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Showing posts from September, 2004

ICICI Venture plans to get even bigger

A $22 million plus investment to buy out the Tatas from their Yellow Pages publishing company (now called Infomedia India Limited); a $16 million investment in terry towel maker Welspun India; $11.4 million in TV picture tube maker Samtel; a 54% stake in clothing retailer Arvind Brands; a $4.3 million mezzanine investment - the first of its kind in India - in pharma firm ArchCommerz, etc., etc. Add to this talk of serious investments in the real estate sector and even co-investing with the big daddies of buyouts like KKR.

ICICI Venture’s investments in 2004 are certainly complex. And BIG. Business Standard attempts to profile I-Venture in its new avatar

The Vinod Khosla difference

Extracts from Joe Kraus, co-founder of search engine company Excite, recent 2-part blog post - here and here - (on the importance of persistence) provide a good idea why Vinod Khosla of Kleiner Perkins' is considered "an entrepreneur's dream VC":

While we were still in the garage (literally), we met with at least 15 different venture capital firms. The meetings we're all the same. We showed them our search technology, showed them "concept-based" search, and showed them targeted advertising. To a firm, the first question they asked was a very reasonable one: 'great stuff guys, but what's your business plan? how are you going to make money?' Of course, being 22 years old and fresh out of college we replied, 'we thought you could help us out with that.' Apparently, that's the wrong answer. Who knew?

Rinse, lather, repeat.

Then we met Vinod...

By then, our deal had developed a certain "smell" -- smart guys with interesting…

Brazil targets $2-B in IT exports by 2007

Extracts from an interview given by Luiz Fernando Furlan, Brazil's Minister of Development, Industry & Foreign Trade, to BusinessWeek magazine:


We have a target to improve our IT exports to $2 billion in 2007 -- software and services. Now it's $100 million. It's very ambitious. But the private sector tells us it's possible....

We have all the conditions to be a player in the world software market. We have a good infrastructure of telecommunications and energy. We have the domestic market. We have more than 6,000 PhDs in technology coming out every year. The cost of production in Brazil is much lower than U.S., Europe, and Japan. We can deal with Europe and Japan in the daylight.

We're the sixth- or seventh-largest market for software worldwide. We have an $8 million market for software...

We're building up our own model. We have seen Ireland, India. We look at other countries. We can't buy a canned model. We have a base already.

How Vinod Khosla created Sun Microsystems

While I knew the one line description "Vinod Khosla was the founding CEO of Sun Microsystems and was earlier part of the founding team at Daisy Systems", I hadn't come across a more detailed version of Khosla's pre-KPCB exploits before Joe Kraus talked about it on his blog.

Here are some extracts from the Harvard Business School case study (by Dr. Amir Bhide) that I found interesting:

How a Stanford secretary "linked up" SUN's co-founders:

I'm probably more of a conceptual engineer, and I can draw block diagrams for almost anything I can think of, but I can almost never implement them. So I started looking for someone who had done this kind of stuff before. I heard of a project at Stanford called the Stanford University Network, or Sun.workstation project. I called the computer science department, and some secretary who did not want to bother a professor gave me the uame of a graduate student from Germany, Andy Bechtolsheim.

Apparently, Andy, who w…

An argument for sweat equity friendly laws

In an article appearing in the Financial Express, Dr. Y.R.K.Reddy, Chairman, Yaga Consulting Pvt. Ltd., provides strong arguments on why the Indian government's department of company affairs and SEBI must simplify the rules relating to the issue of sweat equity. "The current rules and guidelines are so elaborate that they may meet the ideals of corporate governance and yet are revoltingly cumbersome. They are indeed an over-kill," he says

Click Here to read the full article.

Is Bangalore shooting itself in the foot?

Bangalore's increasingly intolerable infrastructure problems and the sky-rocketing salary expectations of its residents seem to be achieving what economic recession and the "outsourcing backlash" in the US, failed to achieve: spell the decline of IT industry in the city.

Yup. Hyderabad's emergence as a serious competitor has not really dented Bangalore's ability to attract MNCs and Silicon Valley start-ups. Bangalore's original advantages - weather, cosmopolitan culture, "critical mass" and "network effect", etc., etc. - continue to work in its favor.

However, the knowledge that these companies have of Bangalore is often second hand. Wipro and Infosys - the city's original "crown jewels" - are better "lead indicators". Whether they say it explicitly or not, it is clear these companies are expanding faster in other cities than in their "home town".

Venture capitalists based in Bangalore too have been murm…

Incubation programs at IIIM-Bangalore and IIT-Delhi

Financial Express has published a short profile of incubation programs at IIM-Bangalore and IIT-Delhi.

Extract:

IIM-Bangalore

IIM-Bangalore, which started its incubation facility in 2000, has so far seen three IT companies being incubated.

“Nine Cloud Entertainments, SeNate Communications and Voice Tech Solutions are working at our centre,” said Dr Mathew Manimala, professor of organisational behaviour and chairperson for Jamuna Raghavan Entrepreneural Academy.

Nine Cloud Entertainments is working on animation and other entertainment projects. SeNate Communications is developing firewall security solutions while Voice Tech Solutions provides IT solutions to the telecom companies. Usually, we give one-year term for incubations. Sometimes, depending upon projects, we might extend it to one-and-half years,” said Dr Manimala.

So far, two companies Meta-I Systems and EmbedX Systems Pvt Ltd have exited and started out their own operations after being incubated at IIM-Bangalore. “Meta-I was …

Wipro Vice-Chairman Vivek Paul profiled in San Jose Mercury News

Some extracts:

The 45-year-old Paul, a graduate of India's Birla Institute of Technology who earned a master's degree in business administration from the University of Massachusetts, is an unapologetic believer in the virtues of making U.S. companies more efficient through offshoring -- an activity that at the same time helps raise living standards in his impoverished homeland. But he also expresses compassion for the American workers who lose out in the bargain...

...Paul lives with his wife and three young children in Los Altos, working out of the company's U.S. sales office in San Carlos about a third of the time. He splits the rest of his time on the road managing Wipro's global operations and running the company out of its headquarters in Bangalore. Tall and trim, he is an inveterate jogger and swimmer who says he avoids playing golf with business associates...

...Paul concedes there are legitimate concerns fueling the backlash against offshoring. He bemoans the r…

Sand Hill Road gets blogging

By Arun Natarajan

"Man has Venture Blogging come a long way since we started VentureBlog a year and a half ago. At that time, the only way that there would be robust discussion and debate about venture capital related topics in the blogsphere would be if Andrew and I took different sides of an issue and duked it out on VentureBlog. Now folks like Brad Feld from Mobius Venture Capital and Fred Wilson from Flatiron Partners are discussing and debating VC issues of real interest and import. While Venture Capital still remains quite individualistic and, at times, enigmatic, VC bloggers have gone a long way to help demystify what has for years been a bit of a black art"

- David Hornik of August Capital in VentureBlog (August 27, 2004)

Venture Capitalists in the US are taking a strong liking for blogging. As Hornik has pointed out, from just a couple of active VC bloggers two year ago, there are now well over a dozen VCs who blog regularly. Not stopping there, VCs have also started …

Remaining awake: the secret to a VC's success

Here's what Michael Moritz had to say on the "secret" of Sequoia Capital's success during the Silicon Valley 4.0 conference (via Always-On):

On the whole we've had the incredible benefit of having been investors in a whole slew of companies over the years. And if you're an investor and you remain awake and alert to the possibilities of tomorrow, those companies inevitably wind up as lamplighters that illuminate the future.

...if you're an investor in Apple Computer, to knowing what the shortcomings were to using cassette tape as a storage mechanism for personal computers in the late 1970s, to understanding the implications of what disk drives could do for personal computers.

So Sequoia went ahead and invested in a couple of disk drive companies. And if you invest in a disk drive company, why, you're alert to the importance of the magnetic heads inside a drive company, so you invest in those. And if you're an investor in a PC company and disk drive…

Can WebEx avoid Netscape's fate?

As Microsoft takes time to digest web-conferencing company PlaceWare, the market leader - Subrah Iyer-founded WebEx Communications - has been picking up more momentum and market share. But can WebEx sustain the lead?

"WebEx hasn't been steamrolled--yet--but Microsoft's plans for an upcoming version of Web conferencing software makes clear the extent to which it uses more established products to gain a foothold in new markets," warns
an article in Forbes.

What VCs require from angels

"Writing a check is the first, and perhaps easiest, part. Yet angels-most of whom are themselves seasoned business executives, entrepreneurs, technologists and finance people-can do the venture community the greatest good by not just writing that check, but by stepping in and prepping the company for sustainable company growth," says Ravi Chiruvolu, a general partner with Charter Venture Capital, in an open letter to angel investors. Chiruvolu seeks to "cross (the) chasm of misalignment between what VCs really want and what angels often fail to provide" through his letter which appears in his column for Venture Capital Journal.

In April, VCJ had carried a Cover Story titled "Angels or Devils?" in which it has outlined the problems faced by VCs when it comes to funding companies which had received investments from angels.

An extract:

"VCs still have a bad taste in their mouths from five years ago, when everyone and his grandmother wanted to invest in …