A Tale Of Two VC Industries: The Web Versus Cleantech. Last week, venture capitalist Fred Wilson wrote a post pointing out that the VC industry is split in two: software-based businesses and everything else (specifically, “cleantech, biotech and other capital intensive businesses”).
Software businesses don’t require as much capital as they once did, and certainly not as much as cleantech or biotech. In fact, I’d go so far to say that the main asset venture capitalists bring to the table for Web startups is no longer capital, but rather connections, advice, and deal-making prowess. Whereas for greentech and biotech, the capital is still the most important thing they bring to the table. Wilson concludes: Private Equity Continued to Outperform Venture Capital in the First Quarter of 2010, Though Returns for Both Asset Classes, While Positive, Trailed Public Market Returns. BOSTON, MA -- (Marketwire) -- 09/14/10 -- Returns for private equity and venture capital funds remained positive for the fourth consecutive quarter, which ended March 31, 2010, and continued to benefit from improving valuations for public equities.
However, first quarter performance for both private asset classes was lower than in either of the two previous quarters. Also for the fourth consecutive quarter, private equity outperformed venture capital; both, however, lagged public market returns during the first quarter and for the 12-month period ending March 31, according to Cambridge Associates LLC, provider of independent research and investment advice to institutional investors and private clients. Private Equity Continued to Outperform Venture Capital in the First Quarter of 2010, Though Returns for Both Asset Classes, While Positive, Trailed Public Market Returns. PricewaterhouseCoopers: Global: Insights & Solutions: MoneyTree™