Big drop in venture capital funding in Q1 2012

Venture capital funding in the first quarter 2012 really dropped. I was assuming this was because of a big decrease in later stage investing, but that’s not the case. In fact, later stage venture investing was up 11% in Q1.

peHUB has a very good guest post from a VC on the funding drop. Below is a chart showing the rise and the fall of venture fund investments in the US over the years.

The peHUB piece has a very interesting quote on seed investing:

  “End of the Great Seed Experiment” which is something I have been saying for the better part of a year – there was only $141MM invested in 53 deals in 1Q12 (admittedly I think that number is under-reported) as compared to $156MM and 90 deals in 4Q11 and strikingly to the $211MM and 86 deals in 1Q11. I have been on this thread for some time; that is, the VC industry is at risk of having created too many “me too” companies, and with less capital to invest across the board, many seed entrepreneurs will be deeply saddened when they come back to market for their Early round…

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Tablet TV overtakes laptop

Viacom research is suggesting that tablets are now the number 2 way to view a TV show – surpassing both laptops and smartphone usage as a TV show viewing device.

Here are the key findings, as quoted from the Viacom blog:

  • In just a few years, tablets have risen to second-screen prominence for full-length TV (FLTV) show viewing, ahead of computers. Yet, television still provides the better experience.
  • Tablets provide complementary experiences to TV viewing via second-screen experiences and co-viewing apps like MTV’s WatchWith.
  • MSO app users, Netflixers, Apple TV owners, AirPlay users and Whispersync users report higher levels of FLTV show watching on tablets. Over one-third of both AirPlay and Whispersync users say they watch more TV on their tablets because of these apps.
  • Tablet owners report emotional connections to this device unlike any other in the household – more than 50% of respondents said their tablet makes them feel happier and more relaxed, 49% said tablets make them more effective at managing life and 39% said tablets boost creativity. (end quote)

Tablets are pretty amazing devices. It’s pretty obvious that they are taking consumer mind share from laptops.

Check out Viacom’s blog post and press release.

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Interview on NPR

I’m interviewed on NPR this morning! Very cool stuff.

The piece was about startup real estate in Kendall Square, the leading innovation district in Boston.

I (Healy Jones) am interviewed by well known NPR reporter Curt Nickish about our quest to find new office space. OfficeDrop is growing, and we are striking deals with large companies, so we want to move into better digs.

The piece pokes a little fun at our dog-centric culture, and is a good listen to anyone who knows the Boston startup ecosystem.

Some of you may know my complaint that the VCs are moving into Kendall driving up the rent. The piece goes a bit deeper and talks about how big companies are gobbling up all the real estate. And driving up rent for little companies like us.

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SaaS growth still going strong according to Gartner

Gartner is predicting that Software as a Service will hit $14.5 billion in 2012. 17.9% growth off the previous year – not bad at all.

SaaS grow should stay robust until 2015 when Gartner says it will be $22.1 billion.

I happen to think it will stay strong beyond 2015, but I’m pretty sure that this just a limit of how far out Gartner wants to make a prediction at this time, not an actual limit of how long SaaS will continue to grow.

A quote from the release: “After more than a decade of use, adoption of SaaS continues to grow and evolve regionally within the enterprise application markets,” said Sharon Mertz, research director at Gartner. “Increasing familiarity with the SaaS model, continued oversight on IT budgets, the growth of platform as a service (PaaS) developer communities and interest in cloud computing are now driving adoption forward.”

Another cool thing about the Gartner press release is that it’s dated May 27, 2012 – they are really forward thinking over there! ;)

North America Leads SaaS Adoption

According to the release,  ”North America, specifically the U.S., currently represents the largest opportunity for SaaS, and it is the most mature of the regional markets. SaaS software revenue is forecast to total $9.1 billion in 2012, up from $7.8 billion in 2011. Consistent with other regions, North America shows the highest SaaS deployments in expense management, financials, email and office suites. Use of Web conferencing is higher in North America than in other regions, in part because of a highly distributed workforce.”

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