In 2019, Matthew Scullion, founder and CEO of U.K. startup Matillion, faced a decision about which term sheet to accept for the lead investor in his company's $35 million Series C financing round. Would the connections and opportunities offered by Silicon Valley-based VC Battery Ventures make up for its lower valuation offer, or would Scullion be better off choosing a European investment firm to lead the round?
Set in January 2021, the CEO of SafeGraph, a four-year-old startup that sold Data as a Service, looked to the future. His aim was to become the most trusted source for data about a physical place. The company provided points of interest (POI) and foot traffic data on nearly 7 million businesses in the U.S. and Canada from a variety of providers, then labelled attributes of the data such as the brand affiliation and how long consumers remained at the site. The company sold this data to nearly one hundred customers in advertising tech, retail, and financial services. Clients such as Verizon, Sysco, and Goldman Sachs used it to better understand rapidly changing patterns of consumer behavior. At the outset of the COVID-19 pandemic, the company offered free access to its data through the COVID-19 Data Consortium to government agencies to help them understand pandemic behavior and make policy decisions. Nearly a year into the health crisis and with a vaccine rolling out, SafeGraph needed to decide how to evolve the COVID-19 Data Consortium. Perhaps the data offered for free should soon be converted to a paid model, albeit on a subsidized basis? More broadly, how should the team prioritize the government sector into its enterprise customer segment mix and how would this impact the business model and pricing?
With long development timelines and high risk, new energy technologies were often left to languish in the "valley of death," unable to raise enough funds to bring a product to market. In 2014, Sarah Kearney founded the nonprofit Prime Coalition to solve this problem. At the beginning, Prime's role as a financial intermediary involved seeking out the most promising market-based technology solutions to climate change and recruiting foundations or philanthropists to fund them. In 2019, Prime changed course, adopting a portfolio approach with its Prime Impact Fund. By the end of the year, Prime had raised $40 million in philanthropic capital for its new fund. Once the funds were invested in promising energy startups, Prime planned to try its hand at recruiting traditional investors to back the same companies. Could Kearney convince traditional investors that these investments were worth the risks?
While still a general partner at Silicon Valley-based New Enterprise Associates (NEA), Ravi Viswanathan considered the challenges presented by evolving market dynamics in the venture capital space. Startups were staying private longer, which led to limited partners thirsty for liquidity and venture capital funds managing overloaded portfolios. Viswanathan and the senior leaders of NEA orchestrated the purchase of 31 NEA unrealized portfolio companies by the newly created $1.35 billion NewView Capital spinout that he would head. This secondary transaction provided liquidity to NEA's limited partners and reallocated NEA partners' time to shepherd other portfolio companies, while at the same time allowing NewView Capital to reap gains from future exits from a portfolio of diverse, high-quality growth stage technology companies. Now, as he prepares to raise Fund II, Viswanathan acknowledges that the unique circumstances that enabled the launch of Fund I would not be replicable, and he must consider alternative strategies to pursue next. Should he continue to focus on secondary transactions, focus on direct investments, or some combination of the two?
In 2018, Initial Coin Offerings (ICOs) were an emerging fundraising method for blockchain-based projects. As the ecosystem grew, there were many open questions on regulation, pricing, and even which projects were a good fit for blockchain. However, there was already some emerging consensus on the benefits and challenges of building with blockchain and emerging best practices for Initial Coin Offerings.
Accomplice, an early-stage venture capital firm based in Boston, is raising its second fund in November 2017. Since 2009, the firm has followed a seed-led investment model, investing in tech companies at the earliest stages, often when products and business models are still experimental. The firm's partners are pleased with their preliminary returns and the deal flow they've been able to cultivate, in part by empowering local entrepreneurs to invest in promising new ideas on their behalf. The partners are confident their long-term returns will validate their investment strategy and positioning in the increasingly competitive VC market. Will investors agree?
In October 2016 SoftBank Group Corp., the Japanese conglomerate giant caused a significant shock to the worldwide market for venture capital and private equity by announcing the Vision Fund, the largest tech investment fund in the world at close to $100 billion. The reputation of legendary SoftBank CEO Masayoshi Son depended on the success of the Vision Fund, a considerable challenge given the difficulties associated with organizing a large pool of capital, investing at scale and generating VC-style returns. By effectively anointing category leaders and deterring competitive entry, would the Vision Fund accelerate innovation or undermine the market forces that have typically produced social value by spurring rapid technological change?
In December 2012, less than two years into the founding of their music-streaming platform Anghami, cofounders Elie Habib and Eddy Maroun found themselves evaluating an unorthodox term sheet. Habib and Maroun needed to make a decision vis-Ã -vis the proposal put forth by the MBC Group, the region's largest media network. The offer was a media-for-equity deal, which would provide Anghami with advertising towards the media giant's millions of viewers and boost its chances of competing with the likes of iTunes and Spotify in the Middle Eastern market. However, the deal would also cost the cofounders a significant share of their company, and might place them in the middle of a rivalry between MBC and Rotana, the region's largest music label. The case takes the reader through the co-founders' journey, from the founding of the company to the successes and challenges they have faced navigating product launch, scale-up, and partnerships.