The Venture Capital Cycle : Second Edition

Rating:
Summary: A Solid Effort!
Review: The Venture Capital Cycle is a thorough overview of the venture capital market that will be edifying to those who know little about the mysterious methods of private equity financiers, but self-evident to those with a background in corporate finance. Readers who have worked in or studied finance already are familiar with the tidal cycles that govern the flow of capital into early-stage companies, as well as the process through which money moves from institutions and individuals to fledgling enterprises. But we [...] strongly recommend that entrepreneurs read this book, which provides an exhaustive tour that will answer many - if not all - of your questions about where venture capital comes from, how you can get a hold of some, and how your life and business will change after you do. And if, along the way, you think that the authors sound too much like professors with their dense, academic prose, you're right.


Rating:
Summary: thorough but Not Practical
Review: Very important content, but of limited use for actual VC investors or entrepreneur. It is very good with its findings, but they are all known to investors, and are of less interest to entrepreneur. that being said, I enjoyed reading the book, which shows the "proofs" to many of the things we in the industry are doing almost intuitively. The books suffers from the fact it is not sufficiently detailed to be useful in practice, while at the same time is providing good information for students learning investments. I guess it is just addressing a different audience than myself, an entrepreneru and investor.

Rating:
Summary: Valuable and clear info for both sides of the vc process
Review: We used this book in an MBA course on Venture Capital here at the University of Michigan b-school. I think this is an excellent book.

First, do NOT expect to be a book full of venture capital anecdotes. While that is always intersting, this book is a serious treatment of what the venture capital business is about: how funds are raised, how venture capitalists arrange deals to ensure adequate compensation for their risk, how investments are staged, how the investments are managed, exit strategies and methods, and more.

This is a lot to cover in a book of approximately 350 pages, but it is all covered very well. The writing is quite clear and readable. Though this is not a book for the general reader, it is not difficult to read if you have some background understanding of business theory and a touch of finance.

What is so helpful about reading this book is that people seeking venture capital will understand more about why things are structured they way they are. It isn't just arbitrary greed and control. It is a business deal that requires an expected positive return - you know - making money (which does concern self-interest (greed) and structure (control) - but with slightly more reasoning).

While people seeking to make venture investments will immediately understand why they need something like this book and a whole lot more, I believe it is essential for people seeking investment money to also have a significant understanding of this process. Why? Because the venture capitalists understand this process completely and the people seeking investments usually don't do enough of these deals to really know what is going on. And if they are too blind they will be sheared like sheep. They need to understand all the interests involved so they can argue on their own behalf and make the deal as favorable as they can.

In any case, while this isn't the only book you should read on the subject it is certainly a good one. It is of manageable length with a great deal of clear and helpful information. I find this topic fascinating.