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Venture capital

  • How to safeguard your intellectual property

    Intellectual Property (IP) is an intangible asset to an entrepreneur. When it comes to assuring investors they are placing their cash in an exclusive product or service that is legally protected, securing your IP is a must. Alex Fraser of Invenfin, an early-stage venture capital company says there are some things you need to know before you take your idea to investors. According to Fraser, not having proper IP ownership is by far the largest problem Invenfin sees when dealing with the thousands of entrepreneurs that pass through its doors. Fraser, who lectures on entrepreneurship and venture capital to students,...

  • Exclusive: Major int’l VC stealthily buying into SA eCommerce sites

    A major US$3.5-billion New York-based hedge fund headed by investor Lee Fixel has been quietly buying up some major eCommerce properties in South Africa over the past five years. The New York-based Tiger Global Management LLC, which recently invested US$20-million in business social network LinkedIn and US$80-million in Facebook, now holds a stake in the country’s largest online auctions site, Bid or Buy. Add to that a growing portfolio that includes key...

  • Where in the world is CrowdFund?

    Almost a year ago, or eleven months ago to be precise, a brilliant crowd-based angel investment project was introduced to the South African tech startup stage, called Crowdfund. The idea, started by well-known web strategist Eve Dmochowska, included big plans for crowdsourcing funds for worthy local startups. The idea behind it all was to provide the capital, know-how and networking capability required by young entrepreneurs to launch prototypes of their ideas, in exchange for equity -- a dream come true for any entrepreneur. Dmochowska’s project shot off the starting blocks like Usain Bolt at the Olympics. By the end...

  • Could Chinese venture capital back African innovation?

    Chinese venture capitalists have clearly stated their desire to see the success of the western venture capital process replicated in their country. State and private firms have begun to take initiatives and institute policy reforms in recent years in order to meet that target. The Hualu Group, one of the biggest Chinese state-owned enterprises which focuses on the audio and video industry, has been quietly forging ahead in the tech sector. In 2010...

  • How to lose a VC funder in one sentence

    Raising funding for a new venture is always difficult. Entrepreneurs going down this road will have to shrug off many pessimists and naysayers along the way.... but sometimes they are their own worst enemies. As a venture capitalist you need to have a great sense of humour as you wade through your dealflow. We receive written requests for backing all the time, and we've kept some of the gems and put together a list of actual funding requests received by PoweredbyVC, a leading South African Venture Capital company, between July and December 2010. Because of confidentiality, some info is...

  • Facebook IPO: ‘Suddenly it feels like 1999’

    The high valuation of Facebook on secondary share markets might be out of line with its revenues but it does show one thing: A large investor appetite for investing in leading Silicon Valley companies. The fact that the investors are making large bets without having access to the underlying financial information is similar to the wild days of the dotcom boom, when companies were able to IPO on the basis of very little...

  • Insights from a VC: Social networks overdone, but storage is hot

    I spoke with Bob Ackerman, managing director of US-based Allegis Capital and a veteran Silicon Valley venture capitalist about some of the trends and issues in VC. Here are some of his insights on the key issues: - Cloud will be big this year and a big buzzword and that worries me because there will likely be too many companies funded that shouldn't be. - Storage is another hot area simply because of the massive amount of data being created daily and the need to make it available online and searchable. - Social networks are overdone and over invested. There have been too...

  • Why Angel funding is killing innovation

    I'm a fan of Max Levchin and his fellow Paypal alumni because this group has spent the past five years creating many of the more interesting Silicon Valley startups. Levchin recently sold Slide to Google and he is an investor in Yelp and several other startups. And he is still young and has a lot more to add to his Wikipedia page before he is done. Levchin writes on his blog, but only very...

  • VC: ‘If you can’t describe your business in a tweet, it’s not a business’

    PoweredbyVC is a venture capital fund based in Cape Town, initially established in 2010 by members of emerging market investment group Here Be Dragons (HBD) -- the company created by famous internet entrepreneur Mark Shuttleworth. PoweredbyVC now runs HBD's portfolio, and is always on the lookout for businesses to invest in. Keet Van Zyl, executive director at PoweredbyVC spoke to Memeburn about what he looks out for in a startup, discusses the investment environment right now and delivers some sound advice for young entrepreneurs looking to attract venture capital. MB: Is this a bad time to be looking for...

  • 7 reasons to bootstrap: Angels, VCs or none of the above?

    The venture capitalist (VC) community is disdainful of angel investors and their puny funds, but the angels can do deals that VCs cannot because they are too small for the large funds. Today's entrepreneur has a choice: Angels or VCs or none of the above. It's worth considering the "none of the above" option because startup costs are very low. Joe Kraus, co-founder of Excite, which was the Google of its day, told me...