With July 4th approaching, the unofficial summer is about to begin. In almost every board meeting with portfolio companies and other entrepreneurs who are raising money, I’m hearing the same refrain: “My VCs are about to shut down for the summer.” Phone calls and emails won’t get returned, partners meetings won’t be held, and you might as well put your head down and build your company as best you can and then show up after Labor Day rather than wasting time knocking on VC doors.

I admit this is only my 7th summer as a VC, so I’m still new to this thing, but I just don’t get it. I still work during the summer. My partners work all summer. My co-investors and their firms seem to be working all summer. And even when I’m on vacation at ...

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The debate is heating up about the impending regulations from the government applied to Private Equity (PE) and its sub-class Venture Capital (VC), fought by the National Venture Capital Association (NVCA) and reluctantly supported by the Private Equity Council (PEC). The latter stating that private equity does not represent a systemic risk. Perhaps not, if the council excludes VC from its membership, but VC as Private Equity poses a systemic risk as the gatekeeper to innovation.

Why the government is forced to step in
The government has decided to step in and we, as participants in the ecosystem should present our government with the facts (good and bad) so it can make informed decisions going forward. If we give the government self-serving information, rather than the fac...

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I was disheartened to read the following in a recent trade column: “Fundraising is fast becoming a modified version of Cloak and Dagger, pitting GPs vs. LPs.” The phrase “cloak and dagger” conjures images of spies, deception and assassins. How did relationships founded in the concept of trust fall into such language of distrust?

As fundraising has become more challenging, more of our clients have elected to create or enhance their focus on improving relationships with their existing and prospective LPs. The demand for Investor Relations professionals has been growing dramatically and we have been developing these roles with many clients concerned about their short- and long-term fundraising success. Not too long ago, I attended a panel discussion on How to Improve LP/GP Relationships. At the time, I wondered how this panel discussion could possibly last longer than a couple of minutes. In my mind the answer was, “Be nice to the people who give you money” and “Be nice to the people who make you money.” It seemed like an easy open-and-shut kind of session.

To paraphrase the opening lines from the movie Casino, Robert DeNiro says; "When you trust someone, there is no other way. You give them the keys to everything that's yours, otherwise what's the point.” For me, those words sum up a lifetime of relationships for the very essence of any relationship is quite simply, trust.

Having been helpful to a number of private equity and venture capital firms in staffing their existing or newly formed Investor Relations teams, here are seven tips for how to improve those relationships.

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There has been a great deal of recent press regarding the gulf between buyers and sellers of private equity interests. The disconnect is usually attributed to some analytic model—the vagaries of FAS 157, a lack of information, uncertain outlooks, etc.

As a buyer of private equity interests, I believe that there is validity to many of the commonly-cited explanations. Nevertheless, focusing on the financial metrics alone imagines a world in which price is the only driving force in markets. It is important to remember that institutions never sell private equity. People within institutions sell private equity. Many of the individuals tasked with managing private equity portfolios have recently suffered through traumatic professional experiences. Buyers of private equity need have patience and understand the personal nature of private equity partnerships.

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VCs lamented the dead IPO market 'round the clock at the AlwaysOn Venture Summit two weeks ago, where the theme of conference was the search for liquidity. Yours truly participated on one of three panels dedicated to raising the four horsemen from the dead. The NVCA has published a position paper on the national IPO crisis, recognizing the need for a viable underwriting ecosystem -- and even calling for government intervention. So we are to understand that VCs, in their infinite wisdom, altruism and patriotism recognize that a sound IPO market is critical for the economy. So critical, in fact, that they are ready to champion government involvement to fix the machine.

I completely agree that our IPO market needs fixing. But the venture community needs to get out of its Aeron chair and pitch in before calling the “Obama Phone.”

Benchmark, Integral and Impact threw another shovel of dirt on the IPO market with OpenTable, when they paid 70% of the deal fees to Merrill Lynch – a firm that is too big to care about small cap IPO’s. Does anyone with half a brain think that the OpenTable deal fees will have any effect on Merrill’s allocation of resources? Big banks like Merrill, Goldman, JP Morgan, Morgan Stanley can not afford to focus on the small-cap IPO market. You don’t need a calculator to do this math!


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* The death of PPIP may have been greatly exaggerated. CNBC is reporting that it will be unveiled tomorrow, with participants to include WL Ross and a joint venture between GE Capital and Angelo Gordon.

* Jason Mendelson reacts to the Polachi study: Apparently 52.9% of VCs are deluded.

* Morning Call: U.S. futures point higher, London opens flat, European shares target best quarterly gain since 1999, the Nikkei closes its best quarter since 1995 and Hong Kong is on holiday.

* Q&A with Benchmark Capital's Bill Gurley, including the deals he shouldn't have passed on.

* Roger Altman: We'll need to raise taxes soon.

* Business has not been good to ex-basketball star Christian Laettner.

* Sign of the Apocalypse: Vin Deisel makes his first appearance in this space (and on the same day as Christian Laettner...)

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Global private equity deal volume for the first half of 2009 was $32.9 billion, according to data being released later today by Thomson Reuters. It represents the lowest opening six months for any year since 1997.

Second quarter volume was just $15.1 billion, compared to $17.8 billion in Q1. Overall, financial sponsors accounted for just 3.5% of announced transactions in the first half, which is the lowest such percentage since the first half of 2000.

Update: Get all the data after the jump.

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Recently, New Enterprise Associates went ahead with plans to lease a stunning 25,000-square-foot office on Sand Hill Road for its 45 West Coast partners, associates, and administrative staffers. 

It was a notable upgrade for NEA, which had been leasing roughly 13,000 square feet in two buildings across the street, where most of the venture firms in Menlo Park — including Kleiner Perkins, Benchmark Capital, and Sequoia — are housed in a sprawling mass of low-slung and nearly identical buildings.

Yet it appears that NEA is the only private equity firm that’s right now willing and able to upgrade to such a colossal office – one that’s part of a newly completed, $200 million, 21-acre, Stanford University-owned development featuring four 25,0...

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In February 2008, Jeff McDermott asked his eldest son about what he might someday want to do for a career. “Wall Street, because it’s been so good for our family,” answered 14-year-old Dylan.

McDermott paused. Wall Street had indeed been good to his family. He had risen to co-head of UBS investment banking, before stepping down in March 2007 to pursue new opportunities. But he also had “gotten wet in a thunderstorm,” leaving business school during the financial industry’s Golden Era. Had he been drawn to automobile manufacturing, McDermott realized, his family would not have been so fortunate.

“I told him that I was in the right place at the right time, because Wall Street was growing and changing so fast,” McDermott says. “My son asked what that industry is now, and I said that, were I his age, I’d think about cleantech, because there is a real societal move toward sustainable living, and there are lots of new companies forming that will eventually consolidate. Plus, Dylan loves science. Then I stepped back and wondered why I wasn’t applying that same advice to myself.”

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More than half of venture capitalists (52.9%) believe that their industry is “broken,” according to a survey conducted by executive search firm Polachi Inc. Moreover, nearly 60% said that they are less confident in the VC industry today than they were six months ago.

Below are the survey results, or click here to download them:

Polachi_VC_Survey

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