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The FilmLoop-Comventures Saga

Posted on Tuesday, Feb 13th 2007

Techcrunch has come out with a story accusing Comventures about unethical practices in pulling the plug on Filmloop, and forcing them to be folded into Frabrik, one of their better performing portfolio companies.

Unfortunately, the villain of this story is a guy called Keyur Patel.

Keyur has had a string of successful turnarounds under his belt, Inktomi and Maxtor to name a few, and ComVentures, under pressure from their Limited Partners, has brought Keyur in to clean up the portfolio, and change the mix of investments into something that makes sense.

The history of Comventures is, as the name suggests, in Communications and Networking. However, “Comm” has been, by and large, a dead segment for venture of late. Comventures has thus been struggling.

Enter Keyur Patel. Portfolio clean-up is in the order.

Filmloop, which, as Michael Arrington himself has said before, has been a deadpool company, and whether or not they had $3-$5 Million still in the bank, the fact that their investors don’t want them to spend that money in prolonging their death – how is that a bad decision?

Is this the first time that VCs have decided not to send good money after bad?

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[…] This week, ComVentures has gotten into trouble by trying to roll up several companies in its portfolio into one that is performing relatively well. If you missed this little soap opera, you can catch up here, here, and here. […]

Sramana Mitra on Strategy » Blog Archive » Web 3.0: More Roll-Ups To Come Thursday, February 15, 2007 at 10:48 AM PT

You’re on to something here. Looks like Keyur Patel forces Filmloop sale at less then book value to a company he is a chairman and one of the founders… Wow, the very least it smells common shareholder’s lawsuit. Unless somebody tips DA.

Jungle Valley Friday, February 16, 2007 at 1:18 PM PT

Yeah, this is a great example of how greedy VC firms such as COMVentures earn the name vulture capitalists. Pick your partners well, and do not pick people like COMventures.

Ron Thursday, June 28, 2007 at 10:14 AM PT