
Deals Missed - jkuria
http://www.ovp.com/companies-we-backed/deals-missed.html
======
pdog
Reminds me of BVP's hilarious _Anti-Portfolio_ [1].

[1]: <http://www.bvp.com/portfolio/antiportfolio>

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jburnat
What does it mean if your anti-portfolio looks far better than your actual
portfolio?:-)

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confluence
There are 1000s of startups on the anti-portfolio list. Only the winners are
shown.

Investing in startups is hard.

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dyno12345
Is it even better than random?

This anti-portfolio is so impressive it seems to suggest a strategy of
investing a small amount in all but the stupidest rather than even trying to
pick winners

~~~
confluence
Yes. Being better than random is a particularly low bar to pass.

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dyno12345
Is it so hard to believe? We still put hundreds of billions into mutual funds
that aren't better than random

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caseorganic
My co-founder and I were sitting in Coupa cafe two years ago with a couple of
VCs who told us that the Youtube co-founders had pitched them right from the
same booth we were were sitting at. "Did you invest in Youtube?", I asked, to
which they said, "no - the idea seemed preposterous at the time".

"Well", I said, smiling, "you'll probably think our idea is just as
preposterous, and saying you didn't take the jump like it's a badge of honor
probably means your firm won't work for us".

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rorrr
YouTube has never been profitable. Google only owns it, because they can
afford to, and because they believe it's the future of how people will consume
video and TV (and I think they are right).

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joering2
Correct, but as you perfectly know, VCs are not about building companies that
turn profits; they are about exiting with more than they initially invested,
regardless if someone will pay "more" because they company is really worth it,
or because its just popular in SV in this exact moment.

If you dig into YouTube long and deep enough, you will see it being "too
crooked to fail" kind of purchase (most Goog board was against it; one of the
owners is a family of a big VC name in Valley, etc).

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dmor
Sadly OVP, a Pacific Northwest institution, is winding down after 30 years.
[http://www.xconomy.com/seattle/2012/10/11/exclusive-ovp-
vent...](http://www.xconomy.com/seattle/2012/10/11/exclusive-ovp-venture-
partners-nws-oldest-vc-firm-to-shut-down/)

~~~
confluence
Good thing too:

 _> [OVP] funds have returned -16.7 percent, -18.6 percent, and -11.9 percent,
respectively, according to the most recent data posted online by the Oregon
Public Employees Retirement Fund_

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photorized
VCs get many deals wrong. A deal missed is hardly a mistake. It's the deals
won that are interesting to watch. If your chosen idea/team/model is unable to
reach profitability even after you provided a $100m cash infusion - now that's
something to be embarrassed about.

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aviswanathan
I think it's nice for entrepreneurs to read these once in a while to remind
themselves that VCs aren't perfect and that they are capable of accepting
their mistakes. But in reading this article, PG's words about how ideas that
seem flat-out crazy can have potential to succeed in a big way (Starbucks is
the one in this article that rung a bell) is really evident.

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pshin45
They're not very popular on HN, but there's a great sit-down discussion
between Mark Suster and Steve Blank from a while back in which they touch on
this topic, among others:

"Let me know the last time (traditional) venture capital led an innovation.
[...] As an industry, venture capital is now being disrupted by new entrants
rather than the existing players. Everybody from Dave McClure to Andreessen
were outsiders who were entrepreneurs themselves."
(<http://youtu.be/BUD2gxU5LPM> \- quote is at 49:30)

VCs are fast followers who are all racing to find hot ideas that have already
started to take off, but it seems that most of them are no better at
foreseeing and driving real innovation than even any of us.

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mattbauer
OP if you're looking to raise $ from OVP, I'd suggest you keep looking.

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jkuria
I am aware they shut down (someone was lamenting how VC firms in the Seattle
area are shutting down, the other being Frazier technologies) and was curious
why so I went to their site. If you miss deals like those, it is inevitable
that you have to shut down :)

Anyways, I also found this article:
[http://www.xconomy.com/seattle/2012/10/11/exclusive-ovp-
vent...](http://www.xconomy.com/seattle/2012/10/11/exclusive-ovp-venture-
partners-nws-oldest-vc-firm-to-shut-down/)

~~~
ChuckMcM
Interesting article in xconomy. I hadn't realized that all three of their
final funds had negative IRRs. That is a pretty challenging place to be.

~~~
rdl
Wtf is Seattle so weak for VC? It has a lot of rich people, mostly who got
rich from tech. Ignition is nice (but do most of their investments in the Bay
Area now, wtf), and I've never talked to Madrona but they seem to be the other
one. If I were going to do a 30-50mm global fund, I'd probably base it in
Seattle. Great for security, cloud, etc., with a great school (UW), successful
local companies, etc.

~~~
rdouble
Perhaps the folks who got rich from MSFT or AMZN simply never wanted to think
about tech again.

~~~
rdl
Plenty of tech other than those two -- F5, McCaw, etc.

~~~
rdouble
Sure, but based on what little I know about the Seattle tech scene, it seems
like a common goal is to make a lot of money and then get out of the game
entirely.

Contrast with Bay Area, where many people seem to love the game and aspire to
be angel investors themselves one day.

This is just conjecture, there's likely some other reason.

~~~
rdl
Yeah, I get that from some Seattle people -- which seems really weird to me.
If I didn't care about tech, I'd just do something like banking where returns
are more predictable and to some extent easier. If I did care about tech (and
do), I'd not want to leave just because I made a lot of money.

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tzury

        The Internet boom was just beginning. Amazon had sales of $4M a year. 
        We had a handshake on a term sheet with the CEO to put $2M into Amazon 
        for 20% of the company (a $10M post money value). At the eleventh hour, 
        some guy named John Doerr flew up and offered $8M going in for 20% of 
        the company (a $40M post money value). Handshake? What handshake?
    
        To get even, we buy all our books at Barnes & Noble. We don’t think 
        Amazon has noticed.

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lifeisstillgood
There seems to be so much capital floating around that a policy similar to YC
but broader might be the best be for a well funded VC company - call it Pre-
Angel.

Put in 30,000 dollars for 1 % of a company and option of ten. Startups must be
incorporated, and have a one page business plan. Aim to get 50/50 balance of
college grads and middle aged contractors. 30,000 is a year of ramen or a
quarter or half year for a middle aged contractor. Long enough to get off the
ground.

Then you have funded 10,000 startups for a 300 million fund. Rinse after six
months and drop 3/4 of them. Then repeat for the remaining 3000. After that
you have a stable of maybe 1000 startups now actually talk to them.

Is this just a dumb idea? I mean picking winners and crazy ideas is so hard
why not ignore it ?

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philwelch
Maybe if they'd taken just one of those deals, it would have been worth more
than their entire portfolio.

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phear
Nicely honest of them. A lot of people would not want their missed deals made
public, much less put it on their website.

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niggler
Where's the google story? Originally they pitched it in terms of a digital
library ...

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scottbartell
hilarious. "To get even... Oh, to heck with it, getting even isn't working."

