Venture capitalists seem to fall into two buckets when it comes to Web 2.0. They are either in love with consumer facing Internet startup using Web 2.0 technologies or they hate them. There are few shades of grey. Place Gilman Louie in the latter category.
The former head of In-Q-Tel who co-founded Alsop Louie Partners last year with NEA-vet Stewart Alsop, explained his view of Web 2.0 startups in a recent blog post.
We see a lot of Web 2.0 pitches from young entrepreneurs. The basic pitch: for an investment of $2 to $5 million, they can build a company that Google, Yahoo or Microsoft will buy. And, in under two years, we can get 5-10 times our money back. How could you not like that?!
We don’t. We always decline to participate in deals like that. We think this is a kind of disease, often caught by these youngsters in business school. They are looking to cash in on Web 2.0 fever and flip their companies quickly for a nice tidy sum.
He doesn't mask his disinterest in backing entrepreneurs launching what he believes are features for larger companies. His vehemence against most of this sector would suggest the firm is seeking out investment partners focused on harder technologies. While that may well be the case, for link love, Alsop Louie's web site is definitely focused on blogs written by Web 2.0 heavy VCs. Perhaps that can be chalked up to personal, not professional, kinship.
Whatever the case, if you've ever wondered why so many venture capitalists are sitting on the sidelines of Web 2.0 dealmaking, Louie's post is for you.
Tags: web20, gilbert+louie, vc, venture+capital, ipo
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