Venture Capital Outlook 2011: Washington DC and beyond

Potomac Tech Wire hosted a breakfast panel on December 17, 2010 featuring high-profile venture capital personalities in the Mid-Atlantic region to discuss trends for 2011. The panelists were candid about what they're looking for when investing in companies and optimistic about VC activity in the Washington DC region in 2011. Here are the insights these panelists offered:

Harry Weller, general partner at NEA:

  • The team and the size of the market are his top criteria in deciding what companies to fund.
  • They invest aggressively when they find situations with cheap customer acquisition costs.
  • They invested in Groupon based largely on the quality of the founder, rather than the original idea.
  • A strategy for international expansion is more important early on than it has been in the past.
  • Sweat and equity and reputation attract venture capital.

Don Rainey, general partner at Grotech Ventures:

  • Wants to fund products that are basically done. Investors want to go from initial funding to market within around 90 days, noting that 6-9 months is considered a very long horizon.

Thanasis Delistathis, founder and managing partner of New Atlantic Ventures:

  • Timing market trends is key for entrepreneurs developing their product and positioning a product in front of customers. As an investor, they want to know the market is ready for the product.
  • Measurable results are very valuable. Delistathis cited Groupon's measurable value proposition to businesses as a good example of a compelling and measurable metric.

Finally, Harry Weller announced that he wants to start a Last Thursday coffee that would be open to any and all entrepreneurs who want to meet up in an informal setting to exchange ideas and information. The model seems to come from successful “Open Coffee” meetings such as the Seattle Open Coffee Club run by Andy Sack. Details are not yet available, but we will post them when they are.