The Venture Intelligence Blog

Anand Sanwal of CB Insights believes they are. Extract from his recent newsletter article . When I see a big corporation launch a buzzwordy accelerator program, I hear the sound of money getting flushed down the toilet. They launch these to get some buzz/look cool and, in theory, support and learn from startups. But here's the rub: if you're a giant, slow-moving company not known for being particularly innovative, the startups attracted to your accelerator are going to be 2nd or 3rd tier.  ..That said, if you are focused on trying to "look innovative," here is the full list of tactics..:  * Build a startup-y office with an open floor plan, showers, and an Xbox/Playstation...  * Launch an innovation lab or accelerator. It doesn't matter what it does (if anything) — but do this.  * Tell people that you don't wear suits and that you wear jeans to work. Venture Intelligence is the leading provider of data and analysis on Private Company Financials, Tra...

Stanford's Steve Blank believes that, with his methodology, VCs can do to start-up investments what Brad Pitt (in the movie Moneyball) did to baseball management. We focus on evidence and trajectory across the business model. Flashy demo days are great theater, but it’s not clear there’s a correlation between giving a great PowerPoint presentation and a two minute demo and building a successful business model. Rather than a product demo – we believe in a “Learning Demo”. We’ve found that “Lessons Learned” day showing what the teams learned along with the “metrics that matter” is a better fit than a Demo Day. “Lessons Learned” day allows us to directly assess the ability of the team to learn, pivot and move forward. Based on the “lessons learned” we generate an Investment Readiness Level metric that we can use as part of our “go” or “no-go” decision for funding. ...The collective wisdom of venture investors (including angel investors, and venture capitalists) over the past decade...

Mukund Mohan of Microsoft Ventures has a numbers-based post on the probability of funding and the equity dilutions Indian entrepreneurs face depending on whether they go to an Accelerator first versus VCs and Angel Investors. The first scenario for you, the entrepreneur, is to get funded directly by a VC . The chances of that happening in India are low – 1.4%.  The other challenge is that those companies got relatively poor valuations (average about $1.4 Million pre money). Only 19 out of 1300 entities got funded last year to raise their series A through a VC directly. In this case you will possibly dilute 30-40% and still own >60% of the company . I have used 30% dilution in the chart below. The second scenario is to get angel funding and then in 18 months get VC funding. The chances are better that you might go through this scenario (2X more – 43 companies got angel funded last year), and then venture funding. You will end up owning 56% of your company (by g...

Another fun show. McClure mentions during the interview how and why 500 Startups is headed to India (and is skeptical of China).     Venture Intelligence is the leading provider of data and analysis on private equity, venture capital and M&A transactions in India as well as Financials & Valuations of Private Companies in the country. Click Here to view our products list including the Free Deal Digest Weekly: India's First & Most Exhaustive Transactions Newsletter.

Dear Colleague, In 2004, the buzz around one mega exit - of Private Equity investor Warburg Pincus from Bharti Airtel - got institutional investors across the world excited about the Indian Private Equity opportunity. Naturally, there was a boom in PE fund offerings from India- typically focused on minority growth capital type investments - to cater to this rising appetite. And billions of dollars flowed in search of the next big Bharti. Now, in one forum after another, these investors - "Limited Partners" (investors in PE/VC funds, LPs for short) - have been hyper critical of Indian PE fund managers for their lacklustre returns. Indian PE sure seems to have hit rock bottom. Is There Hope? Admidst a lot of skepticism, the BSE Sensex was the best performer among emerging markets (aka BRICs) in 2012 after being the worst performer in 2011. Recent months have seen MNCs from Europe to Japan and, of course, the US -  in their almost desperate search for gro...