Benjamin Kuo’s Blog

It’s the first real work day of September, the traditional re-opening of the venture capital funding season. VC fundings — which typically tail off in August due to the vacations of many a managing director — usually start kicking back into gear this month. CEOs are dusting off those term sheets, warming up their iPhones, and sending off emails as I type this, when (finally!) all those venture capitalists they have been trying to get in a room are finally back from their long sunny days in Europe or at the beach.

The question is, will VCs be as open with their investments going into this season as they were last year? I’ve been speaking with both venture firms and angel investors, and I’ve heard muttering about lack of quality deals; concern about the economy; worries about lots of “me too” Web 2.0 investments; not to mention lots of time being spent on later round companies, along with a closed IPO window. It seems like this might have shown up in the numbers: our tracking shows that there was a steep dropoff in announced venture deals in August of this year (10 deals, versus 33 deals for August of 2007). On the other hand, I see investors who are very happy to have found some great technology and/or Internet deals and companies they are about to fund, lots of experienced (second-time-around) executives now at new startups, and CEOs who are saying it’s been much easier in recent months to find investors interested in their companies.

It’s tough to call, however whatever the result, it will be interesting to see if we continue to see a lackluster number of venture deals like we did in August, or if September will see a new surge in closed fundings.

This entry was posted on Tuesday, September 2nd, 2008 at 9:19 am and is filed under Venture Capital. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.