Greek Complexity

Corporate venturing activity ramping up

In just the past 6 weeks or so, I've spoken to five different large corporations with newly launched corporate venture capital operations. Is this just a coincidence or a true trend? Seems like a trend though unscientific, of course.

Let's be clear: each of these has slightly different structures and need to satisfy fairly different goals, such as

• Capital gains
• As a path to future acquisitions
• Understanding what new innovative technologies and companies are out there
• Helping to seed a market for their own products

...and so on, with set-ups such as

• Extensions of the existing M&A department
• Wholly owned venturing arms funded with balance sheet money on an as-needed basis
• Capital ring-fenced specifically for venturing and handed to a professional manager
• R&D or strategic marketing personnel double-hatting as investment managers

Entrepreneurs who seek or are sought out by corporate venturing arms should understand the differences between each approach.

If a trend is truly taking hold, this would mark probably the first renewal of the corporate venturing scene since the dotcom bust. I worked on an academic research project just after the bust to investigate the motivations of corporate venture firms. At that time, corporations were just as caught up in the dotcom frenzy as VCs, entrepreneurs and the general public, but most of them shut down their venturing arms soon after. We'll have to see whether the current trend will prove to be more sustained. It's certainly a possibility, not least because capital markets are currently much more circumspect than they were a decade ago.

Money, Money, Money. Can we talk about something else?

http://www.nytimes.com/2012/09/16/opinion/sunday/money-money-money-can-we-talk-about-something-else.html?_r=2&pagewanted=1&ref=opinion

I wonder if the writer knows anything about Singapore. Probably does, to his chagrin. Separately, does anyone think there's scope to run a successful time bank in Singapore?

Inside the VC's mind (episode trois)

Episodes un and deux were posted quite a while back. Here comes episode trois. This one isn't actually one of my own posts. It's by Mark Suster. Some of it overlaps with what I said earlier (none of this is rocket science, really), and the bit I agree most with is "VCs want big outcomes". Note, as he makes clear, that not every point he makes is relevant to every single VC out there. There are variations galore, even in a place like Silicon Valley, and even more so in the much more diverse, much less established region that is Asia.

Take a read: Do You Really Even Need VC?

Amazon ‘robo-pricing’ sparks fears

http://www.ft.com/intl/cms/s/0/26c5bb7a-c12f-11e1-8179-00144feabdc0.html#axzz203wH4FvI

Not good: “[Product] pricing is becoming like equity trading, with real-time reflection of supply and demand, increasingly sophisticated rules, and all the consequences for unexpected results.”

Starting a Bank

http://ma.tt/2009/08/starting-a-bank/

Ripping apart and rebuilding the idea of banking

Capitalism's Crises

This isn't a macroeconomics blog (what blog is it?) but this video was sufficiently thought-provoking that I thought it a must-post:

The speaker is the academic David Harvey.

Contrasting the Venture Capital model across Asia

I was invited to speak at a small conference on venture capital and private equity last week, organised by NUS, one of Singapore's universities. Not knowing exactly who the audience was and suspecting it was mainly students interested in learning about venture capital, I kept my material fairly generic.

Here's what I presented. It's meant to be talked through, not read, but you get the gist of it.

Once the presentation opens, click More and Full Screen.

Original here: Contrasting the Venture Capital model across Asia

Prospectus for Silicon Valley’s Next Hot Tech IPO, Where Nothing Could Possibly Go Wrong.

http://www.mcsweeneys.net/articles/prospectus-for-silicon-valleys-next-hot-tech-ipo-where-nothing-could-possibly-go-wrong

Funny! With plenty of digs at venture capitalists!

‘Buffett rule’ is a sorry excuse for tax reform

http://www.ft.com/cms/s/0/b5ea9df2-83c7-11e1-82ca-00144feab49a.html

No, this isn't written by a rah-rah Republican. It's also not hard to follow his argument, except his prescription to abolish corporate income tax so as to avoid the double taxation of dividends. Surely it would be better instead to exempt dividend income from taxes, given that there are plenty of companies who don't pay out dividends (as Buffett himself prefers).

Links of the, well, many days

For some reason, my little ifttt hack didn't work and the articles I bookmarked onto my radar over the past several days didn't actually make it to the blog. No matter. I emailed them. I'm sure they'll reply with a fix.

Meanwhile, here are some of the things I posted to my radar since my last blog post. If you get my email newsletter, you've already seen most of these. I'll disable the double-posts once the ifttt problem is fixed.

• Why Germany is phasing out nuclear power
• The Revenge of Wen Jiabao
• America’s dream unravels
• Has E-commerce Really Fallen Out Of Favour With Indian VCs?
• 7 Ways to Automate Your Life With ifttt: I still love ifttt even though it didn't work for me.
• Procreation vs. Overpopulation: The case against kids: This piece doesn't try to be as conclusive as its title pretends.
• Online behaviour: March of the tastemakers: From interests to the social graph to the interest graph. Things come full circle.
• The Credit Card Is The New App Platform
• How to Avoid Getting Fired from Your Own Startup: Article doesn't really match the title. Still interesting.
• Investors demand change at ailing techs: Interesting to see moves reminiscent of private companies playing out in listed companies

This is one of those few times I've actually sat down and looked at the kinds of stuff I post on the radar. Quite a hodge-podge. Plus there's stuff I read but don't post. Wonder how much my radar overlaps with other people's.