October 4, 2013 - The 10 year time horizon of the US Venture Capital Index ® by Cambridge Associates LLC continued its improvement in Q1 2013 to 7.8%. However, due to a resurgence in the public markets, average venture capital performance fell slightly below the public indices in the sub 10 year time horizons. The Late Stage US Venture Capital Index still outperformed the public indices in the five year time horizon, while the Early Stage Index continued to outperform dramatically over the 15 and 20 year periods.
October 4, 2013 - The fiscal tragedy playing out in our nation's capital will have real consequences, both intended and unintended, in the days, weeks, and months to come. At issue are two critical elements: the federal budget and the debt ceiling. While these are two distinct and separate concerns, the political climate is such that neither topic will likely be resolved before their respective deadlines.
October 2, 2013 - Five years ago we found out who was not too big to fail. Lehman Brothers went down on September 15, 2008, with over $600 billion in assets, setting off a remarkable chain of events. A few days later John McCain suspended his presidential campaign and flew to Washington, D.C. where he generally made a fool of himself, thus removing any doubt about the outcome of the election in November.
October 1, 2013 - At Square 1 Bank, we’re dedicated to the start-up marketplace. As lenders, we focus on working with institutional venture capital firms and the companies they fund. Lots of those companies are still developing their product or service. Others have reached the point where they’re figuring out how to attack the market, and still others are working to maximize profitability.
October 1, 2013 - There is no way to talk about venture debt without bringing up the notion of financial covenants. The simple mention of the word “covenant” evokes a connotation of doom and fear in the hearts of many entrepreneurs and equity investors alike. This dread is perhaps caused in part by horror stories of overzealous lenders using a covenant trip to invoke remedies (read: sweep cash or foreclose on assets), which led to the demise of a company.
October 1, 2013 - In Q3 2013, there were 107 venture backed M&A transactions with $4.9B in disclosed deal value. While up quarter on quarter, number of transactions remains down 4% on a rolling four quarter basis and disclosed value is down 22% over the same time period. However, disclosed deal value is highly dependent on the mix of M&A deals disclosed and the number of deals disclosed is also down 6% on a rolling four quarter basis.