Barry Weinman's Posts - TechHui2024-03-28T16:26:31ZBarry Weinmanhttp://www.techhui.com/profile/BarryWeinmanhttp://storage.ning.com/topology/rest/1.0/file/get/353361756?profile=RESIZE_48X48&width=48&height=48&crop=1%3A1http://www.techhui.com/profiles/blog/feed?user=1fz9kbybhhwx1&xn_auth=noReaching for the Cloudstag:www.techhui.com,2010-09-14:1702911:BlogPost:673462010-09-14T21:33:38.000ZBarry Weinmanhttp://www.techhui.com/profile/BarryWeinman
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<div><p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><span class="Apple-style-span" style="color: rgb(0, 0, 0); font-family: arial; font-size: small;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">Folks…good article about an emerging high tech investment strategy and opportunity for local companies to participate in……</span></font></span></p>
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<div><p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><span class="Apple-style-span" style="color: rgb(0, 0, 0); font-family: arial; font-size: small;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">Folks…good article about an emerging high tech investment strategy and opportunity for local companies to participate in…</span></font></span></p>
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<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><strong><span style="color: blue;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">Reaching for the Clouds</span></font></span></strong></p>
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<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><span style="color: blue;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">By Alastair Goldfisher</span></font></span></p>
<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"></p>
<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><span style="color: blue;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">Forget about cleantech, mobile apps or even China. What I’ve been asking VCs about lately is their cloud strategy.</span></font></span></p>
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<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><span style="color: blue;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">And if they don’t have one, I want to know why.</span></font></span></p>
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<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><span style="color: blue;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">Just yesterday, I wrote about the cloud storage appliance-maker</span></font> <a href="http://www.pehub.com/82136/storsimple-gets-13m-as-cloud-storage-continues-to-lure-vcs/" target="_blank"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">StorSimple</span></font></a><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">, which is announcing today that it has banked a $13 million Series B round from new investors Mayfield Fund and Ignition Partners and return VCs Index Ventures and Redpoint Ventures.</span></font></span></p>
<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"></p>
<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><span style="color: blue;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">Meanwhile, I’m reporting on another cloud storage company that is getting ready to come out of stealth mode in the next couple of days to announce an 8-digit Series A round. Stay tuned for more details about that Silicon Valley startup.</span></font></span></p>
<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"></p>
<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><span style="color: blue;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">These and other recent fundings come as at least five cloud-based, venture-backed companies have been acquired in recent weeks, with the $2.4 billion sale of 3PAR being the most prominent. The M&A activity is leading many to wonder what other cloud companies are hot targets. My colleague Deborah Gage and I wrote about that in the latest issue of</span></font> <em><span><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">PE Week</span></font></span></em> <font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">(subscribers can access it</span></font> <a href="http://www.pewnews.com/story.asp?sectioncode=35&storycode=1823565" target="_blank"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">here</span></font></a><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">).</span></font></span></p>
<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"></p>
<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><span style="color: blue;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">As one cloud executive told me at the VMworld conference in San Francisco earlier this month: “Things are certainly getting frothy, and we expect to see a lot more acquisitions…in the months ahead.”</span></font></span></p>
<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"></p>
<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><span style="color: blue;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">Many VCs have already figured this out, as evidence by StorSimple and other recent deals. When Redpoint Ventures raised $400 million for its fourth fund, which closed in February, the firm, which also is an investor in Cloud.com, said that it would focus on cloud deals along with social media, mobile Internet companies and cleantech. I’ve heard of other venture firms creating entire practices to go after the market.</span></font></span></p>
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<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><span style="color: blue;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">Yesterday, I spoke about what’s going on in with Navin Chaddha, managing director at Mayfield, which led the StorSimple Series B funding. Chaddha was extremely bullish about the market. Fresh off of the sale of 3PAR, which the firm still held a sizeable number of shares in, Mayfield is also an investor in cloud companies Marketo, Cloud 9 Analytics and Gigya.</span></font></span></p>
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<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><span style="color: blue;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">Chaddha is one of four partners at Mayfield looking at enterprise deals and cloud opportunities. The StorSimple deal is part of the firm’s 13th fund, which closed with nearly $400 million in commitments in 2008.</span></font></span></p>
<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"></p>
<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><span style="color: blue;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">Chaddha believes that the nascent market will be a target for VCs for the next five to 10 years, in part because of the technology’s ability to make enterprises more efficient and to bring economies of scale to networks.</span></font></span></p>
<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"></p>
<p class="MsoNormal" style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px;"><span style="color: blue;"><font class="Apple-style-span" face="tahoma, sans-serif"><span class="Apple-style-span" style="font-size: medium;">“VCs like funding companies that solve pain-points for consumers,” Chaddha says. “Whether it’s infrastructure companies, like 3PAR or StorSimple, or cloud applications or cloud-based software-as-a-service, the opportunities are massive. The cloud market is here to stay.”</span></font></span></p>
</div>VCs And Super Angels: The War For The Entrepreneurtag:www.techhui.com,2010-08-16:1702911:BlogPost:657682010-08-16T19:24:06.000ZBarry Weinmanhttp://www.techhui.com/profile/BarryWeinman
<div style="font-weight: bold; color: black;"><span class="Apple-style-span" style="color: rgb(27, 27, 27); font-family: 'Lucida Grande', Verdana, 'Lucida Sans Regular', 'Lucida Sans Unicode', Arial, sans-serif; border-collapse: collapse;"><span class="Apple-style-span" style="font-size: large;">Will the US create the next CISCO or Google, or an app to find a medium rare hamburger with less than 1,000 calories?…</span></span></div>
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<div style="font-weight: bold; color: black;"><span class="Apple-style-span" style="color: rgb(27, 27, 27); font-family: 'Lucida Grande', Verdana, 'Lucida Sans Regular', 'Lucida Sans Unicode', Arial, sans-serif; border-collapse: collapse;"><span class="Apple-style-span" style="font-size: large;">Will the US create the next CISCO or Google, or an app to find a medium rare hamburger with less than 1,000 calories?</span></span></div>
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<div style="font-size: 2em; font-weight: bold; color: black;"><a href="http://techcrunch.com/2010/08/15/venture-capital-super-angel-war-entrepreneur/" rel="bookmark" title="VCs And Super Angels: The War For The Entrepreneur" target="_blank" style="color: black; text-decoration: none; font-weight: bold;">VCs And Super Angels: The War For The Entrepreneur</a></div>
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<div>by <a rel="nofollow" href="http://techcrunch.com/author/tcmarrington/" title="Posts by Michael Arrington" target="_blank" style="color: rgb(46, 46, 46); text-decoration: none; font-weight: bold;">Michael Arrington</a> on Aug 15, 2010</div>
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<div style="font-size: 1em; line-height: 19px; color: rgb(39, 39, 39);"><div><p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;"><img src="http://tctechcrunch.files.wordpress.com/2010/08/coldwar.jpg" alt="" style="border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; border-style: initial; border-color: initial; float: left; margin-top: 0px; margin-right: 1em; margin-bottom: 1em; margin-left: 0px; max-width: 620px;"/>It’s a lot like the Cold War – most of the really interesting fights among startup investors – and there are lots of them – occur behind the scenes. Publicly everyone gets along just great. But declining returns, too much capital and the disruptive force of a new breed of angel investors has created enough tension in the system that some frustrations are beginning to boil over. And in some cases, the gloves are coming off.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">And entrepreneurs can and do get caught in the cross fire. Pick the wrong investor and you’ve closed the door on others. You’ll never even know why it happened, but it will.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">Until very recently there was an established pecking order with venture capitalists. The top guys, most would include Benchmark, Kleiner and Sequoia on that list – would see every deal. They’d mostly compete amongst themselves for those deals. And if all of them passed, the other guys got to take a look. The system was so firmly established that some VCs gave up trying entirely. DAG, for example, built a fund based solely on the promise that they’d follow the big guys, in later venture rounds at much higher prices. For investors, it was a way to get in on the hottest deals, albeit at worse terms. And the top tier funds could show startups a way to raise more money over two rounds at a higher average price, helping to justify the premiums charged by these firms. Sometimes DAG would even be willing to step in and take the PR hit when things <a href="http://techcrunch.com/2008/12/15/the-extraordinary-happenings-at-bittorrent/" target="_blank" style="color: rgb(0, 159, 0); text-decoration: none; font-weight: bold;">went wrong</a>.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">Today things are much more complicated. More funds are arguably in the top tier – guys like Accel, Andreessen and Greylock have risen. But more disruptive are the angel investors. It used to be that angels worked with venture funds, doing the very early rounds and then handing things off when a company did well.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">But the last several years have seen the rise of the cheap startup. Internet startups can use open source software and new scripting languages to ship products fast and cheap. Often there’s no need to go past an angel round of funding until it’s time to decide between selling and doing a big marketing push. Either way the VCs lose, because even if they get in at that late stage the valuations are much higher and returns plummet.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">An entire generation of entrepreneurs have stopped thinking about hitting up those top tier VCs as their first step in the startup process. Many now simply begin with Y Combinator, or take a small angel round. These angels are fast and nimble and they are hanging out with the entrepreneurs at events, incubators, etc. They are in the fray, while many of the old VCs remain above it all, waiting for the entrepreneurs to come to them, hat in hand.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">And those angels aren’t shy about trashing the VCs. Angel investor <a href="http://www.crunchbase.com/person/dave-mcclure" target="_blank" style="color: rgb(0, 159, 0); text-decoration: none; font-weight: bold;">Dave McClure<img src="http://i.ixnp.com/images/v6.40/t.gif" style="border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; border-style: initial; border-color: initial; float: none; max-width: 2000px; margin-top: 0px !important; margin-right: 0px !important; margin-bottom: 0px !important; margin-left: 0px !important; max-height: 2000px; min-width: 0px; border-style: initial; border-color: initial; font-style: normal; font-weight: normal; font-family: 'trebuchet ms', arial, helvetica, sans-serif; line-height: normal; background-color: transparent; width: 14px; min-height: 12px; padding-top: 1px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; text-decoration: none; vertical-align: top; display: inline; background-repeat: no-repeat no-repeat;"/></a> goes on<a href="http://500hats.typepad.com/500blogs/2010/07/moneyball-for-startups.html" target="_blank" style="color: rgb(0, 159, 0); text-decoration: none; font-weight: bold;">regular rants<img src="http://i.ixnp.com/images/v6.40/t.gif" style="border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; border-style: initial; border-color: initial; float: none; max-width: 2000px; margin-top: 0px !important; margin-right: 0px !important; margin-bottom: 0px !important; margin-left: 0px !important; max-height: 2000px; min-width: 0px; border-style: initial; border-color: initial; font-style: normal; font-weight: normal; font-family: 'trebuchet ms', arial, helvetica, sans-serif; line-height: normal; background-color: transparent; width: 14px; min-height: 12px; padding-top: 1px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; text-decoration: none; vertical-align: top; display: inline; background-repeat: no-repeat no-repeat;"/></a> about venture capitalists, for example. As does <a href="http://www.crunchbase.com/person/chris-dixon" target="_blank" style="color: rgb(0, 159, 0); text-decoration: none; font-weight: bold;">Chris Dixon<img src="http://i.ixnp.com/images/v6.40/t.gif" style="border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; border-style: initial; border-color: initial; float: none; max-width: 2000px; margin-top: 0px !important; margin-right: 0px !important; margin-bottom: 0px !important; margin-left: 0px !important; max-height: 2000px; min-width: 0px; border-style: initial; border-color: initial; font-style: normal; font-weight: normal; font-family: 'trebuchet ms', arial, helvetica, sans-serif; line-height: normal; background-color: transparent; width: 14px; min-height: 12px; padding-top: 1px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; text-decoration: none; vertical-align: top; display: inline; background-repeat: no-repeat no-repeat;"/></a>. And <a href="http://www.crunchbase.com/person/jason-calacanis" target="_blank" style="color: rgb(0, 159, 0); text-decoration: none; font-weight: bold;">Jason Calacanis<img src="http://i.ixnp.com/images/v6.40/t.gif" style="border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; border-style: initial; border-color: initial; float: none; max-width: 2000px; margin-top: 0px !important; margin-right: 0px !important; margin-bottom: 0px !important; margin-left: 0px !important; max-height: 2000px; min-width: 0px; border-style: initial; border-color: initial; font-style: normal; font-weight: normal; font-family: 'trebuchet ms', arial, helvetica, sans-serif; line-height: normal; background-color: transparent; width: 14px; min-height: 12px; padding-top: 1px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; text-decoration: none; vertical-align: top; display: inline; background-repeat: no-repeat no-repeat;"/></a>.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">The VCs, for their part, fight back more quietly. They point out that very few angel funded startups end up very big or interesting. <em>“An entire generation of entrepreneurs are building dipshit companies and hoping that they sell to Google for $25 million,”</em> lamented a venture capitalist to me recently. He believes that angel investors are pushing entrepreneurs to think small, and avoid the home run swings. And you don’t get a home run unless you swing hard, he says. When you play it safe you nearly always lose.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">I <a href="http://www.avc.com/a_vc/2010/07/lead-investors-dipshit-companies-and-funding-every-entrepreneur.html" target="_blank" style="color: rgb(0, 159, 0); text-decoration: none; font-weight: bold;">repeated<img src="http://i.ixnp.com/images/v6.40/t.gif" style="border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; border-style: initial; border-color: initial; float: none; max-width: 2000px; margin-top: 0px !important; margin-right: 0px !important; margin-bottom: 0px !important; margin-left: 0px !important; max-height: 2000px; min-width: 0px; border-style: initial; border-color: initial; font-style: normal; font-weight: normal; font-family: 'trebuchet ms', arial, helvetica, sans-serif; line-height: normal; background-color: transparent; width: 14px; min-height: 12px; padding-top: 1px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; text-decoration: none; vertical-align: top; display: inline; background-repeat: no-repeat no-repeat;"/></a> this argument recently for the fun of it at a Y Combinator event for aspiring angel investors. You can imagine that it wasn’t much of a crowd pleaser. Y Combinator, which has spawned some 200 plus startups in just a few years, could be considered the king of this ecosystem, I said.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">Whether there’s merit to the argument or not, it is relevant to the entire ecosystem. Some venture capitalists think that this “think small” attitude is driving entrepreneurs who may otherwise build the next Google or Microsoft to create something much less interesting instead, and then everyone loses. No IPO. No 20,000 tech jobs. No new buyer out there for the startups that don’t quite make it.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">And without those occasional but huge exits, the entire ecosystem can fail. Venture firms need big returns to raise new funds. Without venture money a lot of the innovation in Silicon Valley would end.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">So in effect, the argument goes, the angel investors are like a quickly growing cancer. Without radically invasive surgery, Silicon Valley will eventually flatline.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">Dramatic? Yes. But now many of those angel investors are raising big funds and are starting to look like those old style venture capitalists. McClure has a $30 million fund. Dixon has a $50 million fund. <a href="http://www.crunchbase.com/person/mike-maples" target="_blank" style="color: rgb(0, 159, 0); text-decoration: none; font-weight: bold;">Mike Maples<img src="http://i.ixnp.com/images/v6.40/t.gif" style="border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; border-style: initial; border-color: initial; float: none; max-width: 2000px; margin-top: 0px !important; margin-right: 0px !important; margin-bottom: 0px !important; margin-left: 0px !important; max-height: 2000px; min-width: 0px; border-style: initial; border-color: initial; font-style: normal; font-weight: normal; font-family: 'trebuchet ms', arial, helvetica, sans-serif; line-height: normal; background-color: transparent; width: 14px; min-height: 12px; padding-top: 1px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; text-decoration: none; vertical-align: top; display: inline; background-repeat: no-repeat no-repeat;"/></a> and <a href="http://www.crunchbase.com/person/chris-sacca" target="_blank" style="color: rgb(0, 159, 0); text-decoration: none; font-weight: bold;">Chris Sacca<img src="http://i.ixnp.com/images/v6.40/t.gif" style="border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; border-style: initial; border-color: initial; float: none; max-width: 2000px; margin-top: 0px !important; margin-right: 0px !important; margin-bottom: 0px !important; margin-left: 0px !important; max-height: 2000px; min-width: 0px; border-style: initial; border-color: initial; font-style: normal; font-weight: normal; font-family: 'trebuchet ms', arial, helvetica, sans-serif; line-height: normal; background-color: transparent; width: 14px; min-height: 12px; padding-top: 1px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; text-decoration: none; vertical-align: top; display: inline; background-repeat: no-repeat no-repeat;"/></a> as well. <a href="http://www.crunchbase.com/person/aydin-senkut" target="_blank" style="color: rgb(0, 159, 0); text-decoration: none; font-weight: bold;">Aydin Senkut<img src="http://i.ixnp.com/images/v6.40/t.gif" style="border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; border-style: initial; border-color: initial; float: none; max-width: 2000px; margin-top: 0px !important; margin-right: 0px !important; margin-bottom: 0px !important; margin-left: 0px !important; max-height: 2000px; min-width: 0px; border-style: initial; border-color: initial; font-style: normal; font-weight: normal; font-family: 'trebuchet ms', arial, helvetica, sans-serif; line-height: normal; background-color: transparent; width: 14px; min-height: 12px; padding-top: 1px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; text-decoration: none; vertical-align: top; display: inline; background-repeat: no-repeat no-repeat;"/></a> just raised a <a href="http://online.wsj.com/article/SB10001424052748703321004575427840232755162.html?mod=WSJ_Tech_LEFTTopNews" target="_blank" style="color: rgb(0, 159, 0); text-decoration: none; font-weight: bold;">$40 million<img src="http://i.ixnp.com/images/v6.40/t.gif" style="border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; border-style: initial; border-color: initial; float: none; max-width: 2000px; margin-top: 0px !important; margin-right: 0px !important; margin-bottom: 0px !important; margin-left: 0px !important; max-height: 2000px; min-width: 0px; border-style: initial; border-color: initial; font-style: normal; font-weight: normal; font-family: 'trebuchet ms', arial, helvetica, sans-serif; line-height: normal; background-color: transparent; width: 14px; min-height: 12px; padding-top: 1px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; text-decoration: none; vertical-align: top; display: inline; background-repeat: no-repeat no-repeat;"/></a> fund, notes the WSJ. And <a href="http://www.crunchbase.com/person/jeff-clavier" target="_blank" style="color: rgb(0, 159, 0); text-decoration: none; font-weight: bold;">Jeff Clavier<img src="http://i.ixnp.com/images/v6.40/t.gif" style="border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; border-style: initial; border-color: initial; float: none; max-width: 2000px; margin-top: 0px !important; margin-right: 0px !important; margin-bottom: 0px !important; margin-left: 0px !important; max-height: 2000px; min-width: 0px; border-style: initial; border-color: initial; font-style: normal; font-weight: normal; font-family: 'trebuchet ms', arial, helvetica, sans-serif; line-height: normal; background-color: transparent; width: 14px; min-height: 12px; padding-top: 1px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; text-decoration: none; vertical-align: top; display: inline; background-repeat: no-repeat no-repeat;"/></a> is raising a big fund of his own.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">All of these guys previously invested their own money in small chunks that weren’t threatening to VCs. All are now investing much larger amounts of other people’s money in startups. They are most definitely putting pressure on the old guard.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">What’s the cutoff? Around $500,000, says <a href="http://www.crunchbase.com/person/ron-conway" target="_blank" style="color: rgb(0, 159, 0); text-decoration: none; font-weight: bold;">Ron Conway<img src="http://i.ixnp.com/images/v6.40/t.gif" style="border-top-width: 0px; border-right-width: 0px; border-bottom-width: 0px; border-left-width: 0px; border-style: initial; border-color: initial; border-style: initial; border-color: initial; float: none; max-width: 2000px; margin-top: 0px !important; margin-right: 0px !important; margin-bottom: 0px !important; margin-left: 0px !important; max-height: 2000px; min-width: 0px; border-style: initial; border-color: initial; font-style: normal; font-weight: normal; font-family: 'trebuchet ms', arial, helvetica, sans-serif; line-height: normal; background-color: transparent; width: 14px; min-height: 12px; padding-top: 1px; padding-right: 0px; padding-bottom: 0px; padding-left: 0px; text-decoration: none; vertical-align: top; display: inline; background-repeat: no-repeat no-repeat;"/></a>, probably the most successful angel investor in Silicon Valley history. Above that and the VCs see you as competition. Conway has stayed well below that threshold, and his companies regularly go on to raise traditional venture rounds from venture capitalists.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">All of this competition is good for the individual entrepreneur looking for capital. Most of the bottlenecks have been removed, and it’s easier for a good idea to attract the cash it needs. But I think there is some merit to the idea that too many entrepreneurs are thinking small these days. Which is fine in a vacuum. But if big companies aren’t being built because of this small thinking, we’ll all suffer sooner or later.</p>
<p style="line-height: 19px; margin-top: 1em; margin-right: 0px; margin-bottom: 1em; margin-left: 0px;">So think big. And be mindful of the politics when you raise that angel round</p>
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