« A Startup Bill Gates Would Love | Main | London Biz Angel Network Shows Seed Investing Pays »
April 23, 2006
Angel/Euro VC Relationship Still Uneasy
The relationship between VCs and business angels should be a natural one: the angels work with the founders to develop the business at a very early stage, and then bring in VCs to co-invest, add value at a strategic level, and manage the exit.
When the bubble burst, the partnerships between angels and VCs went bad, particularly when VCs exercised their shareholder in the inevitable down rounds that ensued. Seed stage backers got wiped out and are naturally wary of working with VCs now.
Several presentations from a recent European business angel network conference in Prague make it clear that there is still a way to go in rebuilding the relationships. This image illustrating the sentiment, for example, is from a presentation given by venture capitalist and Europe TechTour creator Sven Lignjaerde at the conference.
VCs are often seen as competitors, not partners. Their terms and conditions, although pretty much standardized these days even in Europe, are difficult to accept for angel investors. And VCs are perceived as having an "all or nothing" attitude.
Basically, there is a distrust and a "lack of win-win thinking," according to a presentation by Tomasz Czechowicz, who is a VC in Prague. He says that the onus is on the VCs to make their case and present the benefits to angels. And he apparently is not just paying lip service too, if his list of recent deals brought to him by angels active in central Europe is anything to go by.
Link - Presentation by Tomasz Czechowicz (powerpoint)
Link - Presentation by Sven Lingjaerde (powerpoint)
Posted on April 23, 2006 08:07 AM | Posted to News And Updates | Permalink
Trackback Pings
TrackBack URL for this entry:
http://www.thealarmclock.com/mt/mt-tb.cgi/955
