Quoted: Quoted: The liquidity drought for venture-backed startups, which was already declared to be a crisis in the second quarter when not a single VC-backed IPO went out, continued in the third quarter.
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For the first three quarters of the year combined, IPOs brought in only $470 million and M&A activity totaled $11.3 billion, a steep decline from prior years (see chart). Don’t expect the situation to get better any time soon.

Interesting

Quoted: The news that some Facebook employees are selling their stock privately naturally focuses on the price/valuation (a deep discount to the $15bn that Microsoft paid).

This is consistent with what Bill Bryant was saying in the most recent StartPad talk.

Quoted: When I look at a venture portfolio that is fully constructed, but not yet fully invested (like our 2004 fund is right now), I like to look for the deals that can return the fund. I think we have six or seven. That doesn't mean that those six or seven are the best deals in our portfolio right now. A few of them could be complete busts. But we have six or seven deals that sitting here today I can honestly construct a scenario where they will return the entire fund when they are sold. I hope that one or two will actually do it.

Quoted: And that's the big problem with corporate structures for venture investing. One time gains in corporations don't make anyone rich. Wall Street ignores the gain. The company can't put the gain into the pocket of its management. So it just doesn't matter very much.

Quoted: Kleiner’s Laws
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* Make sure the dog wants to eat the dog food. No matter how ground-breaking a new technology, how large a potential market, make certain customers actually want it.
* Build one business at a time. Most business plans are overly ambitious. Concentrate on being successful in one endeavor first.
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Paul Graham says there are not enough investors chasing the following type of deal:

Quoted: There are companies that will give $20k to a startup that has nothing more than the founders, and there are companies that will give $2 million to a startup that's already taking off, but there aren't enough investors who will give $200k to a startup that seems very promising but still has some things to figure out. This territory is occupied mostly by individual angel investors—people like Andy Bechtolsheim, who gave Google $100k when they seemed promising but still had some things to figure out. I like angels, but there just aren't enough of them, and investing is for most of them a part time job.

Quoted: Here's the problem. The company/web service creation process needs some kind of end game. The entrepreneurs who spend years and risking a ton need a way to get paid for that effort. And those of us who finance their efforts need to get some return on our investment. We can argue about the magnitude of the return we need and a host of other things, but the fact remains that without a path to liquidity, all the innovation that is being created by the entrepreneur/VC equation will stop happening.
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It turns out that there is another private liquidity market under development called Opus-5.

This is a nice checklist for evaluating a business.

Quoted: We would enjoy learning about your business. It's easy to reach us. Email or call. Have a mutual acquaintance connect us. Before you send your plan please read the Elements of Sustainable Companies and Writing A Business Plan.