Taking a cursory look at the headlines, it seems that the venture capital (VC) business is in dire straights -- and that it will take some time for things to improve. All in all, the mood is grim.
Or is it? Perhaps this may be the ideal time for VC deals?
This appears to be the case with legendary dot-com pioneer, Marc Andreessen, who cofounded Netscape. You see, this week he has launched a $300 million VC fund. Joining him in the endeavor is another Net luminary, Ben Horowitz. Yes, the fund is called Andreessen Horowitz.
For the most part, the VC business is about knowledge, connections and luck. And both Marc and Ben have a lot of each. They have started three companies and invested in 45 ventures over the past five years. Some of their deals include LinkedIn, Twitter, and Ning.
No doubt, thousands of entrepreneurs will send their plans to the fund, but this could actually be difficult as Andreessen Horowitz doesn't even have a website.
Rather, perhaps the best way to get a meeting is to network as much as possible. Something else: the venture must have the realistic potential to be a game-changer. This means building a company that can achieve $100+ million in revenues over the next few years.
According to Marc's blog:
"While broad investor psychology whips wildly between euphoria and depression, technology change not only continues but is accelerating. In fact, we believe that technology change cascades -- each new generation of technology continues within it the seeds for even more profound advances to come. And, technology change creates continuous opportunity to build important and valuable new companies."
Tom Taulli is the author of various books, including The Complete M&A Handbook
Why is gold marching higher? Ask the central bankers
Newspaper ad revenue of 28%, 8 quarters of double-digit drops
Closing Bell: Earnings working against stocks (BCRX, DELL, DHI, INTC, LEAP, PCS)
