This is from Claire Cain Miller in Sunday’s New York Times, a story called A New Kind of Venture Capitalist Makes Small Bets on Young Firms. Fred Wilson, New York venture capitalist known for his popular A VC blog, gets a rave review:
Union Square Ventures has built its portfolio making small bets on young companies.
“We say, ‘Let’s go on this ride together,’ and if we do get great traction, we’ll try to invest in a second round as well,” said Brad Burnham, who co-founded the firm with [Fred] Wilson.
As [Rob] Kalin [an entrepreneur whose story starts the piece] soon discovered, the small initial stake was not the only thing that distinguished Union Square from its competitors. Grounded in a philosophy of discipline and openness, the three-partner firm focuses on services that use the Web to change a market rather than simply make it more efficient.
Interesting story. What’s different here (well, among other things) is the idea of calling it venture capital when it’s taking smaller shares of newer companies with less investment in each. It’s credible, though, because it fits with the general profile of Web 2.0 companies taking less from start to validation, which I’ve discussed from time to time on this blog.
You might also enjoy the back story, on Fred Wilson’s blog.
I’ve been a reader for a couple years now. Fred Wilson gets quoted frequently in the media, and usually he makes a lot of sense.
Let’s hope the media attention doesn’t spoil it. We want him to be a role model, not a window that’s going to close from too much attention.
Tim Berry is the founder and chairman of Palo Alto Software and Bplans.com. Follow him on Twitter @Timberry.
