AngelGate dispute among Valley investors cracks wide open When TechCrunch editor Mike Arrington barged in on a secret meeting of super angels, the wealthy individuals who are taking an increasingly prominent role in startup investing, the facts were open to interpretation. Arrington alleged that he heard the meeting was about illegal collusion. That seemed so unlikely. But now an email sent by investor Ron Conway (right) shows that there is a real fracture in the angel group about whether there was an attempt at collusion, as Arrington alleged. Two days ago, Arrington wrote a post where he alleged that the secret meeting that he crashed was in fact an attempt by a group of super angels, or well-heeled investors with their own funds, to illegally collude by agreeing to hold down startup valuations. Dave McClure, head of 500 Startups, wrote a post that blasted Arrington’s credibililty. The significance of McClure’s message became clear as an anonymous source then forwarded the actual email from Ron Conway to the angel group.
How to invest in the coming app bubble - The Cody Word By Cody Willard AppConsumer editor-at-large, Nathania Johnson published a great rebuttal today to an article provocatively titled, “Mobile apps and why they have no future.” She goes through author Rob Ford’s piece bullet point, by bullet point here, and I want to hit on one of her points because every tech investor needs to be thinking about this right here, right now as we enter our App Future. “Apps are like the Internet in the 90s.” Uhh, hello! And as I’ve said many times in the last few months and as I’ll say many more times in coming months, didn’t the Internet change everything? Don’t you think you want to get in front of the app revolution because it’s very, very likely to turn into an app bubble, just like the Internet Revolution went through its own bubble phase? Do you remember the PC Revolution and how it bubbled and how hundreds of companies were created, built into mini-juggernauts and then flamed out? Do you see how all those revolutions played out similarly?
TechCrunch editor walks into meeting of “super angels” engaged in alleged collusion Mike Arrington, editor of TechCrunch, sure knows how to ruin a party. He evidently walked in on a meeting of prominent Silicon Valley investors and discovered they were allegedly colluding to keep a lid on startup valuations, cartel style. In a blog post, Arrington said that he was tipped off about a secret meeting of “super angels,” or well-heeled investors who are competing with the best venture capitalists to find early stage investments in hot companies in Silicon Valley. Arrington was told he was not welcome at the meeting at Bin 38, a restaurant and bar in San Francisco. “I’ve never seen a more guilty-looking group of people,” Arrington wrote. Arrington said the topics included: Arrington said two of the people attending were extremely uneasy about the meeting and told him they were only there to gather information, not participate. We don’t know what’s true here.
Guidelines for potential angel investors (Editor’s note: Will Herman is an entrepreneur who has founded or held senior roles in several tech companies.This story originally appeared on his blog.) I did my first angel investment in 1994 and I’m now in the process of wrapping up my 31st (individually, that is, not as part of a fund). It’s also my third in the past six months. I’ve probably done about 30 more as a limited partner in seed funds and incubators along the way as well. All in, that probably makes me a second tier angel investor, at least in terms of deals done. Third tier if you count the “super angels” who have knocked off hundreds of deals in shorter periods of time. I invest because I have a blast doing it. The difference between a second tier the first tier guys and investor like me (other than brains and talent) is the first tier investors actually work at finding investments. Fortunately, I’ve been moderately successful with this type of investing. The general ones: My Personal Guidelines:
Super angel Dave McClure admits he was at secret dinner, denies collusion Dave McClure, a “super angel” and founder of the seed stage startup fund 500 Startups, has writtten a profanity-ladened post in which he admits he was at a secret dinner that Techcrunch editor Mike Arrington barged in on. But McClure denied Arrington’s allegations that there was any collusion among the angels to hold startup valuations down. “Unfortunately I probably have more balls than sense, but it drives me f****** [we cleaned up his language a little] insane to see some bull**** superangel conspiracy theory get whipped into a frenzy by people who weren’t there, have no idea what the hell was discussed, and are ready to believe anything when someone yells FIRE!,” McClure wrote. McClure said he considered Arrington to be a friend, but he said Arrington was “dead f****** wrong” about the collusion which makes for “great red meat on Techmeme and Twitter, but it’s just so much horse****.” “If you don’t like it, don’t buy it,” he said.
I’m Still Going Long and Hoping the Markets Go Down First rule of Investing. Dont fall in love with positions or try to prove yourself right. I thought we might get a bounce. I was wrong. I covered my short puts when the market started to shed its gains. So I lucked out there. More importantly, i wanted to clarify my bullishness. Once I made the decision to go long, I didnt just dive in and buy everything I wanted to own. Individuals are capitulating. We are also seeing a corporate margin call reminiscent of the Tech Bubble Burst of 2000. Hedge Fund, Mututal Fund, Exec Selling is pushing supplies of shares far beyond demand. I dont know how low the market will go, and I know this is very self serving, but from a portfolio perspective, the lower the better. We have come down 6,000 Dow Points from the high.
Fire in The Valley, Fire in My Belly... and Yes, Mike, I Have Stopped Beating My Wife So i've been debating whether to write this post all day. Unfortunately i probably have more balls than sense, but it drives me fucking insane to see some bullshit superangel conspiracy theory get whipped into a frenzy by people who weren't there, have no idea what the hell was discussed, and are ready to believe anything when someone yells FIRE! so here goes nothing... first a few clarifications: - mike arrington is a friend, an imposing figure, and a hard-nosed, hard-working journalist. that said, he's dead fucking wrong about there being some story around " collusion" (def'n). makes for great red meat on TechMeme & Twitter, but it's just so much horseshit. - startups & investors bitch & moan about price (aka valuation) all day long, but i don't really give a damn what other people think most of the time. buy or don't buy. negotiate or don't. in short: if it Bleeds, it Leads... and Fuck. naah, screw that shit & lets get back to Collusion cuz that sells newspapers. as for lil ol' me?
Become a Millionaire on $20 a Day Sock away $20 a day, every day, and you'll very likely wind up a millionaire. Not by stuffing it under your mattress, though. Twenty bucks a day under your mattress would give you a million bucks ... after more than 135 years. That's double the normal retirement age! Ten-year Treasury notes recently offered a 4.46% yield. Agree to take on a bit more volatility, though, and you can position yourself to do even better than that. It gets interesting, though, if you're investing using a strategy that has a legitimate chance to beat the market. That's a big "if"Of course, very few investors have reliably outperformed the market over time spans measured in decades. While you and I may never achieve the tremendous level of returns that these masters have earned, their stories show that the market can and has been beaten. If you're going the individual stock route, there is some good news. Brand rank data from BusinessWeek. Get started nowOf course, there's a catch.
AngelGate: Ron Conway Rips 'Despicable and Embarrassing' Super-Angel Investors Ron Conway, one of the most influential venture capitalists in technology, dropped a bombshell on Silicon Valley Thursday by accusing another group of prominent investors of "despicable and embarrassing" conduct surrounding hot startup investments. Conway's attack throws a barrel of gasoline on the rapidly escalating conflagration known as AngelGate -- an alleged conspiracy by a cartel of top early-stage, or "angel," investors to collude and fix price levels for hot tech investments. Techcrunch, which first reported the alleged scheme, obtained a copy of Conway's extraordinary email attack and posted it late Thursday. Conway confirmed the authenticity of the email to DailyFinance Thursday night, but declined to comment further. Earlier in the week, Techcrunch editor Michael Arrington, a former Silicon Valley lawyer, detailed what he described as a plot by angel investors "to keep other competitors out of the market, or to discuss ways to keep prices under control."
AngelGate Goes Nuclear, Startups Get the Fallout: Tech News « Just when you thought the AngelGate fuss — which Mike Arrington of TechCrunch touched off earlier this week with a blog post exposing a meeting of “super-angels” — couldn’t get any more emotionally fraught, legendary Silicon Valley investor Ron Conway upped the ante late Thursday with an email to some of the investors who were at the meeting, calling their discussions “despicable and embarrassing for the tech community.” Among other things, the long-time angel investor asked those at the meeting to remember who they are supposed to be working for, namely the founders of the startups they are investing in. This is a message we tried to get across in a recent post as well, and a point that several other prominent angels and investment funds such as True Ventures (see disclosure below) have also made in blog posts since the AngelGate affair first blew up. True partner Jon Callaghan said it well in a post entitled simply “Founders Come First.”
AngelGate: Who’s Thinking About the Startups?: Tech News « In a blog post that is already making waves in Silicon Valley and throughout the startup community, Mike Arrington says that he recently walked into a secret meeting of the Valley’s so-called “super-angels.” Those are the trendy, not-quite-VCs who invest smaller amounts of money in startups, and who like to make themselves out to be an entrepreneur’s best friend — the kind that knows what entrepreneurs are going through and share their pain by not charging huge fees, etc. Except, according to Arrington, things aren’t always what they seem. The point behind this meeting, the TechCrunch founder says, was to talk about how the super-angels (some of whom may appear on these lists) could consolidate their power within the Valley ecosystem and win more market share away from the traditional Sand Hill Road VC firms. If these reports are true, that doesn’t sound very super at all.
» Founders Come First Posted On Sep 22, 2010 | by Jon The last two weeks have seen incredible ink, time, and venom spread around the competitive dynamics in the super-angel and VC markets. First the “smackdown” news and chatter this week and now Angelgate. While this makes for great press and lots of page views, the voice of the Founder has been absent from virtually all of the discussion and postings. In fact, more than being absent, Founders lose from the shredding and group think and activity happening the market today, and this is a really bad thing. Super Angels and VCs are spending tons of time and energy arguing vehemently that one approach is better or best, all the while polarizing the discussion. A lot of our industry has lost it way in the current environment and on this debate. Moreover, in the words of a friend, startups are a “team sport.”
When Angels Fight, Silicon Valley Loses The latest round of developments in the so-called "AngelGate," including alleged leaked emails and Twitter fails appears to indicate that the situation is more substantial than I thought. As a result, I'm forced to do something unusual--write a blog post without making any jokes. I've co-invested with Ron Conway; I've co-invested with Dave McClure. I've always felt that both of them have entrepreneurs' best interests at heart, and work hard on their behalf. If this "AngelGate" represents a rift between them, this is bad news for the entire ecosystem. The last thing any of us--angel, VC, or entrepreneur--need is a conflict that will get in the way of what we're all trying to do: Create great products and build great companies. I'll admit to enjoying what I thought was a fake publicity stunt; if it has turned suddenly real, I feel guilty of contributing to the sideshow. This is Silicon Valley, not Monday Night Raw. P.S. I thought we ran Valleywag out of town for a reason.