January 2016

small fed news

“…the Lockheed-Leidos deal indicates how massive contractors continue to fare well, while midsize IT companies continue to struggle.

“It’s a mature market, and mature markets award scale,” Aberman said. “[Lockheed and Leidos] can be profitable because they’re more efficient.”

While the current state of industry doesn’t bode well for midsized contractors, Aberman said the conditions have been right for startups.

“There’s an enormous advantage in the world of tech to be really, really large and benefit from scale, or be really, really small and be nimble,” he said. “You either win on scale or you win on uniqueness.”

Read entire article from Federal News Radio.

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The-Washington-Post-logo

The annual venture capital numbers are in. Venture-backed businesses saw almost $75 billion of investment in 2015, including corporate venture investing — the second-largest annual amount in this category. The bigger story, however, is how much the venture market will change this year.

Despite the record investment amount, the national market showed a significant slowdown in new investments in the fourth quarter. Investors are concerned about the state of the macro economy and the less-than-successful performance of a number of tech-related initial public offerings, and some wonder whether the growing number of venture-backed $1 billion “unicorns” will find their way to an exit for their investors.

While later-stage investment trends were adversely affected by broader market concerns, the early and seed stages enjoyed continued momentum. Nationally, seed and early-stage deal sizes increased and deals continued to occur at a solid pace.

The venture capital market now looks to me like a freight train derailment. The locomotive is off the tracks, and the end of train is still hurtling…

Read full column at WashingtonPost.com.

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small washpo

Media reports are currently full of dire predictions about the Chinese and world economies. I have read reports from otherwise credible financial industry insiders saying we should sell all our stocks, that oil prices will plummet to $10 a barrel and that the world economy will enter a deflationary spiral. Pretty scary stuff.

But, should we be scared? This is not the first time financial insiders have made extreme predictions. I remember being concerned in 2007 when the same characters predicted the Dow would go to 20,000 and oil would jump to $500 a barrel. And, being even more concerned a year later when predictions were made of a 4,000 Dow and a hyper inflationary debt spiral. Yet none of those things turned out to be true.

We tend to blame these market predictions on irrationality. However, I think the cause is…

Read the entire column at WashingtonPost.com.

 

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WBJ logo

The Washington region could hit the billion-dollar mark in cybersecurity venture funding in 2016.

Jonathan Aberman, managing director of Amplifier Ventures, a seed and early-stage venture capital fund based in McLean, said big fourth-quarter investments in cybersecurity companies helped boost overall venture funding in 2015 – and will continue to grow in 2016. He said the Washington region, a growing center for cybersecurity business and research overall, will see more big deals in 2016.

“I wouldn’t be surprised to see $500 million to $1 billion in cyber deals over the next 12 months,” Aberman said. “I just think…

Read the entire news story in the Washington Business Journal.

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small tbt

Earlier this week I had a chance to talk to a startup entrepreneur who had an interesting problem.  He felt that he had gotten so much advice about the process of starting a company and growing it that he was having a hard time parsing through it.  He was suffering as much as anything from having too much information, and was looking for me to help him filter it. As I thought about the irony of being asked to provide advice on which advice to take, something else more interesting hit me: he was suffering from a larger issue – the way that information is presented to first time entrepreneurs.

There is a tendency for information that is intended to help startup entrepreneurs to be reduced to a playbook or recipe.  Information is clustered around topics; for example, “when should you raise money,” “lean startup principles” or “hiring your first employee.”  Or, it is structured around the stage of a business – “how to start your company,” “how to raise a VC round” or “how to exit.”  This is further accentuated by…

Read entire blog from November 12, 2011.

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small washpo

Our region’s business community has a self-esteem problem. We nod shamefully when we are told we depend on government dollars for success.

Wrong.

We don’t need to “lessen our dependence on government” as much as we need to adapt our economy to what it will need going forward, and to take advantage of our proximity to the federal government to grow new businesses that benefit from this accessibility. The greater Washington region has long track record of producing large and lasting businesses off our regional strengths. Yes, we will always be a “government town” because federal dollars are a primary source of capital for entrepreneurial activity, both directly and indirectly. We shouldn’t run…

Read entire column at WashingtonPost.com.

 

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small tbt

I read this article this morning in the Atlantic.  It suggested the importance of a founder to a company’s success.  It analogizes the success of Steve Jobs and Apple, as a jumping off point for a stronger correlation.  The underlying argument is that founders worry about the company’s best interest, while “professional” CEOs worry about the interests of the financial investors.  This is not a new trope, and very much plays into worn out saw that VCs grab the company and steal it from the founder.  In my experience, this dynamic is much more nuanced and deserves a clearer approach.

The relationship between the founder and the investor (particularly the lead investor) goes a long way to defining the ultimate success of an investment and the company.  There is not much debate about that – the challenge is…

Read entire blog from September 3, 2011.

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small washpo

Last week, I shared my thoughts on trends I consider important for technology in 2016. This week: political and economic issues to look out for.

It just looks like Jerry Springer. This presidential election cycle will continue to amaze and delight — if your idea of entertainment is watching two political parties drive their constituencies into ever greater frenzy. Low-brow media and less-than-healthy political awareness have coalesced into a toxic brew where voters must be engaged at any cost and ratings must be won. “Engaging the base” used to mean getting a party’s strongest supporters to come out and vote, but this time around, “engaging base instincts“ is more descriptive. Look for this 2016 election to be more expensive and more polarizing than any before.

Don’t lose interest. The Federal Reserve will valiantly attempt to…

Read entire column on WashingtonPost.com.

 

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