Seed Stage Slaughter

Fund Em’? I Barely Know Em’!

Reap what you sow

Betabeat has been writing about the crunch for seed stage startups looking to raise series A since August of this year. The debate over this trend is now in full flower, with VCs divided over whether or not there is a reckoning in the works.

Regardless of what position you take on the series A situation, it’s clear that 2010 saw a surge in seed stage investments. Pulling data from crunch base, Alexia Tsotsis found seed investments grew substantially while A rounds stayed flat.

As Josh Koppelman of First Round Capital writes on his blog today, this is reflected in the amount of time his firm spent evaluating new deals before deciding to invest. Over the last four years, the amount of time it took for a Read More

Beg Borrow and Steal

First Round, Venrock Invest $10 Million in Smartling to Make the Web Multilingual

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Smartling CEO Jack Welde just closed a $10 million Series B round from existing investors (U.S. Venture Partners, Venrock and First Round Capital) as well as a new face: IDG Ventures.Venrock’s David Pakman is already on the company’s board, now joined by Steve Krausz from USVP. Clients like Foursquare, IMVU, Scribd, and SurveyMonkey use Smartling’s cloud-based platform to create and maintain multilingual versions of their websites and mobile apps. The platform allows for combing different translation methods such as crowdsourced, professional, or machine learning.

“The Web is, by definition, worldwide, so every site and app should be multilingual. With this funding, we’ll continue to optimize our elegant, easy-to-use solution for this historically complex and costly technology process,” Mr. Welde said in a press release. But there’s a more practical, monetizable motivation than just democratizing the web for the good of the global internet. Read More

The Third Degree

Venrock’s David Pakman on Missing Twitter and Me-To Markets

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David Pakman is a partner at Venrock and a board member at the New York Venture Capital Association. He was formerly an entrepreneur, helping to introduce the idea of the “digital locker” for music files and serving as CEO of eMusic.

Q: You always remember the ones that got away. Tell us about the startup you regret passing on the most.

A: That’s easy. Twitter. It’s not really fair to say that we passed, but we did not fight hard enough to get in to their Series C round. Read More

Business Models

The Great Disruptor: Venrock’s David Pakman On Media Unbundling

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As a venture investor in internet companies, I look for technology-based innovation which causes major disruption among incumbents. Since advertising is the dominant business model for most of the web, I think a lot about these technologies and their impact on the future. Clearly the new devices we use to access information and entertainment are wreaking havoc on traditional business models based around ad sales. But I think the biggest change is the way new modes of consumption are forcing the unbundling of packaged media across a wide spectrum of industries. Read More