At the GeekWire Meetup earlier this week, I bumped into Seattle venture capitalist Enrique Godreau. I didn’t get a chance to ask in any great detail what he’s been up to following his departure from Voyager Capital, the Seattle venture firm that he co-founded 15 years ago. But perhaps I should have asked more direct questions.
Xconomy’s Curt Woodward reports that Godreau has landed at a new venture firm by the name of GSharp Ventures, working alongside former Microsoft and Yahoo executive Luis Salazar as well as Tom Nault and Kim Nelson.
Also involved is former Microsoft executive and AOL Chief Technology Officer Alex Gounares, who Woodward says is CEO of a new cloud computing startup called Concurix. Former GoAhead Software CEO John Hansen is listed as an operating adviser to GSharp.
The firm’s Twitter handle suggests a joint location in Seattle and Menlo Park, an approach similar to Voyager which was one of the first venture firms to have a presence in both tech hubs.
Godreau isn’t saying too much about the new firm at this point.
“We are excited about what we are doing and believe that you and your readers will be as well,” Godreau told GeekWire. “We look forward to sharing more details at an appropriate time, but regret that right now we have no comment.”
Typically, new venture firms are especially quiet as they move through the fundraising process, and that may be why Godreau is being tight-lipped at the moment. (Interestingly, Voyager Capital also is on the market for a new fund, looking to raise up to $125 million).
Nonetheless, despite Godreau’s secretiveness about GSharp, the firm’s bare-bones Web site offers a few clues, indicating that it is interested in “the smart cloud: the profitable web 3.0; education technologies; consumerization of the enterprise.” The site also says that GSharp is about “back to basics venture capital, anchored in operational excellence.”
That message dovetails with what Godreau had to say after departing Voyager.
Over the last 15 years, we have seen and experienced a lot of change in the business of start-up formation and all aspects of the information technology industry—open source, the smartphone, the cloud, social networks, ubiquitous digital networks, etc.
Yet it seems odd to me that in spite of these seismic changes, that the world of venture hasn’t really adapted or changed very much. In terms of my next steps, I am going to take some time to revisit the roots of venture capital, reflect on my personal experiences as a VC, and play with the question: “What would I do different?”
It appears that Godreau has at least found the starting point to that answer in GSharp.
And they’ve laid out their case in a manifesto on the GSharp Web site, writing that they are hoping to form a new type of firm that’s a bit “retro” in its approach.
A global renaissance in tech entrepreneurship is underway. Many factors are contributing to this transformation, but the principal reason is that product development costs are at all-time lows. This is enabled by cloud computing, a mature digital infrastructure, ready access to first class outsourced development talent, and a ubiquitous mobile ecosystem growing 3X faster than the desktop internet.
The sum of these and other factors creates an opportunity for a new type of investment fund to complement the important role of Angel investors, Micro VC’s, and start-up incubators that have emerged to fill a void in the market providing capital as well as industry experience and relationships at the ideation phase in the development of a company.
To maximize the potential of this new paradigm in tech entrepreneurship we have identified a new approach to investing we are calling Venture Equity (VE). VE combines the concepts of venture capital and private equity. Like Venture Capital, a Venture Equity firm invests in emerging businesses seeking a non-controlling equity interest. And like Private Equity, provide, at no cost to entrepreneurs, access to experienced operators to maximize and unlock asset value while also minimizing overall risk.
Venture Equity firms fill a need in a continuum, helping entrepreneurs at the go-to-market Formation stage, which comes after the Angel/Incubator/Micro VC investing rounds or “Ideation” stage, but before the “Scaling”, or high growth phase served by larger VC’s, Private Equity firms or corporate acquirers.
VE firms are retro. They are “back to basics” investment entities, leveraging proven track records in Venture and Corporate investing and staffed by a team of successful Innovators, Operators, and Executive Managers who work side by side with entrepreneurs to build winning and lasting companies.