Bebo founder working on a “little social network”

– Connie Loizos is a contributor for PE Hub, a Thomson Reuters publication. This article originally appeared here. –

“I don’t think Facebook has peaked,” said Michael Birch, absently piling his trademark curtain of brown hair atop his head. “The point of saturation is often a lot further out” than many people assume, he added. “But what goes up must come down.”

We are sitting in his San Francisco offices and Birch, best known for selling his three-year-old social networking startup Bebo to America Online for a stunning $850 million in cash, is sharing some thoughts about the current crop of social networking darlings — and whether we’re in a bubble.

Birch has certainly had time to form some opinions. Months after Bebo’s 2008 sale, he found himself on the operating table, undergoing open-heart surgery for a leaky heart valve. The experience rattled Birch and afterward, he committed to permanently change his work-life balance, sticking mostly to angel investing to maintain his ties and perspective. He has since helped to seed fund 30 startups, including Mixpanel in San Francisco and London-based Onalytica, both of which offer their customers analytics tools to improve their market research.

Still, Birch tells me he “ducked out” out of angel investing at the end of last year. “I do think there’s a bit of a bubble – though I don’t like that word.” Soaring valuations simply made investing in very early-stage startups “a bit pointless,” he says.

Pre-money valuations rose in 2010: report

– Mark Boslet is a contributor to PE Hub, a Thomson Reuters publication. This article originally appeared here. –

Deal terms and valuations shifted in favor of entrepreneurs last year as onerous term sheets became less common and money flowed more freely.

These were the findings of a study by the law firm Cooley released this week. (The data comes from transactions in which Cooley served as counsel).

Figuring out Foursquare

– Jeff Bussgang is a general partner at Flybridge Capital Partners and an Entrepreneur-in-Residence at Harvard Business School. He is the author of “Mastering the VC Game”. This article originally appeared on his blog www.seeingbothsides.com. The views expressed are his own. –

I had the pleasure of teaching a new case at Harvard Business School recently on Foursquare that I co-authored with professors Tom Eisenmann and Mikolaj Piskorski as part of Tom’s new course “Launching Technology Ventures“.

Foursquare executives Dennis Crowley, Naveen Selvadurai and Evan Cohen were kind enough to allow us to interview them in preparation for the case, which framed some of their current key strategic issues and looked back on the choices they made in the early days to draw pedagogical lessons of lean startup best practices, building a platform business, network effects and running monetization experiments.