News > Venture Capital

VC-backed tech IPO data makes for grim reading
Venture Capital
<p>Square’s value soared as much as 64% on its market debut on Thursday, beating expectations following a lacklustre pricing. While the payments startup’s debut was not as bad as feared, recent data shows the overall state of venture capital-backed tech IPOs probably is.</p> <p>Data published by CB Insights shows that, in the last three years since Facebook’s May 2012 IPO, U.S. VC-backed tech IPOs have returned a mere 7.05% on average. By comparison an equal weight S&amp;P 500 ETF returned 67% over the same period.</p> <p>In short, if you invested in the S&amp;P 500, your return would be 8x higher than if you had backed every single VC-backed tech IPO over the same period.  </p> <p>This is largely thanks to the rise of the “private IPO”. With tech startups seeking higher valuations in order to raise more and more cash through private-mega rounds, many are finding that by the time they list most of the returns have been squeezed out. Now we are beginning to see the fallout.<br /> Photo: Alison E Dunn<br /> &nbsp;</p>
VC-backed startup angers hackers for ‘helping’ IS
Venture Capital
Startups are all about solving problems. But what if solving that “problem" also gets you accused of helping terrorists? This is  the dilemma facing security software startup CloudFlare, and the problem is DDoS (distributed denial of service) attacks. A DDoS attack is an attempt to shutdown a website by overwhelming it with traffic from an army of virtual computers. It's&hellip;
What slowdown? China TMT deals soar in the first half
Venture Capital
Faltering growth in China seems to be having little impact on venture capital's appetite for the country’s tech space, as investments for the first half of this year touch $8 billion - more than 2014’s full year total. The data – enclosed in a new report by PWC – shows that deal value and volume in the mobile and telecoms,&hellip;
Spiderman advises new fund
Venture Capital
Tobey Maguire is putting his Spidey sense to use, connecting his Hollywood buddies with a new venture capital fund. Joe Lonsdale, young tech giant and founder of the now closed Formation 8 fund, has grabbed Maguire as an advisor for his latest fund, reports the New York Post. The $50 million Eight Partners Fund 1 is investing in early-stage tech&hellip;
Video: The two basic needs for a startup looking to launch overseas
Venture Capital
<p>Most startups don't know how to get started when it comes to expanding overseas, says Shayne Veramallay, venture pipeline manager for DLA Piper. In an interview with NexChange, Veramallay offers two suggestions.</p>
The great global taxi war continues: India's Ola raises $500M
Venture Capital
All of over the world it seems taxi app unicorns are locking horns with Uber in a war for market share. The latest battleground: India. Ola -- a ride-sharing app behemoth that gobbled its rival TaxiForSure earlier this year -- says it has just closed a $500 million Series F (!) round of funding. The investor roster holds no surprises.&hellip;
Video: 'Me-too' startups face challenges in raising money; West Coast dreams big
Venture Capital
<p>The market is becoming saturated with "me-too" startups and are facing an uphill battle when it comes to fundraising, says Shayne Veramallay, venture pipeline manager for DLA Piper. In an interview with NexChange, Veramallay contrasts trends on the East Coast and West Coast.</p>
Dislike this: Andreessen sold 75% of his Facebook shares
Venture Capital
Marc Andreessen essentially unfriended Mark Zuckerberg IRL, dumping about three-fourths of his Facebook shares in the last two weeks. Facebook's stock dropped almost 3% with the news Monday, reports Business Insider. Andreessen sold 1.5 million shares, valued at about $160 million, beginning October 30. It's not unusual for initial venture capital backers to sell their shares of a company during&hellip;
Dying unicorns – Square at the heart of the problem
Venture Capital
Historically, when people speak about unicorns they are referring to those magical white horses with long horns sprouting from their foreheads. Today, in Silicon Valley and on Wall Street, “unicorns” refer to those private companies valued at more than $1 billion. The current list of unicorns is extensive, including household names like money-losing Uber ($51.0 billion valuation), Airbnb ($25.5 billion), SnapChat ($15.3&hellip;
Ageing Japan nurtures Indonesia’s youthful startup scene
Venture Capital
<p>As Japan’s economy struggles with the realities of an ageing demographic at home, its venture capital investors are looking for fresh blood in nearby emerging markets, namely Indonesia.</p> <p>The topic of Japan’s powerful influence in Indonesia’s startup scene was a central topic of discussion at Tech In Asia’s Jakarta event last week, the site reports. Telecoms giant SoftBank, internet firm CyberAgent, and e-commerce companies Rakuten and Beenos have all been hungrily snapping up stakes in Indonesian startups in recent years. </p> <p>The poster child of this Asian alliance is Tokopedia, the Indonesian e-commerce startup that has scooped up investments from SoftBank, Beenos, and CyberAgent at different stages. The influence is such that it is has moulded Tokopedia’s business culture, with the company using the Japanese word for friend – Nakama – to refer to its employees.</p> <p>So why is Japan into Indonesia? Well, part of the reason is that some of the earlier investors in China's internet space are trying to replicate their success in Indonesia. SoftBank, for example, struck it big by backing Alibaba and is now trying to repeat this in Indonesia with Tokopedia. The country is also attractive to those who missed out on the China opportunity altogether. Steven Venada of CyberAgent said:<br /> “Taobao [a market place owned by Alibaba] in China worked, and we went looking for something similar in Indonesia. Tokopedia had a great team, it was still early and there was a lot of opportunity.”<br /> But Japan’s mature economy and ageing demographics is also a big factor, Venada said, with a market like Indonesia offering Japanese VCs more low hanging fruit. He added:<br /> “In Japan, opportunities are more in replacing existing services, whereas in Indonesia there is still wide open space. No need to go for the niche.”<br /> Photo: Niko Knigge</p>