Tuesday, August 25, 2009

Bill Coleman Joins 3tera Advisory Board

I think this move surprised a number of people, since Bill recently wrapped up Cassatt Corproation, getting the technology and people acquired by Computer Associates.

However, I was not surprised at all. The announcement, via 3tera Welcomes Bill Coleman:
You may or may not have seen the recent press realease.  Bill Coleman, IT/Silicon Valley luminary, Founder and CEO of BEA Systems, has joined 3Tera’s Advisory Board.

Yes, this alone is a great testimonial to what we have accomplished in our field.  Getting dignitaries such as Bill does not come easy.  But here’s the best part - this has a lot more than just marquee value and I doubt that Bill would have joined us if that was the case.  Bill, especially since his most recent stint as Founder and CEO of Cassatt Systems, is an extremely knowledgeable visionary in the area of utility and Cloud Computing; and, data center automation.

So, Bill will be extremely valuable, reviewing and tweaking both our business plans and technology as we forge ahead to maintain our lead at enabling Cloud Computing in enterprises and service providers.

Bill and I, both Founders of Cassatt, clearly share the same good taste in great technology. I've been following 3tera since 2005 and continue to be impressed with their accomplishments each year. I initially wrote about them on this blog back in 2006 in the article Amazon EC2 Killer Apps – Meet 3Tera.

I wish Bill and 3tera the best of luck as they move forward chipping away at the cloud. Bill will be an excellent addition to the 3tera Advisory Board (really, he should be on their Board of Directors, but nobody asked me...).

Friday, August 21, 2009

YACCI - Yet Another Cloud Computing Intro

From Liming Liu of www.cloudcomputingchina.com, check out: Cloud Computing Introduction. Nicely done, and is an indication of how fast this market is changing. Finally.

Friday, August 14, 2009

Databases in the Cloud

Ken North writes a great article in Dr. Dobb's Journal on Databases in the Cloud. Check out Dr. Dobb's | Databases in the Cloud: Elysian Fields or Briar Patch? | August 3, 2009:
The cloud is an elastic computing and data storage engine, a virtual network of servers, storage devices, and other computing resources. It's a major milestone in on-demand or utility computing, the evolutionary progeny of computer timesharing, high-performance networks and grid computing. The computer timesharing industry that emerged four decades ago pioneered the model for on-demand computing and pay-per-use resource sharing of storage and applications. More recently Ian Foster and Carl Kesselman advanced the concept of the grid to make large-scale computing networks accessible via a service model. Like computer timesharing and the grid, cloud computing often requires persistent storage so open source projects and commercial companies have responded with data store and database solutions.

The more things change, the more they stay the same...

Sunday, August 9, 2009

Doubling Down - Good Money After Bad

This post by Fred Wilson certainly resonated with me, and caused me to reflect about my time with Sevin Rosen Funds. Via Doubling Down:
Like most VCs, I am guilty of sticking with our investments too long and putting too much money into the ones that are not working. It's an occupational hazard. As I've gotten more experience in the venture business, I've gotten better at this part of the business, but it is still a challenge for me and most VCs I know.

Bliss McCrum, one of the two VCs who taught me the venture business early in my career always said, "if you are going to put more money into a company that is not working, make sure to change the strategy, team, or cost structure, or all three." It's good advice. You will not get a different result doing the same thing.

During my time at Sevin Rosen Funds, I saw quite a few presentations made by existing portfolio companies looking to raise a Series C or Series D round of investment. As the "new guy", I didn't have the history of what transpired to get the company to this point -- I was just evaluating the business as it stood at that moment.

More often than not, my advice was that the company was not a good candidate for follow-on investment. Invariably, the company did receive their follow-on investment.

It wasn't until I fully understood a number of things about VC that this all started to make sense to me: The way that VC funds are managed, how VCs are compensated, how money is allocated for follow-on rounds in the fund, the timing intricacies of when a new fund can be raised, the details hidden within LP agreements on how investments can be made when multiple funds are being managed by the VC entity, and the psychology that comes into play once your investment in a company is a public one (on the Portfolio page of your firm's web site) and you have become emotionally attached after a series of dozens or hundreds of board and strategy sessions.

Needless to say, my comments to SRF must have been heard as "your baby is ugly". And, let's face it, nobody wants to hear that their investment did not turn out to be a good one. With money allocated in a previous fund, and the LP agreement of the current fund prohibiting new investments in prior funds, say, some VCs may in fact be conditioned to double down more often than you would expect.

I completely agree with Fred Wilson and Bliss McCrum. Doubling down only makes sense when you change something core to the business. All too often, the VCs will do too little, or nothing at all, when doubling down. Such a strategy amounts to nothing more than hoping for some external change ("the market will finally start to take off; the hockey stick is just about to shoot up!") to make your investment pay off. That's bad business. That's throwing good money after bad. And the LPs will not like that.