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The Antiportfolio

The Antiportfolio
by Paul McLellan on 07-29-2015 at 7:00 am

 Last week Charlie Cheng of Kilopass wrote about venture capital for semiconductor. This reminded me of something amusing that I came across years ago.

See also VC For Semiconductor: Dead or Alive?

All VCs have a portfolio page and often a second exit page. The first shows the companies in which they currently hold investments and the second is their boasting page where they list the companies that they either took public or sold and sometimes with some big numbers…especially if they were early investors in Cisco or Apple or eBay.

As far as I know, only one VC is brave enough to have an anti-portfolio page. These were companies who pitched to them, in which they never invested, and went on to be huge successes. Of course all venture capitalists have stories like that but usually it takes a couple of glasses of wine before they tell you them.

Bessemer have an interesting history. They are actually the oldest VC on the planet. You have probably heard of the Bessemer Converter that used to be used in steel making, invented by Englishman Sir Henry Bessemer. Yes, it is the same name for the same reason:In 1872, Henry Phipps, Jr. and Andrew Carnegie co-founded Carnegie Steel, an innovative steel producer that commercialized an industrial process licensed from Lord Henry Bessemer. When they sold their startup 29 years later, Henry formed a family office to re-invest his proceeds into other entrepreneurial ventures like his own. He adopted the Bessemer name to honor the inventor behind his startup’s success.


Bessemer have had some great exits over the years. They provided early funding for companies like Ingersoll Rand, WR Grace and International Paper, nobody’s idea of a startup these days. More recently they invested in and took public LinkedIn, Ciena, Maxim, Skype and more. But as they say, their:long and storied history has afforded our firm an unparalleled number of opportunities to completely screw up.

On their antiportfolio page they tell you about the ones that got away. Here are a few of the most notable:

  • Apple: Bessemer was offered a position in a pre-IPO stock at a $60M valuation. Neill Brownstein called it “outrageously expensive.” If they had taken that position and held it all the way until the present day that would have to be insanely great.
  • Ebay: “Stamps? Coins? Comic books? You’ve GOT to be kidding,” thought Cowan. “No-brainer pass.”
  • Facebook: Jeremy Levine spent a weekend at a corporate retreat in the summer of 2004 dodging persistent Harvard undergrad Eduardo Saverin’s rabid pitch. Finally, cornered in a lunch line, Jeremy delivered some sage advice “Kid, haven’t you heard of Friendster? Move on. It’s over!”
  • Intel: Pete Bancroft never quite settled on terms with Bob Noyce, who instead took venture financing from a guy named Arthur Rock.
  • FedEx: they passed…7 times

 And in the all-star miss, one of the partners, David Cowan had a college friend who had rented out her unused garage to a couple of students:In 1999 and 2000 she tried to introduce Cowan to “these two really smart Stanford students writing a search engine”. Students? A new search engine? In the most important moment ever for Bessemer’s anti-portfolio, Cowan asked her, “How can I get out of this house without going anywhere near your garage?”

The Bessemer Ventures Antiportfolio.

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