Show Us the Money!
To some degree, venture capitalists are thrill seekers and lately the tried-and-true business software sector-- where the biggest chunk of venture money goes every quarter-- hasn’t been too exciting. After several waves of big company-changing software like those automating customer service, back-end manufacturing, and the like, most of the innovation in software of late has been filling gaps or in over-funded areas like security. I think I speak for reporters everywhere when I say, “Yawn.”
Meanwhile, there’s plenty exciting going on in consumer products—yes, even beyond the miraculous iPod.
This hasn’t been lost on the Silicon Valley lot and for the past few years I’ve heard more and more VCs talk about doing deals in the consumer space. Having been burned on capital intensive hardware companies in the past, it’s usually prefaced with disclaimers that they won’t be investing in companies that make the final product and have to build a pricy brand, but something that goes into the device, like a super fuel efficient chip.
But a lot of the partners who say they’re looking for a deal like this haven’t found a good one yet. (Or they aren’t talking about them.) Enter this year’s Consumer Electronics show. I’m hearing more and more reports about VCs attending what used to be a pretty ignored event among their ilk. A Jan. 12 posting on VentureBlog by David Hornick describes CES this year as almost a venture capitalist reunion, saying, “We might as well charter giant cargo planes and move all of Sand Hill Road to Las Vegas for the convention.”
I, for one, am anxious to see what new ideas or deals percolate from all that networking. It seems like some VCs talk a good game about consumer but are still licking past wounds, uncertain how to dive in.
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