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January 18, 2007
Europe's Tower Of Babelgum
Last year we were putting up posts pitting a European market-leader-wannabe versus a US wannabe, this year it's rivalling European startups, the latest being Babelgum versus Joost [via Nice Ventures and The Equity Kicker blogs], two early entrants aiming to offer P2P TV.
It brings to mind the observations of Danny Rimer of Index Ventures voiced at LeWeb3 a few weeks ago where he said that he sees a "danger" in Euro VCs funding too many startups all chasing the same opportunity. See Vpod.tv's excellent video of the VC panel via myblog link below.
Bascially Rimer was saying that it is worrisome enough that they are funding several competing ventures that want to be the European market leader in a particular application, but if they want to decent exits, it is especially foolhardy to back startups competing in the same country. (Rather than referring to the tower of Babylon and subsequent rivallries in the headline, maybe we should have referred to the medieval towers of Bologne and what they signified.)
It might be an issue for some VCs (depending on the size of their funds) -- and may signfiy some deterioration in the clubby nature of European dealmaking that we've been seeing in recent years -- but it is not stopping experienced founders with track records in their sectors from starting up new companies where they see opportunities.
Two of several areas that are proving to be magnets for serial entreprenurs are:
1) discounting the mobile network operator, e.g. FON, Rebtel, Jajah, and Truphone
2) delivering TV and video content over IP e.g. Joost/Venice Project, VideoJug, Kewego, TVBlob, and Babelgum.
Read - Broadband Television Not As Big As I Though (the equity kicker)
Read - Babelgum To Follow Long Tail Theory (niceventures blog)
Link LeWeb3 VC panel video (Ouriel myblog) Danny Rimer's comments are located at timestamp 12:29 and 18:44
Posted on January 18, 2007 12:50 PM | Posted to Venture Capital | Permalink
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