Live from the Corporate Venturing conference in Palm Springs...where Taikun was on a panel yesterday...today we heard again and again from panelists ranging from Dell to Cisco to Etrade to Novell to AOL that 100%+ IRR on their venture funds is the norm. Softbank, the largest corporate venturing fund in the world (except from maybe Intel), was not here as they were too busy doing deals at DEMO99, across town at the Hilton, where Marc Andresson's new company, Loudcloud, came out of stealth mode yesterday (Taikun sat beside head of sales on the plane from SFO on the way down, but he came out of stealth mode the night before...) . Sequoia's $200m fund has a NAV of $2.9bn after 1 year. Go figure. The Kleiner-Seqouia mob ranges strong! Intel and others use several hundred million dollar gains on IPOs to smooth out earnings q on q. M&A boutiques do a brisk business in relieving VCs of dogs in a portfolio after a year, since the VC wants to raise a new fund.
Observations from the peanut gallery:
1. Most corporate VCs can't adequately compensate the folks running the program because they'll make more than the CEO (sorry to all the telecoms, France, Italia etc)
2. US Publicly traded VCs (CMGI, ICGE) have less flexibility under SEC rules than their European/Asian counterparts
3. Most corporations receive a valuation based on (a) brand value and (b) investment. Included with brand is management expertise, channel relationships etc. Unfortunately, the core business of the corporate restricts operations of the investee firm in most cases.
4. IMO, 9984 is immune from most of the above.
Based on the above, and 9984's planned 700 portfolio companies, I'd look for a $1trillion+ plus market cap for 9984 (10x present) by 2002, over 1mYen/share.
Sell early 'n weep!
Man putting out the laundry on the clothesline in the garden. Wife kicks him in the leg, saying 'Thats for being a terrible lover'. Later, husband goes across yard to where wife is gardening and kicks in leg, saying 'Thats for knowing the difference'
JMHO |
