Can Venture Capital Be Truly Global?
Globalization has changed venture capital. VCs can no longer boast that they won't invest if the company is more than an hour away. Some VCs have set up joint ventures in Europe, India and China; others have dispatched partners and junior staffers. What is the impact on the entrepreneurs who have long depended on VCs not just for money but for introductions and access to their networks? A panel of experienced investors will discuss the new landscape and share their perceptions of how their missions have changed with the globalization of the economy. How are they sourcing and vetting companies? How do their investment interests vary by region? How valuable are cross-borders investments? Or should they even consider going global?
Where is the Exit?
It’s been a dismal downturn for IPOs of the past few years. But there are signs of change. The second quarter of 2009 saw 12 IPOs from U.S. companies, raising $1.6 billion, the first increase in IPO action since the fourth quarter of 2007. What makes now any different? For one, with the buyout boom gone bust, private equity-backed offerings are making a showing. Further, M&A deals are yielding lower valuations, making it less attractive yet at times the only avenue to liquidity. The players may have changed, but the game remains in play. What does the new deal landscape look like and what are the common characteristics of success.
Mobile: New Business Models, New Markets
As companies across the wireless value chain develop their 2010 strategic plans, they face an increasingly competitive and complex market. Many of the world’s leading mobile operators, manufacturers, and solutions providers must identify growth opportunities in mobile devices, smart phones, wireless network strategies, mobile media and messaging, and enterprise services. Will 2010 be the year when new use cases and emerging business models start to make their mark? What can we expect from the consumer market? And what are the latest trends in the wireless enterprise space?
Clean Tech: Investors Find Refuge in Sun
For 2009, global investments in clean technologies dropped 33 percent to $5.6 billion from $8.5 billion in 2008, according to a report from the Cleantech Group and Deloitte, which tracked venture investments across North America, Europe, China, and India. But that decline marks good news, relatively speaking. The drop actually puts cleantech on par with 2007 investment levels while overall venture capital retreated to 2003 levels, according to the report.
What’s keeping clean tech hotter than other areas? Interest in solar companies attracted 21 percent of clean tech venture funding, or $1.2 billion in 2009. That was followed by 20 percent for transportation – electric cars, advanced batteries, and fuel cells – that took $1.1 billion. But the one to watch, says the report, is so-called energy efficiency, which grabbed $1 billion, or 18 percent of the funding. And regionally, China is piping hot. Investment levels there were almost unchanged from 2008 to 2009, and M&A activity logged a historic high of $5.5 billion for 2009. China also accounted for 72 percent of global IPO proceeds, raising $3.4 billion from 17 companies. What do these trends mean for 2010, and what are the sectors and regions to watch?
Lessons Learned: the Path to Success
Initially, almost every startup begins with zero assets, no profits, few resources, and perhaps a handful of people, possibly even just the entrepreneurs. By the second year the company should have grown through sales of its products or services, and increased the number of employees, in addition to the original founders. At this point the company should focus all of its resources on snaring a strategic customer, which is the best customer that can make the company an attractive acquisition. This of course is an ideal scheme in an ideal market. In our real world, how do burgeoning companies grow from alpha to a strong, mature company with various exit opportunities? How do they become an alluring acquisition target?
Funding: Where is the Money?
The recession has made it harder for venture-capital firms to raise funds, causing already picky investors to become even more selective about the firms they choose to fund. Competition for venture capital has always been fierce, but the economic meltdown has intensified the battle, forcing companies that would have been able to secure funding a few years ago out of the game. Venture capitalists raised $8 billion in 83 funds during the first nine months of 2009, down from the $18.9 billion raised by 141 funds in 2008, according to a Dow Jones report. Given this climate what are startups alternative sources of survival? What should burgeoning companies do to make themselves stand out in the startups pool?
Where to Invest in 2010 and Beyond?
Silicon Valley is dead, say some industry insiders. So where are the hot new geographies and startup sectors that venture capital will deploy funding? First, the new mantra for entrepreneurs of budding startups is "capital efficiency." What this means is venture firms are looking at regions that can build promising companies capable of producing more product for less cash, offering better ROI. That path has often led to China and India but has also seen favorable returns in Europe. For example, some industry estimates put the ROI on China upstarts at 10x what a startup investment in the United States returns. Also, smaller, more-focused investments from smaller funds are proving better vehicles for GPs to produce returns to their LPs. Along with capital efficiency, manufacturing-intensive investments are taking a back seat to funding priorities of intellectual property and software, among others. Come study the global startup landscape and learn where the smart money is going from the likes of Accel and others.
Corporate Governance: a Delicate Dance
Corporate governance is a multi-faceted subject and the relationship between board members, investors, and company executives a complex dynamic. This roundtable will discuss these various relationships and the impact of a corporate governance system in economic efficiency. Another important theme discussed will be the importance of the accountability of certain individuals in an organization through certain mechanisms. How has Sarbanes-Oxley changed this system of accountability? How has it modified the dynamics within the corporate organization? A related but separate thread of discussions will focus on shareholders' welfare. Yet, another one on the stakeholder view and the corporate governance models around the world.
Monetizing the Social Network
Ad-funded social networks will provide the bulk of revenues in the mobile user-generated content space by 2013, according to a new report from Juniper Research. The report also expects the number of active users of mobile social-networking sites to rise from 54 million in 2008 to nearly 730 million in 2013. How can carriers, social networks, and advertisers alike take advantage of this emerging market? Are there any methods of revenue generation for mobile social networks other that advertising, subscription services, and premium upgrades?
* Subject to change