Eliminating the “Man”: Launch of Series Seed Documents

By Taryn Cooper, at 2:03 pm on March 2nd, 2010

The rejoicing you may be hearing today are entrepreneurs and potential start-up financiers cheering the launch of Series Seed Documents, a service to help new companies raise funds without tons of legal fees and documentation involved.

Spearheaded by VC stalwarts Andreessen Horowitz, First Round Capital, Charles River Ventures, and True Ventures, the idea is that being that it now costs less to build a tech product, first round funding is usually more prohibitive with legal fees going up but funding rounds not being as high (going from $5 mm to $20 mm for first rounds to as little as $500K to $1 mm to generate).  According to Mark Andreessen, these documents are necessary for several reasons, as he explains below:

“What hasn’t changed is the process by which funding rounds get done. So what’s been happening is entrepreneurs have been finding that if they raise money from angels, that’s fine, but VCs will often try to use their full standard processes, even for small rounds. That can mean a lot of legal negotiations and legal fees, because [standard term sheets] are really complicated. Historically, that’s worked to VCs’ advantage, but it’s not good for entrepreneurs.”

First round funding can still be negotiated even using this documentation, however removal of the “middle man” (meaning: lawyers who are generally the few who profit from these negotiations) can be beneficial for the next Sergey Brin or Biz Stone who is looking to start their next big venture.

Face-Off: Microsoft vs. Google

By Taryn Cooper, at 1:12 pm on March 1st, 2010

In the spirit of yesterday’s closing ceremonies at the Olympics, I would say that — much like Team Canada vs. Team USA — a turf-war has erupted between two American-as-Apple-Pie tech companies.  Perhaps you’ve  heard of them.  We have “Microsoft” on one side, and another named “Google” in the defensive zone.

Microsoft has been incredibly vocal with its accusatory stance against Google, suggesting their business is anti-competitive.  Microsoft is no stranger with being accused of monopolistic practices, back in the late-90s going through that themselves.

The thing that stands out to me is whether Microsoft should care or not.  Let’s be fair, these two companies are like Goliath vs. Goliath.  While there is healthy competition in the technology space, each is successful and has their niche in their own right.   While they have similar products, typically Microsoft and Google target different populations but are potentially each other’s biggest competition.

I can’t say whether Microsoft is simply picking on Google because they can, but it seems interesting to me that several outlets today have picked up the idea that Microsoft is encouraging victims of Google to file complaints with regulators on their anti-competitive practices (an idea, that by the way, Microsoft is denying).

It appears as though Google is getting their licks in the media — you know, the whole saying of building something up just to tear it down, etc etc.   And with it’s trouble in China, along with its Google Books drama in the U.S., Microsoft’s deputy general counsel Dave Heiner also wrote in a blog post today that “Google’s way of working with advertisers and publishers makes it hard for Microsoft’s competing Bing search engine to win search volume.”

I wonder how long it will be before Google starts taking its public licks, much like Microsoft did in the late-1990s, for being the monolith it was but it’s still standing and of course, won’t be going away anytime soon.  The same could be said for Google, as it’s going through it’s growing pains of falling out of favor.  We’ve seen evidence of this recently with public fall-out from it’s Buzz launch, which had many more “ifs” involved in its release than answers.  To me though, I think that Google will walk away from this unscathed, as they have a team of lawyers working for them to ensure that whatever may happen quickly goes away.

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Another Manic Monday…of Mergers, That Is

By Taryn Cooper, at 12:13 pm on March 1st, 2010

I have to admit, after working for years on an investment banking floor, I still get riled up on Monday mornings when deals are announced.  Oh boy, were they announced today!

Out of four high-ish profile announcements, AIG selling its Asian unit to Prudential plc, Merck KGaA buying life-science company Millipore, Astellas Pharma submitted an unsolicited bid for OSI Pharmaceuticals, and MSCI agreed to acquire proxy advisory firm RiskMetrics.  Those four deals along provided about $50 billion in transaction value to the league tables this morning.

The AIG deal was valued $35.5 billion.  I’m not certain what kind of sign this is for AIG — garbage in, garbage out?  Whatever the case, $35.5 billion is not something to shake a stick, whether or not this is perceived to  be a strong subsidiary that they could get some value from.

What interests me are the pharmaceutical and healthcare consolidations, usually signifying a “healthier” economy (not “healthy” just “healthier” by  most standards).   When you see consolidations in this industry, “they” will come (meaning: investors, driving up the markets!). In fact, as we speak, drug stocks are reported to be “stoked” by this merger activity.

An unsolicited bid, which is just a nice way of saying “hostile” (though technically, a hostile bid is when the target formally rejects the acquirer’s offer), leads me the acquisition of proxy advisory firm RiskMetrics.  RiskMetrics is a great tool to view how strong companies are, regarding their board and internal structure, who may be vulnerable to unsolicited or hostile targeted bids.  MSCI is an interesting acquirer of this set as they are index focused and potentially looking to  build out their index portfolio with a purchase of Russell Investments after a failed bid for the famed Dow Jones indexes.

All in all, a healthy Merger Monday is a good sign of things to come.  That and sun after a particularly blustery weekend!

CBS May Cut TV Show Download Prices – Apple to Win?

By Jim Di Liberto, at 4:37 pm on February 19th, 2010

CBS may give in the the Steve Jobs beheamoth and cut its prices for TV episode downloads to $0.99 from $1.99.

CBS May Cut Download Pricetags – Another Win for Apple?

By Jim Di Liberto, at 4:33 pm on February 19th, 2010

Apple is notoriously hard on media companies, using its stranglehold on content distibution – the iTunes store – to bully Old Media in a way that would make a ’90s-era Bill Gates blush.  They have long tried to get the big networks to reduce the price of TV episodes to $0.99 from $1.99.  On the one hand, this seems like a coup for Apple, reducing a full episode of television — from 30 minutes to an hour — to the same cost per download as a 3 minute track from Lady Gaga.  You kinda have to feel for the networks, right?

Maybe not.  Lets look at the actual numbers.  At $1.99, it costs $43.78 to download an entire season of How I Met Your Mother – which is TWICE the comparable cost for the full-season DVDs at Amazon.com ($19-$23). Granted, for that 100% markup, you are getting the benefit of buying brand new episodes, rather than ones a year or more old. Is that difference in timing worth twice the price?   So far, the networks have been assuming so – but, in the age of Hulu, will audiences continue to agree?