OregonStartups.com News

VC Investments Up in Oregon; 12% Down (or maybe Flat) Nationally

From VentureBeat: VC investments drop 12 percent from last year, fewest deals since 2005:

Venture capitalists invested $6.64 billion into U.S. companies in the second quarter, or 12 percent less compared to the same period last year, according to Dow Jones. Another research group, led by PwC and NVCA, reported flat growth from last year, although a decline from the first quarter.

On the other hand, as reported in the Oregonian (using Dow Jones data), Oregon investments were up (to $130 million) in the first half of 2008. Examples included:

• Castor & Pollux Pet Works, Clackamas: Organic pet food, $21.7 million
• NexPlanar Corp., Hillsboro: Semiconductors, $14.5 million
• Neopad, Hillsboro: Polishing pads for semiconductors: $14.1 million
• Wi-Chi, Tualatin: Semiconductors, $8 million
• Splashcast, Portland: online marketing, $4 million
• iMove Inc., Portland: video surveillance for defense and security, $4.25 million

How to find a lead investor

If you're about to raise money, there are some helpful comments in a series of Venture Hack articles, starting wtih Venture Hacks — How do I find a lead investor? Part 1.:

Summary: Financings happen when you find a lead investor, negotiate a term sheet, and if there’s room, politely tell followers that they can take it or leave it. Alternatively, if you have a group of seed investors who aren’t asking you to find a lead, you can mass syndicate the round without a lead. Finally, ‘find a lead’ often means ‘no’.

Twitter Raises Funding to Fix Infrastructure

From Union Square Ventures (A New York Venture Capital Fund Focused on Early Stage & Startup Investing): Twitter Raises A Second Round Of Funding:

Our portfolio company Twitter announced today that they have closed a second round of financing, led by Spark Capital and including Jeff Bezos' investment entity Bezos Expeditions. Union Square Ventures and Digital Garage, another existing investor, also participated in the round.

We remain very excited by the power of marrying communications and social media in the form of small microblog messages shared between friends and followers. Twitter will use the financing to shore up its infrastructure which is the number one priority of the company right now.

So maybe there's hope for Twitter infrastructure improving now...

Intel Creates Solar Company

From the Portland Business Journal today, Intel Capital is leading a $50 million round to set up SpectrWatt Inc., a solar cell startup that will build a manufacturing plant in Hillsboro.

TechStars Skips the Business Plan

From the Rocky Mountain News, Looking for the Next Tech Star. The TechStars program in Boulder, Colorado offers up to $15,000 in seed money and free office space to startups who are accepted into the program:

The startup incubator is patterned after a similar effort called Y-Combinator, which has a summer program in Cambridge, Mass., and a winter one in Mountain View, Calif. "For us, (the motivation) is largely about improving the (technology) ecosystem in Colorado as well as finding interesting investments," said Cohen, TechStars executive director. TechStars takes a 5 percent equity stake in the businesses accepted into the program, which kicked off last year. Ten groups recently started the second program. They were selected from 400 applications. Formal business plans weren't required. In fact, they weren't read. "It's too long of a document," Cohen said. "We're really looking for teams that are great, that have passion and an idea that makes sense."

Valuations up - but at a slower rate

The latest Fenwick & West  Venture Capital Survey of Silicon Valley investments in Q1 found:

... a continued increase in the valuations of companies raising venture funding compared to their prior round, but the amount by which valuations increased has declined in each of the past two quarters.

VCs and Deal Flow

From Seeing Both Sides: VCs and Deal Flow: Seeing Everything, Doing (Nearly) Nothing. A worthwhile read, especially the last paragraph:

What's surprising to me is that entrepreneurs often don't seem to know where they stand in the deal process.  Admittedly, VCs aren't known necessarily as great communicators!  But as an entrepreneur, you should know whether you are clearly one of the one or two most important new deals the VC you're talking to is working on.  If not, then you know your deal isn't going to get done and stop wasting your time.  The odds are just too long that you're stuck at the wrong end of the funnel.

Fundraising: "An exercise in getting rejected"

John Cook's Venture Blog has a May 15 posting that links to a Google video interview with Seattle several entrepreneurs. Some lessons learned: Fund raising is you other full time job Avoid venture financing for as long as you can We never would have been able to sell out for $10 million if we'd taken a large VC round

OVP Investing in Digital Media and CleanTech

John Cook's VC Notebook reported last week that OVP is working on investments in two Seattle-area digital media companies and two others in clean tech. That's a shift from OVP's historical focus on digital biology, computer networking and security. Check out the full article for an overview of OVP's focus today.

So you Want to Start a Venture Fund?

A very interesting article in Techjournal South starts with the early history of venture capital, takes it through the bubble, and comments on current trends. Along the way, there is a lot of information about how the venture capital industry works.