Crowdfunding Fills VC Void

Was it VC snobbery or unreal valuations that caused a well known Silicon Valley VC to call consumer startups (most notably, mobile app companies) “fruit fly experiments” affirming that his firm, Andreessen Horowitz,  is investing in fewer Series A deals for those companies because many of them are still in the process of figuring out a viable business plan and tend to flit from idea to idea.

The firm is now “raising the bar for most consumer Series A rounds such that we would be looking for more traction and/or evidence that the entrepreneur’s idea were actually working.”

With the VC world becoming more particular, it’s likely that more will turn to crowdfunding, especially since the bar to advertising has been dropped.

http://blogs.wsj.com/venturecapital/2013/10/14/andreessen-horowitzs-scott-weiss-clarifies-firms-series-a-stance-apologizes-for-fruit-fly-remark/?mod=WSJBlog&mod=wsj_valetbottom_email

 

About JeffKoeppel

I am a corporate/securities attorney in the Washington, DC area. Prior to joining the firm, I was a Senior Attorney Advisor in the Division of Corporation Finance at the U.S. Securities and Exchange Commission. I am a member of the Bars of the States of Maryland, New York and the District of Columbia. You can also follow this blog on LinkedIn at: http://www.linkedin.com/pub/jeffrey-a-koeppel/0/63/5a9
This entry was posted in Congress, Crowd Fund Act, Crowd Fund Act of 2012, Crowd Funding At the Margins, Crowd Funding Platforms, FINRA, Investments, Jobs, Legislative Intent, SEC, Small Business, Venture Capital, Wall Street and tagged , , , , , , , , , , , , , , , , , , , , , , , , . Bookmark the permalink.

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