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13

Jan

2014

Innovation Economy Outlook Survey PDF Print E-mail

Janice Mawson

Written by Janice Mawson   
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Each year, long-time NVCA partner SVB surveys executives at high-growth companies to collect insights about innovative companies around the world. Named the Innovation Economy Outlook survey (formerly Startup Outlook), the study aims to assess the health of various tech sectors and public policy factors affecting venture investing.

In past years, the survey focused on technology, life sciences and cleantech companies in the U.S. and UK that have up to $100 million in annual revenues. This year, SVB is extending the survey to established companies and to more geographies.

NVCA is asking members to encourage management at their portfolio companies to take the SVB Innovation Economy Outlook survey before January 24. Participants will have the opportunity to request the results of the study, which could provide valuable intelligence regarding their companies’ performance relative to peers and regarding future outlooks for their industries.

 

09

Jan

2014

Strong year for Biotech IPOs Spurs Optimism for 2014 PDF Print E-mail

Kelly Sloane

Written by Kelly Slone   
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As the flood of 2013 recaps and 2014 predictions begins to recede, one storyline continues to spur optimism among venture capitalists: the continued improvement in the venture-backed IPO market. In no sector was this trend more notable than in biotechnology.  With 42 IPOs, biotech provided nearly half of the venture-backed total in 2013. In fact, 2013 saw more biotech IPOs than the last five years combined.

Many factors impact the exit environment for venture-backed companies in a given year. But we believe that two NVCA policy initiatives in 2012 helped pave the way for biotech’s resurgence in 2013. The first is the JOBS Act of 2012, which aimed to ease the cost and regulatory burdens faced by small, innovative startups looking to go public. This past year, the average biotech IPO raised $83 million, which is exactly the type of offering that the JOBS Act’s On-Ramp was designed to enable.

The second is the FDA Reform Act of 2012. NVCA and MedIC members worked tirelessly in support of that legislation because we believed that a demonstrable commitment to reform on the part of Congress and the FDA would help improve confidence and outlooks for participants across the entire life sciences continuum. For example, we believe that the upward trend in drug approvals over the past several years has increased investor confidence in the FDA's review and approval process.  We also believe that stronger fundamentals have attracted generalist investors back to the sector, which has increased both the available pool of capital and IPO company valuations.

All of these factors drove IPO market performance in 2013. And we are cautiously optimistic that their momentum will carry over into 2014.
 

20

Dec

2013

NVCA Sponsors Mobile Medical App Roadshow PDF Print E-mail

Kelly Sloane

Written by Kelly Slone   
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Since the day the U.S. Food & Drug Administration (FDA) published its final guidance on mobile medical apps last September, app developers have been trying to determine how the FDA guidance impacts their particular apps and business plans. Now, a consortium of six leading universities, more than a dozen industry trade associations and professional societies – including NVCA, and the FDA are poised to help developers do just that through a series of educational programs called “MMA Roadshow:  Managing App Development under FDA Regulation.”

Targeting entrepreneurs and innovators, the MMA Roadshow aims to demystify the FDA requirements, improve understanding of the process for innovating in this regulated space, and identify best practices among those companies already producing regulated apps. It will consist of six events distributed evenly between the East Coast, West Coast and Midwest and Southwest. (A complete schedule can be found here.)

Each four-hour program will include a mix of presentations and panel discussions featuring participants who are either involved in or who have successfully navigated the FDA process for obtaining clearance from the agency to market their app. They will share what they have learned from a regulatory strategy perspective, as well as what they have encountered from a business perspective. Officials from the FDA will participate actively in the program, both helping to explain its requirements and fielding difficult questions.

The consortium has designed the MMA Roadshow to accomplish the larger goal of advancing patient care by encouraging the development of apps at the higher benefit/higher risk end of the spectrum – where the opportunities to improve patient outcomes and spur economic development are the greatest.

For more information about the MMA Roadshow Consortium, or to register, you can go to www.mHealthregulatorycoalition.com/events.  As a member/sponsor, NVCA can offer its members a 50 percent discount on registration. To obtain the discount code, please contact Lisa Blackburn at lblackburn@ebglaw.com.
Last Updated on Friday, 20 December 2013 12:48
 

17

Dec

2013

Hannah Veith Joins NVCA as Director of Business Development PDF Print E-mail

Janice Mawson

Written by Janice Mawson   
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The National Venture Capital Association is pleased to announce that Hannah Veith has joined the association as its director of business development. Hannah is responsible for cultivating relationships with business partners and growing non-dues revenue for the association. Her duties include managing NVCA’s preferred provider listing, as well as sponsorship opportunities for the association’s website, member directory, monthly newsletter and special events – including VentureScape, the NVCA’s annual meeting.

Prior to joining NVCA, Hannah worked at CTIA – The Wireless Association. There, she served as the liaison for marketing, public relations and partnerships for CTIA events and conventions. She began her career in CTIA’s Regulatory Affairs Department, where she was a member of the association’s regulatory policy advocacy team.

Hannah received her BSBA cum laude in management and marketing from Robert Morris University, where she played for the university's Division I volleyball team. 

You can reach Hannah at hveith@nvca.org or at 703-778-9289.

Last Updated on Tuesday, 17 December 2013 15:14
 

16

Dec

2013

In Tech Bubble Talk, Differences Outweigh Similarities with Early 2000s PDF Print E-mail

Bobby Franklin

Written by Bobby Franklin   
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In the wake of last month’s Twitter IPO, and the attention it drew to the valuations of those companies widely perceived as “next in line,” some of our members have reported fielding questions from journalists and other market observers about whether we’re seeing the beginnings of another tech bubble. Based on my conversations with these folks, the short answer is, “No.”

First, any vigorous market that features serial highs like those we’ve seen in recent months is going to attract investor attention. That, in turn, breeds higher valuations.  That said, we believe that these companies are creating and delivering real lasting value to their end users. So, while some froth may be present, it’s not fanned by hot air alone.

Second, the companies presently garnering the most attention are much further along in their development curves than the “cautionary tale” companies of the early 2000s. Far beyond the proof-of-concept stage, many of today’s tech leaders are sustainable, scalable businesses that have already built daily relationships with tens of millions – or even hundreds of millions– of users.

Third, higher valuations are somewhat part and parcel of the longer runways to exit we’ve seen since the tech bubble, and through the Great Recession. The longer a promising venture-backed company remains private and independent, the more guidance and funding it may receive from its investors – and the more it may be apt to grow. Similarly, the longer a VC firm can keep a successful company in its portfolio, the greater the value it can return to its investors – the limited partners – at the exit. This is not to say that VCs are enjoying today’s longer runways, but they are capturing more of the upside where possible.

Finally, many VCs believe that now is still a good time to invest. In each of the last five years, the industry has invested more money than it has raised. Yes, fundraising has been difficult, but the investing climate still looks good to many. Otherwise, so many VCs would not be investing ahead of their fundraising.

Yes, those who ignore the lessons of history are still doomed to repeat them. But insight lives in both the similarities and differences between yesterday and today, and we should take care to consider both in this case.

 

25

Nov

2013

Patent Litigation Reform Advances in Congress PDF Print E-mail

Kelly Sloane

Written by Kelly Slone   
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Patent litigation reform has gained significant momentum in Washington over the past month, with bills being unveiled in both houses of Congress and the White House reiterating its desire to see a measure reach the President’s desk. In more colloquial terms, Congress is once again attempting to tackle the problem of patent trolls.  While we agree with those who want to curb abusive litigation, we also recognize that the potential impacts of some of the reform proposals do not cut neatly across the traditional venture sectors in which our members invest.

For a significant number of NVCA members, abusive patent assertions and litigation have become a serious concern, as indicated in a recent study by UC Hastings law professor Robin Feldman, with participation from NVCA members and portfolio companies. This is likely because the costs of challenging or infringing upon the patents of innovative upstarts are relatively low, while the benefits can be high. Conversely, the costs and burdens of defending against infringement or assertions for those small venture-backed companies are often disproportionately high. These dynamics have made abusive and frivolous assertions and infringements popular strategies, and they must be addressed.

However, the need to address these concerns must be balanced with the needs of those start-ups that depend on strong patent protection and that believe the system is working. In addition, any remedial actions must also guard against unintended consequences that could weaken strong patent protection.

Within this context, NVCA is working with Members of Congress, as well as those in our industry, to find a consensus around appropriate solutions as discussions about patent litigation continue in both chambers. In the House, the Judiciary Committee marked up the Innovation Act of 2013 (H.R. 3309) on Nov. 20 and voted 33-5 to advance the amended bill to the House floor. Introduced by Chairman Bob Goodlatte (R-Va.), the Innovation Act aims to curb the practice of abusive and/or frivolous patent assertions by bringing more transparency to the process and easing the burdens on defenders in such cases. While NVCA supports the bill’s broader goals of limiting abuse of patent protections and ensuring that the U.S. patent system works efficiently to encourage and reward innovation, the Innovation Act of 2013 contains a number of provisions that warrant concern for venture capitalists. NVCA expressed these concerns on record in a letter to the committee prior to the markup session.

In the opposite chamber, Senate Judiciary Chairman Patrick Leahy (D-Vt.) and Sen. Mike Lee (R-Utah) have introduced the Patent Transparency and Improvements Act. This bill focuses more directly on the issue of frivolous demand letters by confirming the Federal Trade Commission’s authority to act against companies that threaten to file infringement lawsuits for which the primary goal is securing settlements from their targets. The bill does not currently contain language regarding fee shifting. An outline of the bill can be found here.

While the House appears ready to bring H.R. 3309 up for a full vote sometime next week, we believe that progress may come more slowly in the Senate, and thus temper some of the momentum we’re seeing now. In any event, NVCA is confident that we will have additional opportunities to deliver our messages on these issues – and in the process, assist lawmakers in passing legislation that strikes the right balance for all stakeholders.

Last Updated on Monday, 25 November 2013 14:27
 
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