Disqus - Latest Comments for reiboldt

Re: If the New York Times dies, does the news die?

reiboldt — Wed, 07 Jan 2009 11:53:43 -0000

You mean to tell me the New York Times is still around?!?

Re: Always Treat Money Like It Is Your Own

reiboldt — Mon, 05 Jan 2009 22:05:07 -0000

I think this is a fundamental contributor to our current crisis. Too many fund managers were not judicious with the funds they managed. They treated those assets with reckless risk and as such lost a lot for their investors. I am not just talking about the extreme case of Madoff either. Far too many fund managers have been guilty of this. If I lose one dime of my investors' assets, it eats me up inside. I also put my own money in it, so it actually does hit me at home. Any manager that won't put their own money aside their investors' assets doesn't deserve your money.

Re: Layoffs In Venture Capital

reiboldt — Mon, 05 Jan 2009 00:35:28 -0000

I'm not necessarily disagreeing with you, but I think the caveat here with partners in venture funds is that there typically is more of a legal tie between the partners and both the fund and the companies they are associated with. Many partners at large venture funds, such as DFJ's network, etc almost act as independent investors that manage a book of capital (which typically includes some of their own capital alongside their LP's). So, the firm per se often doesn't have any real leverage to "cut partners". They also typically have a percentage of the fund's carry and rights to profit distributions, etc. Venture fund partners' compensation is typically quite diverse and can be very complicated, so again, I don't think you'll see partners getting cut en masse, because the relationship there is often too complex. Now, analysts, associates and principals will likely get cut, but those people typically act as staff in the funds. Most people don't realize how many venture funds are made up ... they are not your typical corporate structure and they aren't even similar to that of what you see in the large buyout shops. They are very individualistic. I think this is part of the reason why the model is vulnerable to breaking, because many VC's get a little too much control and there is very little oversight of the actual fund (i.e., the classic question in financial economics of "who monitors the monitors?").

Re: Layoffs In Venture Capital

reiboldt — Sun, 04 Jan 2009 23:45:46 -0000

Of course there will be job cuts in venture capital - there are cuts across the entire financial sector. It is no surprise Blackstone, Carlyle et al are making cuts; they are now the new Wall Street firm. VC funds are different; their entire make-up and structure is totally different from the large buyout funds. So yes, there will be some cuts in the Valley, but probably not how you describe. Yes, some associates, analysts and principals will go. But, partners are different; they typically have a more fixed stake in the fund and therefore they are often legally tied to the companies they're invested in. Further, the assumption about passing on board seats to lower levels isn't very likely either. It will do a fund no good to forget about companies that they are still interested in, therefore, they won't just forget about you. However, if you notice a decline in focus from your investors, perhaps they're changing their attention and placing it elsewhere. So, everyone will suffer from this downturn. The last thing entrepreneurs should be thinking about are the job cuts in venture funds.

Re: Announcement: New Platforms Fund

reiboldt — Fri, 02 Jan 2009 11:04:49 -0000

Darren, cheers to you for taking this step. I have written quite a bit on the changing VC landscape in this current market environment and I think one of the trends you will see emerge is the development of more "micro VC" funds such as this. Needless to say, there are a lot of variables and questions that must be addressed when considering a fund like this (equity stake, valuations, legal fees, dilution, etc), but for an investor such as yourself, this is a good way to take advantage of early stage innovation at low valuations and low prices. You won't be able to retire on the returns, but it could lead to much bigger things. Good job and good luck!

-Mark (www.reiboldt.com)

Re: Making Something From Nothing

reiboldt — Thu, 01 Jan 2009 14:46:15 -0000

The best quote from this post is "nothing costs nothing." This is something literally every American has found out this year. Even though everyone probably *knew* it was true, now everyone is feeling it, and it's happening in ways many people never realized. CEO's with once unstoppable companies are out of jobs. Investors who thought they were the best or with the best are finding their assets diminished to almost no value. An incoming gov't is realizing that promises are more of a challenge to fulfill when faced with major hurdles. Start-ups with products of seemingly endless value can't even raise operating capital, etc, etc, etc. This is why I wrote a few weeks back that 2008 would be known as the year of great humility (http://adjix.com/bf8); because, everyone was humbled in 2008, even asset managers with $50 billion or a Governor who thought he was untouchable. But, the great thing about 2009 is that once we learn these lessons (the hard way unfortunately), now is when the real progress can take place. I'm glad 2008 is behind us and am looking forward to 2009!

Re: Halt Medical raises $5 million more to treat uterine fibroids

reiboldt — Mon, 29 Dec 2008 17:11:41 -0000

Glad to see life sciences fundings haven't been hit as hard as general technology and web 2.o start-ups. What I'm wondering is how such big names like Volcker and Richter got involved. Is this another AthenaHealth?

Re: The Editor Dilemma

reiboldt — Mon, 29 Dec 2008 13:08:14 -0000

I think people that feel the need to correct everyones' little grammatical or spelling mistakes are those types with their own problems lacking self confidence. It's like the Little Man Syndrome for the internet. Nit-picky people drive me nuts, so don't even bother commenting to me if that's how you are. Frankly, I'm a busy person, but I enjoy making time for blogging/reading/commenting, and if I spend all of my time worrying about the presentation rather than the message, I won't have time for any of it. So, if someone picks at you/me for getting some words or letters backwards, just know they are covering their own inadequacies!

Re: The Editor Dilemma

reiboldt — Mon, 29 Dec 2008 13:04:34 -0000

Frankly, I think it's rude when people correct my poor typing. Just think about how much productivity we lose each year making sure our emails, posts, comments, etc look acceptable to third grade grammar teachers.

Re: Correspondence Is Making A Comeback

reiboldt — Sun, 28 Dec 2008 21:30:29 -0000

I wonder what Jefferson would think about the influx of citizen journalists that have developed through blogging. The newspaper business model is broken because people no longer depend on a few writers to provide what they're looking for. Before we had to find a few writers/publishers we like among a small number of mediocre ones. Today, we find the very specific writers we like amongst a large pool of writers at varying quality. The point is, we can find exactly what we're looking for, rather than settling with whoever we like most amongst the poor writers at the NYT. Moreover, the WSJ editorial page is no longer what it used to be. I think Greg Mankiw should write everyday there, but I know that's not realistic, so I'll read his blog before (or instead of) the WSJ.

Re: Correspondence Is Making A Comeback

reiboldt — Sun, 28 Dec 2008 21:24:17 -0000

I remember when one of my old school friends was making fun of me for blogging until I explained about the entire business (and revenue) I set up around it and how I enjoyed the extra few thousands of dollars every year. After I told him to wipe the dumb look off of his face (he didn't realize you could make money online), I sold him on online innovation before the conversation was done. Too bad he was only ten years late. Good post, Fred.

Re: Investing In Thick and Thin

reiboldt — Mon, 22 Dec 2008 22:00:36 -0000

It's just the basic idea of the cost of capital - it costs investors more to take a risk on a company in a challenging environment, because that capital is inherently more difficult to come by (even if it's already been in a pre-recession fund). Thus, the costs are higher for those looking for funding and this is amplified during times like this. Fred's post is very relevant and true for any type of value investor in different cycles. I'm curious, though, what performance has been like for many funds looking to increase investments in thin times. As an economist, I can tell you the data does not reflect what one would think. As an investor, I really hope previous trends are evolving.

Re: Roundup: Mac sales slow?, IE security flaw, and more

reiboldt — Wed, 17 Dec 2008 13:39:18 -0000

oops logged in using wrong account

Re: A Slightly Different Perspective

reiboldt — Wed, 03 Dec 2008 10:55:36 -0000

oops signed in as the wrong person