Corporate Venture Capital Investment at Highest Levels Since 2001

"Corporate venture capitalists invested $1.3 billion into 390 deals in the first half of 2007, representing the highest percentage of corporate venture deals and dollars since 2001 according to the MoneyTree Report by PricewaterhouseCoopers and the National Venture Capital Association (NVCA) based on Thomson Financial data. In the first two quarters of 2007, corporate venture capital groups participated in 21.4 percent of the total deals and invested 9.2 percent of the total dollars. This compares favorably to the same period in 2006 when corporate venture capitalists invested $1.0 billion into 352 deals, accounting for 19.8 percent of all deals and 7.5 percent of total dollars."

Motorola Sues Aruba Networks: Financial News - Yahoo! Finance

"Mobile handset maker Motorola Inc. said Tuesday it filed a federal patent infringement lawsuit against Aruba Networks Inc. over wireless local area network technology for which two Motorola subsidiaries hold patents."

Sequoia Cap vs.Yale Endowment: Like David Swenson cares?

"One limited partner feeling the heat is Yale University and its $18 billion endowment fund. Yale declined to invest in some funds launched in the past few years by Sequoia, including a 2005 fund focused on Chinese companies. Sequoia later decided to "oust Yale from its partner group" because the university passed on the new funds, which targeted "later stage deals, China and Israel," according to a September 2006 internal Yale review of the endowment's private-equity portfolio.

Sequoia told Yale it preferred investors that would give the Menlo Park, Calif., venture-capital firm a "blank check" to invest as it saw fit, according to the 39-page Yale memo, parts of which were reviewed by The Wall Street Journal. A Yale spokesman declined to comment.

Sequoia partner Doug Leone declined to comment on the Yale situation, citing privacy agreements with the firm's investors. He said Sequoia doesn't pressure its investors and has "multiple" investors who have declined to put money into the firm's many overseas funds "without repercussions of any kind.... We encourage our limited partners to invest only in the funds they believe in.""

YouTube - Miss Teen USA 2007 - South Carolina answers a question

Cnn: Hackers say they've unlocked iPhone

"Hackers have found a way to use Apple's iPhone on networks other than AT&T Inc's., opening up the coveted device to rival carriers and overseas customers, according to a Web report Friday.

A group called iPhoneSIMfree.com said it has developed a piece of software that, when installed on an iPhone, allows the use of rival mobile services, such as T-Mobile, according to widely followed technology blog Engadget.com."

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VentureBeat: The credit crunch could help venture capitalists

"His basic argument is as follows: Investors shied away from tech stocks for years, fearing the post-2000 bubble risks. Leveraged investing strategies were perceived as less risky. For the last five years, he watched the skyrocketing returns from hedge funds and buyout funds “with jealousy,” he says. However, now we’ve just witnessed a sharp shift in perception of the risk for those leveraged investing strategies. Investors will return to things like technology technology IPO market, which is what really drives venture returns, and a reinforcing lust to invest in start-ups. Investors have finally demonstrated a willingness to buy technology IPOs. There were some 36 technology IPOs in 2006. He expects to see that number double this year: “In the middle of the liquidity crisis, VMWare went public, traded up sharply and stayed there.”

SeekingAlpha: Why is Sprint Nextel Focusing on WiMAX?

"Trade Radar Operator submits: I was somewhat surprised when I heard that Sprint Nextel (S) was building a separate network based on WiMAX technology. This is not a replacement for its 3G cell phone system but in addition to it. Why would they do such a thing given the scale, complexity and cost? Are they doing this in the hope that if they build it, they (customers) will come?
So first of all, what is WiMAX and why is it significant?
Technically speaking, it is a 4G wireless broadband network that uses the mobile WiMAX (Worldwide Interoperability for Microwave Access) IEEE 802.16e-2005 technology standard.
Why is that good? Because you can get high-speed Internet access with it for devices ranging from phones to PCs and devices we haven't thought of yet. And in this case, WiMAX "high-speed" is significantly faster than typical Internet access via current mobile phone technology. It will be a real data network, not a data pipe bolted onto a telecommunications network.
What could this lead to in the future?
Initially, Sprint is rolling out the product in the areas "

Grid computing: The term may fade, but features will live on

"Predictions about grid computing's evolution
In 2007, the 451 Group expects several pivotal changes in the IT landscape, including:
• Virtualisation will go mainstream, changing the datacentre
• Grid infrastructure will get baked in to support utility computing, and on-demand activities
• SOA will move from experimentation to implementation
• Open-source technology will move up the value chain
• Web 2.0 will morph into Enterprise 2.0 and change how companies interact internally and with others
• Silos will become horizontally integrated resources ('flat IT')
• Virtualisation will allow grids to be absorbed into enterprise fabrics
Meanwhile, developments expected by 2010 include:
• Grid technology will move beyond analytics into mainstream applications
• As virtualisation allows grids to be absorbed into the fabric, the term 'grid' will fade away
• Enterprise utilities will form
• A wide range of providers will offer some form of grid-enabled, utility-type computing, from telcos to IT vendors to systems integrators to Amazon and Google "

Aruba gains but Cisco still leads wireless LAN race

"Since going public in march, wireless LAN supplier Aruba Networks has almost doubled its market share, putting it in a better position to compete directly against the 800-pound gorilla in enterprise networking, Cisco Systems. Cisco, however, also is gaining market share, indicating that enterprise wireless networking could become a two-horse race.

Aruba last week disclosed its latest customer win: Prudential Fox & Roach, the nation's largest single-market real estate agency and the third largest overall, will deploy the No. 2 vendor's wireless LANs in some 80 offices.

"We baselined against Cisco and Aruba, " says Bill Friemann, Prudential Fox & Roach's VP of technology operations, "and Aruba won."

Sequoia closes its third fund at $300 million

"Sequoia Capital India, a venture capital and growth equity investment firm, on Friday announced that it recently closed its third venture capital fund for India at approximately $300 million. According to Sequoia, this new fund will focus on investing in high-growth early-stage companies across sectors.

The firm currently manages over $1 billion in dedicated capital for India across three venture capital funds and a growth equity fund. Speaking on the launch of the new fund, Sumir Chadha, managing director, Sequoia Capital India, said, “We are pleased to announce the closing of Sequoia Capital India III, which we capped at $300 million - our third venture capital fund for India. We look forward to continuing the partnership with high-quality entrepreneurs to build large, valuable companies.” “Sequoia Capital India is pleased with the partnerships built with management teams, in which we have invested over the past seven years,” said K P Balaraj, MD, Sequoia Capital India."

VCRatings: Kleiner Perkins and Sevin Rosen come alive with XenSource exit

"You don't hear as much about Kleiner Perkins Caufield & Byers and Sevin Rosen as you used to. Kleiner Perkins is busy investing in anything but consumer Internet companies while Sevin Rosen decided against raising another fund last year.

But, they are still cashing checks. The pair invested $6 million in a first round investment in January 2005 into XenSource, an open source virtualization startup that agreed to be purchased by Citrix Systems for $500 million.That's a big hit for the duo. Other beneficiaries include Accel Partners, Ignition Partners and New Enterprise Associates. "

TheRegister: VMware IPO

"A few years passed and VMware sold itself to EMC for $635m in 2003. Damn does that look foolish now.

VMware's IPO target values the software maker at about $10bn, since EMC is only selling off 10 per cent of the company. But, really, who cares? VMware's management is rich and will get richer no matter how you slice it. Now the plebs with stock options can make some coin too. Take that, Google.

The market - and the likes of Intel and Cisco that have fallen over themselves to put money in VMware - want nothing to do with reservations about the IPO. They abandoned any inclinations to embrace reality long ago. There's no room for reality when a company increases revenue between 90 per cent and 100 per cent per quarter.

Okay. Here's me drinking a few cups of coffee before the Jungian collective orgasm begins in earnest.

The Grumbles
6:25 - Okay, five minutes to go.

Had to get my morning constitutional out of the way early today. I don't want there to be a mess when that bell rings.

Can you believe these jokers were only seeking a $100m IPO back in April? Does EMC's Joe Tucci have any idea what this beast is worth? Do the Wall Street guys advising EMC and VMware?

Makes you wonder.

Vgasm
6:30 - Ding, ding, ding!

There's VMware's chief Diane Greene and husband/co-founder Mendel Rosenblum ringing the opening bell. I could see Mendel hoot while watching BloombergTV. I think he was freaking as visions of sugar plum billions danced in his head.

The TV anchors can't stop talking about VMware. "It's the biggest tech IPO since Google," we're told."

VMware hottest IPO since GOOG

"VMware Inc. priced at the top of its range for its stock market debut Tuesday, as the software spin-off from EMC Corp. raised nearly $1 billion from tech-hungry investors."

"EMC, which acquired VMware in 2004 for $635 million, announced in February its plan to sell off 10 percent of VMware in an IPO. In June, VMware estimated the IPO price range at $23-$25 per share, but it raised that last week to between $27 and $29.

VMware provides virtualization software, which creates multiple logical servers in one physical server, increasing the utilization rate of servers. Virtualization is also being applied to storage, networks and desktop computers. "

Ouch, venture investors must be feeling a world of pain for selling VMW that early.

Burnham's Beat: Understanding Why Your VC Is Acting Crazy

"One thing that many entrepreneurs don't fully appreciate is just how much the financial and organizational dynamics within a VC fund can affect how a VC behaves on their board. Over the years I have heard many stories from entrepreneurs expressing various degrees of frustration and mystification over a position taken by their VCs, usually with regards to an upcoming financing or an M&A transaction. For example, in some cases a VC that has been very supportive about patiently growing a business all of a sudden becomes obsessed with selling the company or in others a VC that has been aggressively pushing the company to grow quickly all of sudden becomes extremely cost focused and lobbies hard to cut the burn rate despite the fact that this will kill growth. After witnessing such abrupt changes in attitude and direction, many entrepreneurs are left scratching their heads wondering 'What the hell is going on with my VC and why are they acting so crazy?' The answer to this question can often be found by simply getting a better understanding of the current financial and organizational dynamics within a VC's fund, as these issues can have a profound impact on how a VC and/or their fund approaches a specific investment. With that in mind, here is some specific advice for entrepreneurs in terms of what questions they should be asking VCs and what information they should be monitoring."

Network World: 802.11n wireless LAN tests show 'unbelievable' results at state college

"The IT staff at Morrisville State College, where the first large-scale Draft 802.11n wireless LAN is being designed, ays the beta gear exceeds expectations. The school last week plugged in the first 10 production units of Meru Networks access points."

RED HERRING | NBC Funds Worldwide Biggies

"Multiplatform production studio Worldwide Biggies, helmed by Hollywood honcho Albie Hecht, announced Monday that it had scored $9 million in funding from a mix of big media companies and venture capital firms.

The New York City-based company’s first round was backed by NBC, Hearst Corporation, Greycroft, Platform Equity, and PrismVenture Works.

The investors were attracted to Mr. Hecht’s proven record of creating entertainment brands for children and young adults, said representatives from the investment groups working on the deal. As a former president of Nickelodeon and Spike TV, Mr. Hecht oversaw such hits as SpongeBob SquarePants, Dora the Explorer, and Blues Clues."

BB Hits 756th Homer to Pass Aaron for Record

"Barry Bonds hit the 756th home run of his career to break baseball's most hallowed record and end a chase that was dogged by suspicions of steroid use.

Bonds launched a 3-2 pitch from Mike Bacsik over the right- centerfield fence with one out in the fifth inning of the San Francisco Giants' home game against the Washington Nationals at AT&T Park. The homer by Bonds, who singled, doubled and scored twice in his first two at-bats, gave the Giants a 5-4 lead."

IPO Analysis: VMware, A Virtualization Pioneer - Seeking Alpha

"Vivek Kumar submits: VMware (VMW) is a leading virtualization solution provider. The company was incorporated in 1998 and acquired by EMC (EMC) in January 2004, since then operating as a wholly owned subsidiary of EMC.
As a part of EMC, the company shows much growth in its revenues and today, it has attained a pioneer position as a leading virtualization solution developer. Virtualization solutions are attractive to everyone, from home users to high end servers installed in the world's largest companies.
VMware is an R&D based company and since 1999 has introduced 16 products. As of March 2007, it employs 3000 employees with more than one third [1100] of its employees work in the R&D division. The company provides solutions for creating virtual platforms within computer infrastructure and further to automate, maintain and manage the virtual infrastructure. It also provides all related services such as installation, implementation and training."

PayPal Co-Founder's Startup, Slide Inc. Emerges As the No. 1 Widget Maker

"Max Levchin already changed electronic commerce as a co-founder of PayPal, an online payment service that is expected to process more than $40 billion in transactions this year.
Now, he's tinkering with a new way to make money off Internet widgets -- high-tech shorthand for the mini-applications planted on the personal pages of online social networks and other popular Web sites like Google."

"Levchin's latest startup, Slide Inc., has emerged as the No. 1 widget maker so far, largely because its programming tools have made it easy for people to add more pizazz to the pictures and videos decorating trendy hangouts like MySpace, Facebook and Bebo."

NYTimes: In Silicon Valley, Millionaires Who Don’t Feel Rich

"Silicon Valley is thick with those who might be called working-class millionaires — nose-to-the-grindstone people like Mr. Steger who, much to their surprise, are still working as hard as ever even as they find themselves among the fortunate few. Their lives are rich with opportunity; they generally enjoy their jobs. They are amply cushioned against the anxieties and jolts that worry most people living paycheck to paycheck.

But many such accomplished and ambitious members of the digital elite still do not think of themselves as particularly fortunate, in part because they are surrounded by people with more wealth — often a lot more."

RH: Fundraising by U.S. VCs tumbles 62 percent in second quarter, survey says.

"Fundraising by U.S. VCs tumbles 62 percent in second quarter, survey says.
August 1, 2007

Limited partners ponied up $3.23 billion for the U.S. venture capital firms in the second quarter, 62 percent less than in the year-ago quarter, according to a new survey released Wednesday.

After the second soft quarter in a row, venture capital firms were on pace to raise just half of the $24.7 billion for funds closed in 2006, according to statistics from Dow Jones VentureOne."

On a lighter note...

Battery Ventures and Pitango Venture Capital Invest $17 Million in Anobit Technologies

"Battery Ventures and Pitango Venture Capital today announced their $17 million Series A investment in Anobit Technologies, LTD. The round was led by Battery Ventures. Anobit, based in Herzelia, Israel, is a fabless semiconductor start-up company developing enabling technologies for the large and growing flash memory market. The flash memory market has grown from $8.2 billion in 2001 to over $20 billion in 2006, and is projected to reach more than $25 billion in 2010 [Source: Gartner]. With this investment, Battery General Partner Scott Tobin and Pitango Managing General Partner Rami Beracha join Anobit’s board.
Anobit’s technology optimizes the cost and performance of flash memory devices, paving the way for the next generation of memory solutions. The company was founded by three internationally recognized experts in the fields of signal processing, digital communications, system and silicon design: Professor Ehud Weinstein, Dr. Ofir Shalvi and Ariel Maislos.
“It’s been great getting to know the team over these last few years. When we discussed this newest venture with them it was apparent that they once again were putting together one of the more gifted teams in Israel to attack a very difficult problem,” said Scott Tobin, Battery general partner. "

The Deal Blog: Want Google to Acquire You?

"Salman Ullah, head of corporate development at Google, explained today at AlwaysOn's Stanford Summit why acquisition negotiations usually fall through with the company.

Aside from a valuation gap that can't be bridged, or a lack of engineering talent, Ullah said Google will always walk if the company being looked at isn't completely honest about the state of their company. For example, Ullah said one company Google was recently talking to didn't disclose the fact that most of their code was written by engineers that were no longer there. Ullah said that if the company doesn't disclose things like that up front and then denies it when questioned by the company, Google will walk no matter how interesting the company is."

Disney buys an expensive $350m penguin

"They may be flightless in the real world but penguins are soaring in the virtual one, as borne out by Walt Disney Co.'s agreement to pay $350-million (U.S.) for Kelowna, B.C.-based Club Penguin.

The online club lets subscribers take on the identities of penguins that waddle and chat in spots such as a ski hill, custom-furnished igloos and a coffee shop. The deal, announced yesterday, generates a windfall for the company's three founders, who are its only shareholders, and highlights the burgeoning appetite for social networking sites that cater to a preteen audience.

Having fended off multiple offers from venture capital investors and would-be buyers, Club Penguin's creators decided deep-pocketed Disney would be the best partner to help a company based on a flightless bird spread its virtual wings, co-founder Lane Merrifield said yesterday.

"We have been offered a lot of money from a lot of different people at various different points," Mr. Merrifield said on a conference call with reporters."

CRN: VMware In Two-Week Road Show To Prep For IPO

"VMware has started its "road show" this week, one of the last steps on the path towards IPO, with Wall Street expecting the IPO to finally happen on Aug. 14.
A source close to the server virtualization software giant confirmed that the road show has started, and is expected to last two weeks, after which the long-anticipated VMware IPO will probably happen.
The road show is the time when a pre-IPO company's executives present the company to analysts, fund managers, and perspective investors in order to generate interest in investing in the company.
VMware's IPO price is expected to be between $23 and $25, according to its S-1 filing with the Securities and Exchange Commission about a month ago.
Storage giant EMC said in February that it will sell a 10-percent stake in VMware through an IPO in a move to help VMware employees realize more value from the company independently of what they receive as part of the overall EMC organization."