Sunday, January 22, 2012

Top 10 cities to launch a tech startup

My team and I gathered data from numerous cities around the World and we proceeded to rank the top 10 cities to launch a tech startup. We've ranked the top 10 cities and their 5 runner-ups based on the following criteria: a/ Availability of talent ("it's all about the startup team"), b/ Availability of infrastructure, c/ Availability of capital ("yes, this minor factor"), d/ Legal environment (labor law, corporate law, tax), e/ Entrepreneurship spirit ("Yes, people who are looked upon favorably to leave secure jobs and pursue an entrepreneurial journey).

Top 10 cities to launch a tech startup:

  1. Palo Alto (Silicon Valley)
  2. Los Angeles (Silicon Beach) [Read Forbes' Tara Tiger Brown]
  3. Boston (Route 128 corridor)
  4. London (Silicon Roundabout)
  5. New York (Silicon Alley)
  6. Dublin ("2012 City of Science")
  7. Munich
  8. Vancouver
  9. Paris [in French]
  10. Amman [Read Bloomberg's William Cohan]

Top 5 runners-up

  1. Madrid 
  2. Buenos Aires
  3. Toronto 
  4. Helsinki 
  5. Dubai

How the scoring was done: This ranking was done on relative terms, and NOT on absolute terms. Indeed, it is clear that the amount of capital available in certain cities is far greater than that of many cities in this ranking. The weight given the above five criteria was computed to the ratio of each factor as a % of the whole data set for that city from our sources below. The goal of computing a ranking based on relative terms, rather than the easy absolute terms, was to attest to the vibrancy of each city's entrepreneurial community, no matter how small. Using relative terms, a city with $200M in seed and venture capital may achieve a better ranking than a city with more capital simply because other human, legal and infrastructure factors scored higher.

Special thanks to my team and to our hardworking data-crunching interns

Wednesday, January 18, 2012

Accel to make 800x return on Facebook IPO

Accel Facebook Bet Poised to Become Biggest Venture Profit
Jim Breyer of Accel
A few months after struggling to raise a new fund in 2005, Accel Partners bet $12.2 million on a website run by a college dropout. Seven years later, that wager is poised to be the most profitable ever for a venture firm.

Accel, whose partners include Jim Breyer and Kevin Efrusy, is the top outside investor in Facebook Inc., owning about 10 percent. Assuming Facebook is valued at $100 billion, Accel’s stake on paper is worth about $10 billion.

When Accel made its Facebook investment, the site had just 2.8 million users -- all on college campuses -- and was run by a 21-year-old Mark Zuckerberg. Now it has 800 million members worldwide and an estimated $4.27 billion in 2011 sales, according to EMarketer Inc. That explosive growth is poised to deliver an 800-fold return on Accel’s money, catapulting the firm to more here Accel Facebook Bet Set as Biggest VC Profit

Tuesday, January 17, 2012

Google stocking up on Gaming startups

Bionic Panda Games has raised seed financing to develop mobile games for Google’s Android operating system, the company announced today. Not surprisingly, Google Ventures is one of the backers.

San Francisco-based Bionic Panda got its start in 2010 and has so far had one hit with Aqua Pets (pictured above), which has been downloaded more than 3 million times and is a top-100 grossing application on the Android Market.

That strong performance allowed it to raise the round (it was raised last year and is being announced for the first time today) from Google Ventures, SoftTech VC (where Hudson is a partner), Norwest Venture Partners, 500 Startups, and angels Craig Sherman and Kal Vepuri. That’s a pretty strong group of investors, but Bionic Panda’s founders, game veterans Charles Hudson and Mike Jimenez, have a good pedigree.

Hudson ran a number of well-known industry conferences such more here Bionic Panda raises seed funding for Android mobile games | VentureBeat

Friday, January 13, 2012

Venture Capital is not a subset of Private Equity

The NVCA, the US association of venture capital funds,  is stepping in this election year's  communications arena to clearly define the difference between Venture Capital and Private Equity.

As the race for the Republican Presidential nomination moves into high gear, we have all seen both the media and the competing campaigns turning their focus to Mitt Romney and the time he spent at Bain Capital. Unfortunately, much of the coverage has created significant confusion regarding the difference between venture capital and private equity. 

While NVCA does not endorse presidential candidates, and we have not and will not comment on Mr. Romney or any other presidential candidate's credentials, we must and will engage the media in the discussion about what venture capital is and is not

Of particular importance is accurately communicating venture capital's unwavering commitment to job creation and innovation - and the fact that we work with entrepreneurs to create and grow new companies, characteristics that distinguish our asset class from all others. 

To that end, you can expect to see NVCA focusing in the coming weeks and months on educating the press, campaign staff, and Capitol Hill on these notable differences and encouraging our members to take every opportunity to talk about what they do each day to help grow their promising portfolio companies.

Tuesday, January 10, 2012

Top 15 Humans with the Entrepreneur's DNA

It seems to me that it is essential to have the entrepreneur's DNA in a population in order to grow an entrepreneurial environment, and therefore a successful startup ecosystem.

The right parameters should be driven by the need to own its own business, to start something of personal value, to build something of personal pride, to seek independence, to pursue achievement (monetary or otherwise) . All on a voluntary basis, and not necessarily out of desperation.

The chart shows that many smaller countries such as Norway or Australia have populations driven by entrepreneurship. However the argument that Americans are more driven by entrepreneurship than the Europeans or the Asians is wrong, when you look at the % of the population of the country as a whole. 

The only reason it seems that the U.S. drives more global entrepreneurial success stories is because it has a large domestic market, that gives immediate and substantial traction to startups, and two, the readily available pool of angel and venture capital, not present in other countries.

If we were to regroup all the European countries, the data would be very different but their markets are still fairly fragmented (language and culture), which proves the Eurozone still has a long way to go to become a single large market for startups. 

Brazil and China, the two next largest market blocks, are fast rising but still too far for probably another generation or two. This is mostly due to availability of risk capital and sophisticated entrepreneurial talent.

Entrepreneurs lining up for new Startup Stock Exchange

He has invented 21 products for treating heart disease. He led the growth of two multi-million dollar health companies, which eventually sold to Medtronic for over $4 billion in the late '90s. He has even run for governor of California. Now serial entrepreneur Howard Leonhardt wants another notch on his belt: To help create 23 million American jobs. He plans to do it by starting the California Stock Exchange—think NASDAQ for start-ups and small businesses....Read more A Start-up to Create 23 Million Jobs in America?

Sunday, January 8, 2012

Urgently Needed: More VC IPOs in 2012

[Guest Post] In this morning’s Exit Poll release by the NVCA and Thomson Reuters, we were deliberate in making the point that despite the Q4 momentum, the venture-backed IPO market did not recover in 2011. In fact, it still has quite a way to go before we declare a healthy IPO market. Here at NVCA, we are focused on the NUMBER of offerings rather than the total offer amount as our country needs MORE public companies – not necessarily bigger ones.

Aside from the need for more IPO volume, here are a few other trends that 2011 data suggests:

Bulge Bracket Banks Still Dominate: Morgan Stanley served as the book manager or co-manager for the most...continue here: 2011 IPO Stats Show 2012 Trends to Watch