Advanced Equities Financial Gets Socked by Forbes
Back in May, I’d written about Advanced Equities Financial, a Chicago-based investment bank and broker-dealer that’s been ushering a ballooning number of wealthy individuals into late-stage venture deals — and is about to usher in a lot more.
I questioned the firm, and its connections to venture capital firms like Benchmark Capital, Kleiner Perkins Caufield & Byers, ComVentures and a long list of others, whose deals it has been marking up for years.
Unfortunately, I didn’t make the time to dig deeper, and now Forbes has. I could shoot myself for missing this one, but I know a lot of our readers will be pleased to see the story out. (I received more mail about Advanced Equities than almost anything else I’ve written for PEHub.)
Kick back and enjoy; it’s a richly-detailed expose.
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jay cee said on August 19, 2008
The article makes very little sense. I imagine that most VCs have volumes of failures. And because it is a bd and not a blind pool I imagine that the ballooning amount of high net worth investors had a choice in what to invest in especially When the deal flow is coming from the top silicon vally VC’s.
D said on August 20, 2008
I invested with AEI and they asked me if I’m an accredited investor. When I said I wasn’t they told me they could change the documents and make it right. My financial advisor there is Robert Spiegel. Be careful of him.
Mark said on August 20, 2008
I work for a VC firm and received a cold call by Robert Spiegel, what a snake oil salesman.
Jonesy said on August 20, 2008
He told me I could buy the Brooklyn Bridge at a $500 valuation
juatin said on August 21, 2008
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.
SS said on August 21, 2008
Illiquidity…..this is a problem everyone has right now. I am involved with several if, if not a dozen AE backed companies that have over $50MM in Revs. Is that Ultra-Late Stage? Maybe a new category is being created. Senseless journalism.
Culler said on August 21, 2008
As a broker I can sympathize with the beating they’re taking here and it’s totally unfounded. It’s a story about nothing. Like Seinfeld. I hear commercials all the time now about these BS law firms offering to get your money back lost in the stock market. Whats next, attorneys fighting to get your money back from your trip to Vegas last weekend?!?! I mean, come on!!!!
Bottom line is this was a cheap article. I’m honestly shocked Forbes ran such drivel. Then again its August and I’m sure they’re hurting for ideas right now. Proof positive, this new issue is super thin.
Anyone can tell you there is an absolute drought in the IPO market right now. Once the market swings back let’s see what happens. Let’s see how many of AE’s deals go public then. Then write the article and give me your doom and gloom statistics.
Furthermore, let us keep in mind AE isn’t pulling these deals out of the clear blue sky. They’re working with the same deals as the big boys on Sand Hill Road. Lets see Forbes print a smear story about the Menlo Park mafia. It’ll never happen.
What’s more, Forbes voted Mr. Daubenspeck #72 on their coveted yearly Midas List 2008! How dumb do they look now?
I seriously think the editors were asleep at the wheel when he Okayed this story. You can’t shake with one hand and stab me in the back with other.
I’m really disappointed with Forbes on this one. This is like supermarket tabloid journalism masquerading as some high-falutin’ expose
Stock Diva said on August 21, 2008
Connie – With the kick back expose comment it really feels like you have an axe to grind? What happened between you and Advanced Equities?
Please help me to understand why would the Kleiner’s & Khosla’s screw over a firm that helps them at critcal inflection points of a private company? I sense that this will not hold water. My conversations and dealings with the San Francisco office have been good and there is a lot of solid comments here:
http://venturebeat.com/2008/08/21/advances-equities-takes-its-investors-on-a-bad-trip/#disqus_thread
I would like to understand DAG ventures and who are they? I feel they fly under the radar yet they invest in the same arena as shown in the venturebeat site??
Disclaimer: Yes I have a vested interest with Advanced Equities succeeding because I have $$ in these companies. I have to root for the home team!
PEHub Administrator said on August 21, 2008
It should be pointed out that Jonsey, Juatin and Culler are all posting from the same IP address.
-dan
Stock Diva said on August 22, 2008
Who is Ron May? Sounds like he is behind this slanderous forbes article and why would he put these reports up to it?
Attorney’s will have a hey day with this if the article written is not factual.