PR Watch: Outcast dinner party Part II -- bits and bites…
Let me rush through the dinner highlights:
Margit and Caryn took the stage to welcome the guests, and they both looked fabulous. They attempted a joke about how Margit, being from Germany, did not know the term “home plate” and thought it was a type of food plate. It’s quite understandable—Margit seems to be on some kind of super Atkins—so she might get a little hungry occasionally.
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I was delighted to find that Gary Reback, Silicon Valley’s top lawyer IMHO, was seated at my table. In the 1990s, Gary helped to set in motion the antitrust complaint against Microsoft, which led to the government winning the case. He has just finished with the PeopleSoft court case, is working on a book, and is looking for his next challenge.
He’s very concerned about Washington D.C, and that the legislators do not understand the technology business. This could lead to problem regulations or ineffectual legislation. Gary is not one of those lawyers that chase after the dollar—he really wants to make a big contribution on large issues.
When I was at the FT, I had the scoop on Gary’s comeback into the law profession. During the dotcom boom Gary founded a communications technology startup company called Voxeo, and became its chief executive. “I wanted to have the business experience of running a startup, but, as CEO, managing teams of software engineers was a lot harder than I expected. And as for dealing with our lawyers....I can understand why lawyers are often so disliked.”
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The indefatigable Tony Perkins, founder of AlwaysOn, Red Herring, Churchill Club, etc, etc, was at the party. I mentioned that he seems to have a ton of stuff going on right now with AlwaysOn. He is launching a quarterly magazine, there is a blog magazine, conferences, etc. “I feel that we’ve come to a stage now where we can monetize our efforts,” he said. Monetizing content is a huge challenge and I hope Tony figures things out—because then we can all benefit from examples of successful online media business models.
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I had an interesting chat with David Helfrich from Garnett & Helfrich Capital. David made his money the traditional Silicon Valley way by working at startups that were then sold for large sums to larger players. This put him into the venture capital business for several years. His focus now, however, is not VC investments, but on financing deals with private, medium sized companies. He says such deals can be very complex---which keeps out the competition.
Mr Helfrich said he got out of the VC business because it hasn’t changed in years and it is not producing the value it once did. He said there are too many VCs living off the very generous fund management fees and doing little in return. I heartily agree--if you have a $1bn fund and the management fee is 2 per cent, the VC team doesn’t need to worry too much about eating, or finding a roof over their heads—or risky investments. I think the investment landscape has changed tremendously in Silicon Valley, yet the VCs are still doing business the old fashioned way. They are still following a herd mentality and seem bereft of good ideas.
It is networks of Angel investors, such as TIE and Silicom Ventures that are going to be the major beneficiaries of the changes occurring —but more on that topic later…
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In the Redwood room later on, it was always a pleasure to chat with the very tall Cory Johnson, Silicon Valley business reporter for CNBC and a familar talking head to many. (I’m hoping he can introduce me to Maria at some point!)
I didn’t hang around too long—although I do remember demonstrating the inherent instability of a Manhattan cocktail to Joe Fay, US editor of Computerwire, using part of his shirt in the demo. BTW, Joe might be leaving Computerwire soon, which would create an internal power vacuum, one that the young but ambitious Kevin Murphy, Computerwire reporter, would like to fill.