Power Pal

From my last post about search funds , I took a closer look at some of the documents on the Stanford CES website .  Specifically, I read through a 2007 study on the state of search funds.  It covered the stages search funds go through and typical characteristics at each stage - profiles of principals, typical fund and acquisition sizes, range of returns for the funds, etc. Some highlights from the four stages of search funds are as follows: Raising the search fund (3 months):  Write a formal proposal and business plan for the fund.  Sections of the plan include - executive summary, overview of process, list of screening criteria, detailed timeline and milestones, explanation of financing sought, outline of exit alternatives, backgrounds of principals and allocation of future responsibilities in the target.  Raising a fund typically takes around 3 months. Identifying and making the acquisition (20 months): The three steps in identifying an acquisition are 1) generating deal flow, scre...

The WSJ put out a three part video series on the source and events of the financial crisis.  It's about 25 minutes in length.  Good follow-ups to my previous posts - The Weekend that Wall Street Died and The End of Wall Street and Misaligned Incentives . Chapter 1: What Happened Chapter 2: Why it Happened Chapter 3: What Happens Next

I saw this post titled "How to Spot Subprime VC" from Georges van Hoegaerden on PEHUB and thought it was interesting.  Here are the highlights: Seems more interested in how it is built rather than what the disruptive business proposition is. Seems more worried about cost of development than cost of greenfield customer acquisition. Talks about valuations before you’ve explained the value of becoming the market leader. Seems more occupied with categorizing the investment than understanding its unique business value. Talks about capital efficiency without probing market inefficiency. Doesn’t question market entry risk, but focuses on cost . Doesn’t ask about the runway to profitability, but the initial round to get in. Asks you which other investors you’ve spoken to. Asks you to talk with his associates first. Asks you more about your education than your work experience.

I've heard the term cloud computing thrown around a lot and never quite knew what it was.  I quickly Google'd it.  I may be simplifying things, but it basically sounds like software (or hardware)-as-a-service.  Amazon's Web Services ( AWS ) is likely the leader in this category.  It seems like a natural evolution in computing - just a further packaging and abstraction of computing power.  I think what's important about it, though, is that from a strategic perspective, IT will become less and less of a differentiator among companies.  In the long-run, if everyone can quickly integrate and bring applications from a salesforce.com or AWS online in their business quickly, IT in and of itself will become more commoditized as an input in the value chain.  Or maybe it will kick-off another round of IT innovation that could serve as a differentiator.