September - 2001 - issue > VC Talk

Several factors play interesting and interacting roles in making a business successful. Speed, time to market, profitability, market share, and experienced management are commonly discussed in the context of new and successful companies. Speed and time to market were always important — even before 1995, in fact even before 1895. These are important factors today also and will be important in 2099. The important question that most people forgot to ask in the last few years is, What is the market for the product or service and what is the business model to make it popular? These are the questions that people are asking now. Profitability is the result of a solid product and a sensible business model.

Real revolutionaries know and focus on the goal of revolution. The trouble is that many bystanders jump on the bandwagon and start thinking, and more dangerously start claiming, that they are revolutionaries. They don’t realize that the speed to bring a correct product is important, not just the speed. If you don’t have a well-thought-out product, you can bring that to market super quickly, and fail soon. The only good thing is that the agony of failure does not last too long, because the speed is fast.
A 100-meter Olympic champion sprinter has to run at a specific place and at a specific time. If you run faster than that at a random place and at a random time, you are not going to win the race. Also, remember that the fastest runners are not necessarily successful in football, soccer, or basketball.

The rules have not changed; emphasis on different factors has and does keep changing.

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VENTURE ACTIVITIES
Kirusa
(Berkeley Heights, New Jersey)
>Infrastructure developer of multi-modal applications
>$3 million
>Innovacom and Louis Golm

Internet Machines
(Fremont, Calif.)
>$41 million in Series C round
>Exar Corp. and Banc of America Securities.

Trebia Networks
(Acton, Mass.)
>Developer of network processors for storage network applications
>$30 million in Series B
>Atlas Venture, BankBoston Ventures, Kodiak Venture, Raza Foundries, Deutsche Banc Alex Brown and Allianz of America

BayPackets
(Fremont, Calif.)
>Accelerated network-based voice service implementation and OSS/BSS integration software provider
>$19.5 million in Series B
>Lucent Venture Partners, Antillion Capital II, Blueprint Ventures, Diamondhead Ventures, INC3 Ventures Series I, Mentmore Ventures, and TeleSoft Partners.