Interesting article around growing appetite from US VC firms in late stage companies, at valuations that seem rocket high, but who knows! The dynamics of the shift are interesting – from some firms that missed the early bus, to others that are building a strategy around mixed stage investments.
Will Indian ecommerce segment see a similar chart, especially as companies succeed to create value and need bigger and bigger cheques?
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The writing on the wall is clear as far as India is concerned. No early stage bets going by the past experience of few if not no-winners. In the investment game, experience wins hands down over youth, any day.
So what if VC firms identify more with Hedge Funds in going for multi-million dollar late stage deals…? That’s far better than taking a Mr.Wise-ass posture and help the firm go belly up after quite a few series A exposures taking the investors along with it. I think every investor that invests in the VC asset class will certainly approve of this transition to make huge trades in well-baked companies without any board obligations – if that ensures returns, so be it. Not before long, overcrowding the in the late stage space will drive the firms to evolve faster further to find fortune in secondary stock markets post listing, going by the track record of recent IPOs that lagged… To hell with tax breaks, it’s valuations and exit premium that matters…
Happy realization…!!!