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Larry Cheng focuses on investment opportunities in Internet applications, information services and software. He prefers capital efficient businesses with $2M- $20M in subscript...
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Recent Posts
- Which Is More Important - The Stock Market or The Bond Market?
- Does God Answer Prayer?
- Why Growth Equity Is The Best Risk/Reward in Private Equity
- Who Is Scott Kirsner?
- Cortera - Crowdsourcing Business Credit Ratings
- Why Do Some Relationships Fail?
- The Tension Between An Optimistic CEO And A Conservative CFO
- Single Unit Value Is More Important Than Growth
- The Google Shift In Enterprise IT
- Just How Profitable are Healthcare Insurers?
- Why Are 80% of Harvard Students First-Borns?
- Independent Firms With Single Limited Partner Histories
- Volition Capital And Cue Ball Capital Lead Stylesight Financing
- Should Bernie Madoff Have Charged 1% or 2% Fees?
- Let The European Browser Wars Begin
- On The Blind Men And An Elephant
- The Magic Words
- Founder Liquidity
- The Single Playbook Executive - What Venture-Backed Executives Can Learn From...
- A Simulation Game: Cutting Your Losses
Archives
- August 2010 (1)
- May 2010 (1)
- April 2010 (1)
- March 2010 (12)
- January 2010 (2)
- December 2009 (1)
- November 2009 (4)
- October 2009 (2)
- September 2009 (2)
- 2009 (33)
By Category
- External (59)
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Posted: Wednesday 11 August 2010
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This topic was raised to me today in a meeting, and after thinking about it, doing some research, and trying to put aside my biased interest in stocks - I think a stronger case can be made that the bond market is more important than the stock market. There are a number of reasons for [...]
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Posted: Sunday 16 May 2010
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In response to the question presented in the title of this post, the following poem was read at my church service this morning - author unknown. I thought it was insightful, so decided to pass it along here: I asked God for strength, that I might achieve, I was made weak, that I might [...]
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Posted: Saturday 17 April 2010
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There are really three general asset classes in private equity: buyouts, growth equity, and venture capital. So why is growth equity the best risk/reward among the three in my estimation?
1. The downside protection of leveraged buyouts is exaggerated. The lure is that LBO firms are buying highly profitable companies with consistent cash flows, levering [...]
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Posted: Thursday 18 March 2010
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Today marks the first entry in a new series called "Who Is". This series will be about getting to know people in a slightly different light. My favorite part of the work we do at Volition Capital is getting to know people. So, I figured I take a little time each month and tell one [...]
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Posted: Tuesday 16 March 2010
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Congrats to Volition portfolio company, Cortera, which launched their new website yesterday. Cortera has a pretty simple mission in life - bring great financial and credit information on businesses to users at their fingertips for free or nearly free. Cortera also allows any business to rate any other business on how they pay their bills. [...]
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Posted: Saturday 13 March 2010
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I like to blog about different, random, more personal things on the weekends. Hence, I’m starting a series on books that I think directly or indirectly answer an interesting question with an interesting point of view. The first installment last weekend was Why Are 80% of Harvard Students First-Borns?. Today is the second installment and is [...]
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Posted: Friday 12 March 2010
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From what I can tell, in nearly every Volition portfolio company, the CEO is more optimistic than the CFO - and usually by a wide margin. Certainly, part of this structure is by design. But in reality, you just don’t find a lot of optimistic CFOs to hire, and a conservative CEO probably doesn’t inspire [...]
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Posted: Thursday 11 March 2010
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The pressure for revenue growth has hurt a lot of young companies. It starts with an entrepreneur representing a growth story to an investor. Then the investor represents the growth story to his firm to gain support for the investment. And then the investment happens. Then the company takes the investment, invests in sales and [...]
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Posted: Tuesday 9 March 2010
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Through our portfolio companies, we have a view into how Google is perceived for both large enterprise and small/medium enterprise computing needs. In some board meetings, I find myself exhorting management teams not to underestimate the impact of Google. In other board meetings, I find myself cautioning management teams not to overestimate Google. This dynamic [...]
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Posted: Monday 8 March 2010
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After reading this blog post on healthcare and hearing the rising volume against healthcare insurers - I wanted to understand more clearly the profitability of healthcare insurers. So, I went to Google Finance, searched for Aetna, got a list of their competitors - and researched their net profit margins. Here they are:
2009 Net Profit Margin of Healthcare [...]
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Posted: Saturday 6 March 2010
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That’s my estimate anyways. I remember it like it was yesterday. It was my freshman year at Harvard, and I was going to the first lecture of "Justice" - one of the most popular classes on campus. The lectures took place in Sanders Theater packed by over a thousand students since it’s only offered once [...]
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Posted: Friday 5 March 2010
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A breakfast conversation with Fred Wilson this morning prompted the thought of how many independent venture firms come directly or indirectly from firms that had a single or captive limited partner structure (one source of capital). Just thinking out loud:
Union Square Ventures was formed by Fred Wilson and Brad Burnham. Fred came from Flatiron which at the [...]
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Posted: Thursday 4 March 2010
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We are very pleased to partner with Cue Ball Capital on a $10 million investment in Stylesight which was announced yesterday. Stylesight is the leading style information service and SAAS platform for the global design ecosystem. Thousands of retailers, brands and manufacturers are using the subscription service to be inspired by real-time design images from around [...]
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Posted: Wednesday 3 March 2010
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The short answer is it depends. Here we go…
On a flight back from London today, my partner showed me a little blurb in the most recent Time Magazine about a bet between two scientists. They bet $300 on whether the first person to live 150 years would be born by 2000. They put the money [...]
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Posted: Monday 1 March 2010
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Starting this week, about 190 million Windows PC users in the EU will be offered the chance to change browsers as part of the Microsoft settlement. The process should take about 3 months. The browsers being offered were selected based on market share in the EU. Here are the 12 browsers being offered:
Avant
Flock
Google Chrome
GreenBrowser
K-Meleon
Maxthon
Mozilla [...]
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Posted: Saturday 23 January 2010
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Perhaps my favorite online video series is the Authors @ Google series where they bring the best and the brightest to Google to talk about their area of expertise. Tonight I was watching the video of Tim Keller (below), founding pastor of Redeemer Presbyterian Church in Manhattan. He was speaking at Google about his book - [...]
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Posted: Tuesday 5 January 2010
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I heard the magic words yesterday from a couple of my portfolio company executives that just warms my heart as an investor and board member. Those magic words are: "I want to invest in the company." In a prior post, Founder Liquidity, I wrote about how founders/executives not selling shares when they have the opportunity is [...]
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Posted: Tuesday 15 December 2009
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The sentiment towards founder liquidity among investors seems to swing back and forth like a pendulum. Founder liquidity refers to instances when an investor invests capital to buy shares directly from a founder rather than or in conjunction with investing capital that goes into the company for traditional working capital purposes. When capital goes to [...]
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Posted: Sunday 22 November 2009
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There used to be a single playbook in the NFL built around a simple philosophy - running and defense wins championships. The entire operating approach of teams was centered on this singular belief. The prototypical example of this was the 1986 Chicago Bears - think Buddy Ryan-coached defense with Mike Singletary and William "The Refrigerator" [...]
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Posted: Monday 16 November 2009
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One of my partners led an impromptu game in our team meeting today which illustrates the emotional tension of cutting your losses. For any investor or operator who takes risk with capital, the concept of cutting your losses comes into play at some point.
The simulated game started had these ground rules:
Everyone would have the chance [...]
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