it as a quarter-billion-dollar party,” said John Doerr, a partner at Kleiner Perkins. He called social media the next great wave of disruptive technology to come from Silicon Valley, after the development of personal computing and then the Web browser. Doerr, one of the most important venture capitalists and thinkers on the Silicon Valley scene.

Google & CIA invest in Analytics Venture

The investment arms of the CIA and Google are both backing a company that monitors the web in real time — and says it uses that information to predict the future.

Google Ventures and In-Q-Tel, the CIA’s investment arm, have injected sums (less than $10 million each) into Recorded Future, a company that goes through “tens of thousands” of websites and looks for related actions and conversations between, for example, Twitter accounts, blogs and websites, and analyzes them in order to spot events and trends as early on as possible [Source].

GE’s “Ecomagination Challenge”

Got a bright idea? How about an energy-saving one? GE announced today a $200 million “open innovation challenge” that invites inventors, entrepreneurs, and startups of all stripes to compete to develop the next-generation of power grid technologies.

Called the Ecomagination Challenge, this huge investment comes only weeks after GE announced a $10 billion injection into its own eco-R&D projects.Along with four VC firms that have pledged half of the $200 million to the challenge, GE is asking the public for innovative ideas in clean technology. From now until September 30, you can head to the Ecomagination homepage to submit a proposal or vote for other user-generated ideas.

GE explained earlier today that the $200 million investment could lead to acquisition or co-development opportunities, and even trademark and licensing deals. “This is wide-open,” said another investor in the challenge, who commented that the challenge should serve as a catalyst for novel ideas, regardless of who comes up with them, whether an individual or well-funded start-up [Source].

Investing in Green Technology

The Bill Gates and Khosla Ventures dream team are swooping in once again to provide much-needed cash to a worthy sustainable startup. The pair recently injected millions into nuclear power startup TerraPower, and now they’re back again to invest $23.5 million in EcoMotors’s series B funding round.

EcoMotors builds a lightweight, high-efficiency, low-cost combustion engine that supposedly offer 50% greater fuel efficiency than similar conventional engines. The company’s Opposed Piston Opposed Cylinder (OPOC) engine can be used in everything from passenger vehicles to auxiliary power supplies–anywhere traditional gas and diesel-powered engines can be found.

The Emerging Online Giants

At first glance the three firms could not look more different.

DST was created in 2005 when two Russian internet investors, Yuri Milner and Gregory Finger, pooled their interests in mail.ru, a Russian web portal. Today the firm controls many of the country’s leading websites and boasts an interesting mix of owners, including Goldman Sachs and Alisher Usmanov, a Russian billionaire, who holds 27%.

Based in Cape Town, Naspers is nearly 100 years old and is the publisher of the Daily Sun, South Africa’s biggest newspaper. But it is one of the most ambitious old-media companies anywhere in its move online. It still makes most of its sales—28 billion rand ($3.6 billion) in the year to March—from print and pay-television, but it uses the cash to buy online firms.

Tencent hails from Shenzhen, near Hong Kong. Founded in 1998, it had revenues of $1.8 billion in 2009 [Full article here].

Ecomagination $10 Billion Eco-R&D Push

GE has a whole lot faith in its ecomagination initiative. So much faith, in fact, that the company is pumping $10 billion into the project’s R&D over the next 5 years–effectively doubling its investment from the past 5 years.

The reason is simple: ecomagination is a cash cow, generating $70 billion in revenue since its inception in 2005. GE believes it will generate $25 billion in 2010, up from $18 billion in 2009. Over the next 5 years, GE hopes that ecomagination revenue will grow at twice the rate of the company’s total revenue.

Ecomagination encompasses a broad set of projects. So far, ecomagination has spawned everything from low-energy digital mammography machines and aircraft engines to gas turbines and nuclear plants. There’s plenty more on the way, including a massive battery plant in New York, a $2 billion wind project in Oregon, and a series of high-end energy-efficient front-load washers and dryers set to be manufactured in Kentucky. And we can’t forget GE’s ambitious plan into integrate appliances (i.e. hot water heaters, microwaves, and oven ranges) with smart grid technology.

VCs Go Global

VCs are on the hunt, and it doesn’t matter if a company is in Boston, Beijing, or Menlo Park, they’re looking to fund great ideas anywhere in the world. Some are even opening offices overseas in an effort to find the next big international thing.

For decades, the success of Silicon Valley has been undeniable. Venture capitalists’ investments have spawned some of the world’s most recognizable brands. Apple, Google, Intel, Cisco, Yahoo, eBay, and dozens of other household names were born and nurtured here. However, the model is changing. Venture capitalists and the companies they fund are looking beyond the Valley more often and with an eye to replicating the success of the Valley in other parts of the world ready for entrepreneurialism, risk, and reward. Find the complete article here.

The centre of the venture capital universe happens to revolve near Stanford University in California: Sand Hill Road to be precise. Explore the firms that drive the industry by clicking here for an interactive video.

Silicon Valley Gears Up for M&A

Silicon Valley companies looking to put their cash to work may drive a wave of mergers this year, bankers and venture capitalists say.

Companies are eager to make acquisitions because many of them have cut research budgets. Meaning many of them are not as able to fall back on their own ingenuity to fuel growth. More businesses are relying on acquisitions to find their next new product or service [Source].

Venture capitalists had their busiest quarter (2010Q1) in recent memory, with nine venture-backed companies going public and a record-breaking 111 companies changing hands in mergers and acquisitions according to a report released Thursday by Thomson Reuters and the National Venture Capital Association (Source: Charts). Out of the 111 M&A deals, 81 took place in the information technology sector.