09:36 AM

Mind the Gap: Venture Capital's Exit Problems

 Don Dodge points to some interesting VC figures on his blog that can be summarized as:

Exits have averaged $18B over the past 6 years while investments have averaged about $40B over the same time period.

Link to Don Dodge on The Next Big Thing

For every $1 invested only 45 cents is returned through the sale of a startup or through an IPO. (Maybe all those Web 2.0 investments will pull the funds out of the ditch?)

So I guess VCs should be happy to get what they can from selling their portfolio companies to the big players such as Microsoft, IBM, SAP, Oracle, etc.

Don says:

Microsoft acquired as many companies as Google and Yahoo combined. Microsoft acquired 19 companies last year. Google acquired 10 and Yahoo acquired 9. IBM also acquired 9 companies. Of course Google spent more on acquisitions, spending $1.65 Billion on YouTube alone.

Link to Don Dodge on The Next Big Thing

If you don't know Don:

Don is currently Director of Business Development for Microsoft's Emerging Business Team. The goal is to help VC's and start-ups be successful with Microsoft, and together, provide great products for our customers.       Don Dodge