Burnham's Beat
Why Convertible Debt Is A Sucker's Play | Mark As Read |
There are some good posts going around today on the topic of using convertible debt in seed stage venture financings including one by my former colleague Seth Levin over at Foundry that is worth a look. Rather than beat around the bush, let me just say that as someone who has made numerous angel investments in addition to lots of VC investments, Co...
Tesla Worth $1.7BN .... According To Its Bankers | Mark As Read |
Electric car start-up Tesla Motors set the roadshow terms for it?s IPO today. It plans to sell 11.1MM shares @ $16/share for gross proceeds of $177.6MM (excluding a potential 1.1MM share shoe), plus another $50M worth of stock to Toyota. Total shares outstanding after the IPO, including issued options would be 107.6MM giving the total company a ful...
Carried Interest Deal Cut, Let the Workarounds Begin! UPDATE: Some More thoughts | Mark As Read |
So Congress has apparently cut a final deal on taxing carried interest. According the Way and Means Committee the bill will: " ? prevent investment fund managers from paying taxes at capital gains rates on investment management services income received as carried interest in an investment fund. To the extent that carried interest reflects a return ...
Theater of the Absurd: Capital Gains Now Being Eliminated on Sale of VC/PE Management Companies | Mark As Read |
According to Bloomberg, there?s a nasty surprise in the bill that eliminates capital gains treatment for carried interest in investment partnerships. Not only is the government planning on eliminating carried interest on the investment profits generated by a partnership, but they are planning on eliminating capital gains treatment on ?the sale of a...
Carried Interest Deal Cut, Let the Workarounds Begin! | Mark As Read |
So Congress has apparently cut a final deal on taxing carried interest. According the Way and Means Committee the bill will: " ? prevent investment fund managers from paying taxes at capital gains rates on investment management services income received as carried interest in an investment fund. To the extent that carried interest reflects a return ...
Google Getting Gunshy on Traffic Referral Deals? | Mark As Read |
Incredimail reported its 4th quarter earnings today and the stock got killed thanks largely to the revelation that Google had recently approached it and indicated that they were considering significant changes to their policies on how their "traffic partners" are allowed to reset their users homepage and default search provider settings. You may re...
The Algorithm Myth And Why Google Will Be Hated | Mark As Read |
Google?s search algorithm, The Algorithm, is arguably the single most important computational routine in the world right now. As I outlined in my last post, for many companies The Algorithm literally controls their entire economic destiny and as Google?s traffic and market share grows, so too grows the power of The Algorithm. Traditionally, concent...
The Google Dependcy Index: A List of Public Internet Companies That Must Kiss Google's, er, Ring | Mark As Read |
Wall Street has lots of stock indexes. Everyone knows the NASDAQ and Dow Jones Industrials, but there are hundreds of other indexes for almost every sector and capitalization. With that in mind, I offer the Google Dependency Index, which is composed of a list of public companies that essentially find themselves completely at the mercy of Google. I ...
Don't Take Angel Investments From VCs | Mark As Read |
The guys over at Venturehacks have come up with an excellent idea to create a curated list of tech-focused angel investors. While I fully support the project, I did notice that the list of ?angels? includes a number of GPs at traditional Venture Capital firms. I know many of the GPs and they are all great people and great investors, but this situat...
Venture Capital and Age/Experience Discrimination | Mark As Read |
At the risk of being provocative, let me state a general and rather counter intuitive rule of Venture Capital: The more experienced and older and entrepreneur is, the harder it is to raise money for anything that isn?t directly related to their previous work history. It?s true. Just ask VCs to describe an entrepreneur and they will invariably start...
Tesla Motors Files S1; Bankers Think It's Worth at least $1.5BN+ | Mark As Read |
Electric car company Tesla Motors filed it?s initial S1 registration statement today which means that if everything goes smoothly with the SEC it is looking at a late Q2 IPO. The headline of most stories about the filing is that Tesla plans to raise $100M, but my guess is they are shooting for much more than that. A few interesting things that I no...
What Will IBM Do? | Mark As Read |
Back in the 1990?s, Lou Gerstner helped engineer one of the great turnarounds in corporate history. In just a few years, he took IBM from a cash hemorrhaging techno dinosaur on the brink of being broken into little pieces and turned it back into one of America?s most admired corporations. To help facilitate its transformation into a services-led bu...
The Three Horsemen of the VC Apocalypse | Mark As Read |
The Venture Capital industry is about to enter a kind of mid-life crisis that could test its very foundations thanks to three key drivers: Returns: For a long time, returns have the biggest selling point for venture capital as an asset class. Thanks the collapse of the tech bubble in 2000 though, historical venture returns are guaranteed to take a ...
Top 10 Best and Worst Software Stocks of 2009 | Mark As Read |
In 2009 Software Sector was up +49.0% vs. the NASDAQ's +43.9% gain and the S&P 500's +23.5% gain. This is a big improvement from 2008 when the sector was down 40.9%. The average software stock gained +91.1% indicating that small cap companies, particularly microcap companies performed very strongly. In fact, the average gain for software stocks tha...
Top 10 Best and Worst Internet Stocks of 2009 | Mark As Read |
After a dismal 2008, Internet stocks crushed the overall market in 2009, with the sector up +89.9% vs. the NASDAQ's +43.9% gain and the S&P 500's +23.5% gain. The average Internet stock gained +91.6% indicating that the gains were pretty evenly spread across small and large cap companies. Despite this year?s massive really, the Internet sector is s...
The Consumerization of Enterprise VC | Mark As Read |
(My day job is investing in the public markets, but I have a small personal portfolio of private investments, mostly angel investments in Internet and software related startups. In the past six months I have spent some time helping a few of these companies raise venture capital and this is the second of three posts I am writing on some of the key t...
2008 Software M&A: Year in Review | Mark As Read |
Unlike the Internet M&A space, the public software company M&A market was actually fairly robust in 2008 with 33 deals worth over $40BN closing. That's actually up from 2007 when 28 deals worth $18.5BN closed. That said, most of the increase has to do with several large, complex deals announced in 2007, including Nokia's purchase of Navteq and TomT...
2008 Software Stocks: An Oveview Plus The 10 Best and 10 Worst | Mark As Read |
While software stocks got hammered in 2008, they basically declined "in line" with the rest of the market as the total software market cap was down 40.9% which is just about equal to the NASDAQ's 40.5% decline and just slightly worse than the S&P 500's 38.5% decline. As I noted in my piece on 2008 Software M&A, total software market cap now stands ...
2008 Internet Stocks: Year In Review Plus 10 Best and 10 Worst Stocks | Mark As Read |
Internet stocks outperformed the market in 2008, albeit in the wrong direction. Overall, the internet sector declined -52.2% during 2008 vs. the NASDAQ's -40.5% decline and the S&P 500's -38.5% decline. Out of 128 year-end stocks in the sector, the average stock declined by -52.3% and the median stock declined by -56.2% indicating that declines wer...
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