A Bed Time Story Venture Capitalists Tell Their Children
January 15th, 2012Once upon a time, back in the days of yore, when entrepreneurs went by names like “Jeff Bezos”, Internet retailers were the investment rage, and Harvard still printed a face book of its students on paper, there was a ritual that many venture capital backed participated in. It was called the “initial public offering.”
Now, many of you are young and can’t remember the 1990s, so let me tell you about this ritual. The founders of companies would sell shares of those businesses to the public and the businesses would be listed on the stock exchange.
This ritual, my children, is rarely used anymore. Like other ancient tools like the typewriter and the phonograph, the IPO-as-exit-vehicle has been replaced by a more modern tool: the acquisition.
recently released its counts of the number of venture capital-backed companies that exited in 2011, and the numbers tell the story of the lost IPO-as-exit-vehicle. The data
Tags: Time, Time Story