metarand

Metarand is hatched on Halloween

I’ve recently been interviewed by HatchThat’s Ross Hill.

It’s a broad ranged discussion covering:

• the areas I think are hot (mobile,web, virtual and real worlds — mashed);
• UGC and CICS;
• the importance of business planning versus bplans;
• iterative, extremely agile leverage of existing platforms (Facebook, Open Social); and
• the state of venture capital 2.0 (and the lack of it in Australia).

New Venture Oriented Startup Factories

It sounds strange — should’nt Startup Factories be new venture oriented by definition. They may well be, but my experience is that in many instances they are too risk averse, too keen to follow the madding crowd, and hence they are not sufficiently new venture oriented. Let me explain a bit more: by “new venture” I mean in every respect - the word adventure would most likely be a better adjective for describing the kind of mentality required for startup factories. Taking a path less travelled, or better still, beating a path where others thought passage is impossible is the right journey to embark on.

So why the rant? Kristen Le Mesurier has written a piece in the Sydney Morning Herald in which she asks the question whether startup factories deliver….one of the key points picked up on in the article as well as in the comments is the one I am honing in on above.

In my view there is a lot that can be done to create the right climate for building successful startup factories.

I’ll let others drone on about how dumb it is that all of Australia’s superannuation funding is being invested offshore at the cost of innovation at home, how close minded most Australian government administrators are in their support for entrepreneurialism and how private equity has killed the Australia venture capital star - what I will stress though is that the first, and most important step, that Australia (or any nation) can take is getting people thinking right - thinking new venture.

Changing the lexicon: private equity

The New York Times reports that billions of dollars are pouring into new private equity funds worldwide. In Europe Kohlberg Kravis is raising a 7.7 bn euro fund, and in Asia CVC Capital Partners is raising a $5 bn fund and TPG a $4.2 bn one.

Take Asia - there is currently $35 bn sloshing around looking for the right deal. In the first half of 2007 $15.4 bn was committed to the region, a rise of 57% over the same period in 2006.

Hoo boy! Perhaps this is why many of my former venture capital colleagues are now private equity players. There is a saying in the industry that it takes as much effort to pull off a successful seed deal as a mega deal.

But is it all rosy? Contrarian investors take note: there seems to be somewhat of a herd mentality at play.

The NY Times article quotes research undertaken by the Center for Asia Private Equity Research - 22 deals worth $38.9 bn failed in the first half of 2007.

Regulation, competition and takeover targets are stiffening to the private equity barrage.