The Epicenter of Venture Capital is not Sand Hill Road

What is the Epicenter of Venture Capital?   Obvious answer: Sand Hill Road...right?  Wrong: it is actually Burlingame, CA.  

Of  course, I'm biased because I live in Burlingame.   But, I believe this is the best location on earth for a venture capitalist. The reason is because the true epicenter of Venture Capital should be in the offices of startups and the garages of entrepreneurs.  Certainly not in the often too-quiet and stale offices on Sand Hill Road.  I am surrounded by startups.  The central location of Burlingame on the Bay Area Peninsula allows me to connect more easily with entrepreneurs in the markets that I invest. For those who don’t know, Burlingame sits directly between downtown San Francisco and the heart of Silicon Valley. And, it is also about 5 minutes from SFO.

I try to spend most of my time out of the office.   If I am sitting in my office in front of my computer, I am failing as a VC.  Where do I really want to be?  I'd rather be in SF meeting with the next hot mobile or consumer internet startup.   Or, in San Mateo meeting with the next category-leading SaaS company.   Or, meeting with one of my 3 investments in SF or my 3 investments in Burlingame/San Mateo.  I take as many meetings at The Creamery in SF or Le Boulanger in San Mateo as I do in my office on Sand Hill Road.  But, mostly I like visiting entrepreneurs where they work.   That is the best way to learn - by listening, seeing and feeling what is going on at a startup.  Inside the walls of a VC office is not the best place to truly understand entrepreneurs or startups.  

So, for me, living in Burlingame means that I sit right in the epicenter of my business.  Don’t get me wrong, I have plenty of meetings at InterWest's offices on Sand Hill including many important meetings with my Partners.   And, I’m willing to get on a plane to find great teams and companies. In fact, I have investments in Austin, New York and Seattle.

This post is not meant to be a public service announcement for Burlingame. But, hopefully it gives entrepreneurs a better sense that I can get to them very easily and I would rather meet at your offices than my own, if at all possible.

Why Now? The Key Question for Startups

There are many important questions that entrepreneurs ask themselves when starting a business or that VCs ask when making an investment decision.   Common questions include: How strong is the team?  What is the competition?  How good is the product?  What is the financial plan?  But, there is an important question that is too often missing:

Why Now?     

In other words: What are the fundamental drivers that are creating a huge market opportunity?   What is causing the tide to rise and float all boats in a market?   What ingredients exist to allow a market that didn’t work 5-10 years ago to flourish today?

I believe every VC pitch deck should have a Why Now? slide.  If there aren't fundamental market forces that are creating a massive new market opportunity, you could certainly still build a great business but not likely one with explosive growth.   

Why Now? Examples

Mobile Device Management – Corporate employees are also consumers.  And millions of employees are bringing their own devices to work (BYOD) - iPads, iPhones, Androids, etc.  For a while, enterprise IT organizations fought this trend.   But, CIOs now realize they have no choice and they require new systems to monitor, manage and secure these devices.  This is happening at nearly every enterprise in the country today.  As a result, the Mobile Device Management market, with leaders like MobileIron, is exploding.

Social Marketing – With the rise of Facebook, Twitter, Linkedin and Google+, the CEO of

The Market Curve

Below is a link to my post in Techcrunch about "The Market Curve": a theory about the life cycle of Markets.

First, a period of overheated expectations (the "Hype Cycle") followed by an extended trough (called "Facing Reality") when the market is not able to deliver.   Ultimately, when the core technologies, the right products and the leading companies are in place, strong technology markets become much larger than contemplated even during the Hype Cycle (called "Liftoff").

Link to Entire Blog in Techcrunch

Sexy IPOs versus SaaS-y IPOs

Below is a link to my post in Techcrunch about the increasing trend of sub-$100M revenue IPOs of SaaS/Enterprise companies.  

http://techcrunch.com/2012/03/10/sexy-ipos-versus-saas-y-ipos/

Thank you Techcrunch for running this article!

"Signs" of a Bubble in Silicon Valley?

Zynga Billboard in South San Francisco

Is there a technology bubble?   That is the question everyone is asking in Silicon Valley.   Those who believe that there is a bubble point to the billboard advertisements along Highway 101 to support their case.  Their argument is that the last time we saw billboard advertisements from technology companies was during The Bubble in 1999.

Well, they are right about one thing: the tech billboards are back!  And, even more noteworthy is that many of these billboards are not even promoting products or services.  Rather, they are there to recruit new employees! 

At 8.3% unemployment, is there anywhere else in the United States that has a glut of billboard advertisements to recruit employees?  Below are a few of the many recruiting billboards in Silicon Valley.

Creating a Blog using Collaborative Consumption Services

I am fortunate to see dozens of innovative new internet products and services every month.  But, it is not often that I have the opportunity to utilize those products in a business context.   So, it was fun (and effective) to use two new services to create the logo and design the layout for this blog with minimal effort, at a very reasonable cost and, hopefully you'll agree, in a high quality way.

I chose crowdSpring to create the logo for my blog.  crowdSpring is a marketplace of designers who submit proposals for logo and graphic design projects.  I offered a $300 payment and received 50+ submissions for logos.  I was able to give feedback on the logos, easily share them with my colleagues for reactions, and ultimately iterate with the designer on the one I chose.

Two Categories of Great Apps

If you are like me, you love smartphone apps.   But, you are also overloaded by the number of apps that exist in the app store and also that you've downloaded to your device.  As an investor in both Tapjoy and Flurry, I spend a lot of time thinking about what makes a great smartphone app.

To help me make sense of the overload, I've come up with two categories of great smartphone applications.