Day: May 29, 2019

B2B vs. B2C IPOs



For the past dozen years, Top Tier Capital Partners has believed that using data wisely can potentially help us to “see around corners”. Venture capital is an industry enshrouded in secrecy, making it difficult to determine what is happening in the world of private companies. The intersection between this part of the market and the public markets makes for interesting hypotheses.

With the recent onslaught of IPOs, we started to see a trend emerge. It appeared that business to business (“B2B”) companies enjoyed stock price increases post-IPO, while business to consumer (“B2C”) companies were facing head winds.  We went to the data and found that not only does this appear to be true, but the B2C companies actually revert back to the valuation of their last private round.

The data set is small, with only 32 technology IPOs in 2018 and 2019, but we found that while B2C companies enjoy higher valuations, the multiple between the last private round and the market cap at the end of the lock-up is 0.7x. This means the company valuation decreased 30%.  The same methodology for B2B companies shows a multiple of 1.8x. As the below graphic shows, B2C companies bounce back a bit after the lock-up, but only to a valuation around that last private round.

There are a few reasons why this might be true. B2B companies typically have more stable revenues while B2C companies are more subject to consumer trends. Consumers are known to change their minds more often than businesses. (Read more...)

Investor Stories 113: Lessons Learned (Tananbaum, Ascher, Nahm)



On this special segment of The Full Ratchet, the following Investors are featured:

  • Jim Tananbaum
  • Brian Ascher
  • Tae Hea Nahm

Each investor illustrates a critical lesson learned about startup investing and how it's changed their approach.

To listen more, please visit http://fullratchet.net/podcast-episodes/ for all of our other episodes.

Also, follow us on twitter @TheFullRatchet for updates and more information.

 

Investor Stories 113: Lessons Learned (Tananbaum, Ascher, Nahm)



On this special segment of The Full Ratchet, the following Investors are featured:

  • Jim Tananbaum
  • Brian Ascher
  • Tae Hea Nahm

Each investor illustrates a critical lesson learned about startup investing and how it's changed their approach.

To listen more, please visit http://fullratchet.net/podcast-episodes/ for all of our other episodes.

Also, follow us on twitter @TheFullRatchet for updates and more information.

 

Scaling tips from John Chambers: Part 1 – Spotlight on culture and talent


This post is by Philippe Botteri from Cracking The Code



For the leader of any fast-growing company, every day brings a new challenge. A CEO has to manage issues of strategy, culture, talent, customer service and reputation – often all at once.

At VivaTech last week, we got an insight into the first-hand experience of John Chambers who was CEO and Chairman of Cisco from 1995-2017, and who now invests in early-stage tech start-ups around the world, with a particular focus on mentoring emerging leaders. John was joined in a roundtable discussion by Joe Schoendorf, a former Accel partner who has held senior roles at companies from Hewlett Packard to Apple, and who served on the board of the World Economic Forum.

In this first extract from our roundtable, they share their experiences in shaping company culture and handling negotiations with top talent. 

What is the secret to building a robust company culture?

Joe: A leader plays such an important role in setting the culture of a company and communicating it. Jack Welch used to say, “culture is nothing more than the length of the shadow of the CEO”.
In my time at HP, new recruits had a week’s training that concluded with a speech from David Packard. He would always say that, if your business gets into trouble financially, we will give you eight quarters to fix it. If you have people problems, we will give you eight seconds. That is culture from the top.   
John: As a CEO (and/or founder), you have four areas (Read more...)

Scaling tips from John Chambers: Part 1 – Spotlight on culture and talent


This post is by Philippe Botteri from Cracking The Code



For the leader of any fast-growing company, every day brings a new challenge. A CEO has to manage issues of strategy, culture, talent, customer service and reputation – often all at once.

At VivaTech last week, we got an insight into the first-hand experience of John Chambers who was CEO and Chairman of Cisco from 1995-2017, and who now invests in early-stage tech start-ups around the world, with a particular focus on mentoring emerging leaders. John was joined in a roundtable discussion by Joe Schoendorf, a former Accel partner who has held senior roles at companies from Hewlett Packard to Apple, and who served on the board of the World Economic Forum.

In this first extract from our roundtable, they share their experiences in shaping company culture and handling negotiations with top talent. 

What is the secret to building a robust company culture?

Joe: A leader plays such an important role in setting the culture of a company and communicating it. Jack Welch used to say, “culture is nothing more than the length of the shadow of the CEO”.
In my time at HP, new recruits had a week’s training that concluded with a speech from David Packard. He would always say that, if your business gets into trouble financially, we will give you eight quarters to fix it. If you have people problems, we will give you eight seconds. That is culture from the top.   
John: As a CEO (and/or founder), you have four areas (Read more...)