Tech trends and business ideas

All things that motivate entrepreneurs

Tuesday, November 20, 2007

Worst VC investments of all time

You pitch your business plan to a VC and he bites in. Funnels millions of $$ into your business and hopes to exit with some tidy profit. When it goes well as planned, oh, great. What if it doesn’t and the investment backfires?

Some things were just never meant to be, but that doesn't mean that investors won't pile millions of dollars upon a bad idea — or even a good idea gone bad. Whether they crashed and burned or sucked investors dry, these ventures just didn't work out. Check out our graveyard of dreams and money to get a look at VC (venture-capital) investments that just weren't wise.

Here’s a list of startup flameouts. [Good friend Matt Marshall piled up the quick list ]

Amp’d Mobile: $360 million, ended in bankruptcy.
Procket: $272 million, sold for $89 million.
Webvan: Valued at $1.2 billion, went bankrupt in 2001. Ate through $800 million in venture capital, ended with $830 million in losses.
Caspian Networks: >$300 million in funding, closed doors. $50 million by Hummer Winblad Venture Partners, Bowman Capital, and Inc., did sock-puppet ads, then crashed.
Optiva: $41.5 million in venture capital, crashed. $250 million in investment, liquidated.
CueCat: $185 million from investors like The Coca-Cola Co. and General Electric Co., bombed.
DeNovis Inc.: $125 million in venture capital, closed.
PointCast Inc.: Tens of millions of dollars in venture capital and a $400 million buy offer, PointCast was sold for $7 million.
eToys: Backed by VC firms Idealab, Highland Capital Partners LLC and Sequoia Capital Partners, ended in bankruptcy.
AllAdvantage: $135 million in venture capital down the drain.
FastForward: $54 million into the company, bankrupt.
Xoma: This 26-year old company has not earned a profit since its inception in 1981. $50 million, went broke.
Vanguarde Media Inc.: $60 million in VC funding, went under. $16 million not remarkable, but burned through with remarkable style.
Bolt Media Inc.: >$60 million in venture backing, shut down.
DigiScents: $20 million in investment, shut down. $120 million, went bust.



Blogger Curious MInd said...

very interesting stats....i wish media take some hint from them before they add hype factor to a venture geting VC money....and entreprenuers must understand that getting money is not the "goal" but creating a cutomer and develoeping s sustainable business is.

10:49 PM  

Post a Comment

Subscribe to Post Comments [Atom]

<< Home