Wednesday, August 20, 2008 Garbage In... Advanced Equities

"A late-stage venture funding outfit is foisting junky startups on investors--much to the benefit of the Sand Hill Road crowd.
It's just the sort of improbable success that Silicon Valley adores. Two young entrepreneurs have, in a mere five years, turned an obscure Chicago venture capital firm into a presence visible from Sand Hill Road. This year Keith Daubenspeck and Dwight Badger's Advanced Equities Financial is on track to raise $1 billion for startups previously backed by industry Brahmins like Kleiner Perkins Caufield & Byers, Benchmark Capital, New Enterprise Associates and Vinod Khosla.

In the process, closely held AE earned operating income (Ebitda) of $26 million last year on $300 million in revenue. Daubenspeck is ranked 72nd on the 2008 FORBES Midas 100 list of top tech dealmakers. He hopes to take AE public within 18 months."


Anonymous said...

Doesnt make much sense to me. In the last 9 months, my advisor put me in the following deals. Easic, Agami, Bloom Energy, Amyris Biotech, Turin, Magnum, Suniva, Motricity, and Raza Microelectronics. Agami is the only failure which isnt AEI's fault, they are just a placement agent. Most of the other companies are doing over $75 million in revenue right now. I think this article seeems a little unfair.

Just said...

Funny thing about this story is I became an investor in AEI because Forbes did a feature article on John Doerr and he mentioned his two best deals being Amyris Biotech and Bloom energy. Sure enough, it was Advanced Equities who led the rounds of those financings. My advisor was very upfront about AEIs past as an early stage shop with a lot of problems. I actually had a great experience getting a chance to meet the CEO of Amyris before I invested. They are one of the most transparent private equity shops I have ever seen as they gave me a log in to their Venture gateway, which allows me to look at all of their offerings, check out a video from the CEO of each company, read a ppm for each company, they have conference calls with the CEO and I even got to visit Amyris Biotechs headquarters before I invested. I have never actually been treated so well as an investor. Then my advisor invited me to their conference in New York so I could meet the management teams of some of the other companies I was interested in and to my delight I was sitting at a table next to Steve Forbes. It's too bad the author of this piece missed the conference because their were a lot of great companies and he could have congratulated the Chairman of the firm for being ranked on the FORBES midas list.

Anonymous said...

is that you, keith?