Analysis Paralysis


Does anyone do "early-stage investing" anymore? When we present deals to "early-stage" investors, we find their criteria to be more in line with the milestones of more established companies, and it sometimes seems like early stage is a non-entity.

I was encouraged by the news of Battelle Ventures and Allied Minds Inc., posted in The Deal here. The author mentions how both firms operate under unique structures which allow them to do true early stage investing in "pre-seed" technologies sourced straight out of research institutions and universities. Battelle only has one LP, the Battelle Memorial Institute, while Allied Minds raises money from shareholders in exchange for future equity with no specified time horizon. Perhaps these "special" circumstances allow them to take on more "risky" investments without having to answer to large numbers of LP's.

It makes me wonder if the traditional VC model actually works. What if traditional VC's could take the handcuffs off and get dirty with raw technologies and mad-scientists out of some futuristic research lab? What sort of companies would we start to see hit the marketplace and how frequent? What about timing issues and market relevancy?

"The greater the level of involvement and business expertise focused on early stage innovation, the more and higher quality of innovation we will see coming out in the marketplace" - Lesa Mitchell- VP for advancing innovation, Kauffman Foundation.


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Joe says

Bullseye! Why do most VC's and Angels view start up debt as a 100% negative instead of understanding "what it takes" to launch a brand and carrover loss.

The whole game is a joke.


Posted at 4:12 am
Diane Dutton says

Funny I should find this post. Bootstrapping is a cute term but certainly so true that you utilize your own assets till your boots fall off! Then, the next is "Did you go to friends and Family?" Ok, how many of us want our friends and family looking over our shoulder every day as we work on our early stage company. Next, after you have a product on the shelf and its PROVEN, the big question is "well, I would like to see some more sales" Wow, so would we! We need capital to build the market presence. Not all of us come from the big advertising backgrounds and can build a pair of jeans that sells millions. So, I would love to find the real angel investors out there who can spend the time, look at the technology and see the market. Oh, and please take away the vultures who want big $$ to "Help" you get your funding - if we had big $$ we would put them into our company!

Posted at 8:43 am

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