What a lousy year this has proven to be for the venture capital industry. According to data released today by the National Venture Capital Association and Thomson Reuters, venture funds raised just $1.6 billion in the third quarter. That’s down 82 percent from a year ago and 21 percent from last quarter.
What a costly blunder Skype has proven to be for eBay. A $2.6 billion purchase price. A $1.4 billion asset impairment charge. Missed financial targets. And now this: eBay’s plans to spin off Skype next year are being threatened by a legal dispute over the telephony service’s underlying technology.
Earlier this week John Fitzgibbon, founder of IPOScoop.com, said that LogMeIn was an IPO “candidate that should blow the socks off people.” Looks like he was right.
For a company whose business is built on the recession-brutalized fine-dining industry, OpenTable’s IPO last week was impressive. Must have made for quite a windfall for the company’s larger investors. Especially those who took the opportunity to dump their stakes in their entirety.
This Weekend Update is particularly exciting because of all the things happening here at All Things Digital. There is, of course, the upcoming D7 Conference, which promises to be more tech-extravaganza fun than a tweet from @sockington (if only half as cute), but this past week has also seen the launch of our very own iPhone app, meaning that ATD has gone mobile–smart news for your smartphone (we’re still working out potential taglines).
Anyone who dismissed OpenTable’s IPO price of $20 as grossly overpriced has, in short order, been proven grossly mistaken. Shares in the online restaurant reservation company opened at $24.50 apiece, up 23 percent from its IPO price. As I write, they’re trading at $28.72 after topping out at $30–-more than double their original price range.
EBay reported Q1 sales and earnings this afternoon that fell from the same quarter last year, but beat analysts’ estimates just the same. The company’s revenue totaled $2.02 billion, down 7.8 percent from $2.19 billion in 2008. Earnings were 39 cents per share. Analysts had been expecting worse, with estimates of 1.94 billion in revenue and earnings of 34 cents per share.
They say “flat is the new up” and that certainly seems to be the case with the venture capital industry. Though we’ve had two consecutive quarters without an IPO and the venture market is all but frozen, VC optimism is beginning to return. The latest Silicon Valley Venture Capitalist Confidence Index shows a small but noteworthy uptick in the VC community’s views of the entrepreneurial environment in the San Francisco Bay Area.
Welcome once more to Weekend Update! I’ll be filling in today for your regular host Beth Callaghan, who’s on vacation. And what sane person wouldn’t be, after the slew of Silicon Valley silliness inspired by April Fools Day this past week? Digital pranks were the name of the game, and Google and others heaped so many tepid hoaxes upon us that we wanted to call April Fold so as to quickly end this round of gags.
To hear tell from the National Venture Capital Association, the VC landscape is as burned out and desolate as the ashen vistas of Cormac McCarthy’s “The Road.” According to its latest data, not a single venture-backed company went public in the first quarter of 2009 or the one that preceded it. That’s the first time the association has ever recorded two consecutive quarters with no issues.
The market for initial public offerings has been all but boarded up by the financial crisis. The unemployment rate in the restaurant business is nearing 10 percent after what Cowen & Co. restaurant analyst Paul Westra describes as “one of the most brutal years in history for the restaurant industry.” And fine-dining sales are forecast to fall 12 percent to 15 percent in 2009. But restaurant reservation service OpenTable is filing to go public anyway.
Where are Tina Fey and Sarah Palin when we really need a laugh? In this week ramping up to the holidays, good cheer–unsurprisingly–was hard to find. 2008 may well be remembered as the year the econalypse stole Christmas.
Yahoo was bereft of cheer, for sure. BoomTown covered its long-dreaded layoffs and published Jerry Yang’s complete memo to Yahoo staff about the painful process, which began on Wednesday. Ex-Yahoos from all corners of the company spoke (and vented) to BoomTown about the as-yet fruitless search for a CEO to replace Yang, who laid himself off last month. But wait–Digital Daily pointed out a singular moment of misplaced cheer–akin to fiddling while the proverbial Yahoo burns–as the company, uh, celebrated the holidays with a bafflingly lavish year-end party on last Saturday–four days before layoffs began.
With the economy in contraction and the stock market going all to hell, 2008 was not a good year for the IPO market. In fact, volumewise, it’s looking like it was one of the worst in the last 13 years. Global IPO activity has more than halved since 2007, according to Ernst & Young’s year-end Global IPO update.
John Paczkowski has been poking fun at the tech industry and the personalities that drive it since 1997. From 1999 to 2007, he wrote the award-winning tech news Web log Good Morning Silicon Valley for the San Jose Mercury News, Silicon Valley's daily newspaper.
Here is a statement of my ethics and coverage policies. It is more than most of you want to know, but, in the age of suspicion of the media, I am laying it all out.
Best video mashup ever.
A Facebook Memorial
Wow.
Worth it for the Rickrolling photo alone.
Excellent.
Flughumor!
… you vacuous, toffee-nosed, malodorous perverts
Stephen Fry and zoologist Mark Carwardine meet the kakapo — a fat, flightless and very randy rare parrot.
Spectacular in the bellowing Russian sailor sense of the word …
“If you spell something wrong on your insurance claim, do you really deserve surgery? I don’t think so …”
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