1Mby1M Virtual Accelerator Investor Forum: With Heidi Roizen of DFJ (Part 1)

Responding to a popular request, we are now sharing transcripts of our investor podcast interviews in this new series. The following interview with Heidi Roizen, DFJ was recorded in March 2016. 

Heidi Roizen, Operating Partner at DFJ, discusses her important article, “How to Build a Unicorn From Scratch – and Walk Away with Nothing,” and imparts crucial lessons to entrepreneurs on how to look at terms in a venture financing situation.

Sramana Mitra: We have been living in world of unicorn mania. We have tried to put some perspective on this issue. There are good sides to the unicorn mania. There are bad sides to the unicorn mania. Let’s start with one

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1Mby1M Virtual Accelerator Investor Forum: With Jake Seid of Stone Bridge Ventures (Part 4)

Sramana Mitra: I’m surprised that you haven’t talked about selling when these very high level of investments start coming into a company. Sometimes it’s not just companies that are not just doing well. Sometimes if a company is a hot company, the trend has been to raise huge amounts of money.

There are risks raising that kind of money because valuations can get way ahead of themselves. Then in the follow-on round, you start running into down rounds and liquidation preferences. That’s where the seed investors get screwed. One of the ways a lot of seed investors protect themselves is when that kind of dynamic sets in, they sell and do not remain. >>>

1Mby1M Virtual Accelerator Investor Forum: With Jake Seid of Stone Bridge Ventures (Part 3)

Sramana Mitra: Your point about the fund sizes being larger and mitigating the later stage pro rata opportunity is well taken. I’m going to elaborate on my question. There is a lot of competition to get into some of the deals for Series A and Series B.

If you look at the numbers, there are 50,000 to 70,000 seed stage investments a year versus 1,200 to 1,500 Series A investments. Clearly there’re a lot of companies in that pool that are not getting to Series A. Only a percentage of those are really these hot companies. The hot companies, by definition, are few and far between, which is why there is such a competition. All that is anomalies. There’re a lot of companies in the middle. >>>

1Mby1M Virtual Accelerator Investor Forum: With Jake Seid of Stone Bridge Ventures (Part 2)

Sramana Mitra: What about geography? What’s your preference?

Jake Seid: Proactively, I’m focused on Silicon Valley and outside of Silicon Valley opportunistically.

Sramana Mitra: Talk about your current portfolio. What are the highlights? What have you invested in? How do you decide what you have chosen to invest in?

Jake Seid: We look at great teams, big markets, and differentiated technologies. Taking that at a >>>

1Mby1M Virtual Accelerator Investor Forum: With Jake Seid of Stone Bridge Ventures (Part 1)

Responding to a popular request, we are now sharing transcripts of our investor podcast interviews in this new series. The following interview with Jake Seid of Stone Bridge Ventures was recorded in November 2017. 

Jake Seid, Managing Director, Stone Bridge Ventures, talks about trends, AngelList Syndicates, ICOs and more.

Sramana Mitra: Tell us about Stone Bridge Ventures. What is the focus of the firm? How big is the fund? What size investments do you like to make?

Jake Seid: This is a vehicle that I formed after my time as President of Ten-X. When I moved to the advisory board, I saw a >>>

12 Investors Discuss Unicorn Mania via the Virtual Accelerator Investor Forum

Right now there is a lot of capital in the startup investment system. Investors managing a good amount of money have to think of an investment thesis where they can really get returns. One of the observations I’ve had is that if everybody is chasing Unicorns, it’s not going to work, because there aren’t that many Unicorns. Unicorns, by definition, should be rare. Right now, we have a lot of pseudo-unicorns because a lot of artificially-bloated companies have come into the market. In the private market, there are tons of artificially bloated pseudo-unicorns. This aggressive goal of trying to invest in Unicorns is not going to end very well. There’s going to be a lot of casualties in the process.

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1Mby1M Virtual Accelerator Investor Forum: With Venktesh Shukla of TiE Angels (Part 5)

Sramana Mitra: There is actually a pre-seed problem. There were 70,000 companies that received some sort of early-stage financing. In the last few years, these numbers have been very high but the number of companies that get venture financing remains at 1,200 or so.

In the middle where there are companies that have crossed over to being credible companies, that set of companies is actually much lower. A lot of companies are getting funding from, for a lack of better word, dumb investors who don’t know what they’re doing and just writing checks and creating a glut in the funnel. But it’s in the middle where you have good companies. >>>

1Mby1M Virtual Accelerator Investor Forum: With Venktesh Shukla of TiE Angels (Part 4)

Sramana Mitra: Of your ventures that have raised venture money, have they raised venture money from these $75 million to $100 million funds, or have they raised money from the bigger funds?

Venktesh Shukla: They typically raise money from bigger funds because these are big spaces. One of them was how do you handle structured and unstructured data. Every company in the world has that problem and there is no solution. With the onset of predominantly mobile access, the old networking problems haven’t gone away. The new ones have piled on top of that.

Using machine learning, how do you isolate the problem when somebody complains that he’s seeing poor responsiveness? That’s a new category of problem. The third one is how do you create a virtual private cloud in minutes. The traditional route of >>>