For many years now I have worked with Morgan Stanley and Goldman Sachs, probably the two best investment banks in the world. These two banks helped me financed my previous start ups. But for the two capital rounds of FON I did not work with them, nor with any other investment bank. FON raised a total of 28 million euros with a first round of 18 million and a second round of 10 million for, and we did it all ourselves. Investment Bank disintermediation in the case of FON is probably due to two reasons: one personal, one less so. On the personal front after having raised funds for Viatel, Jazztel, and other companies I created, it is easier for me to go out and raise funds on my own. But in general I think that investment banks left the start up scene in 2001 never to come back.

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Manuel on May 18, 2007  · 


I’ve been suffering this withdrawal from the start-up scene ever since I started raising capital for technology, soon after the dot-com crash (I admit to wrong timing).

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Gilles Amsallem on May 18, 2007  · 

Very true
As you said, you are super track recorded. Your investors are also very comfortable in your domain … Such fit between an entrepreneur a new venture and PE investors is very rare .
I see many investors who need support to decide an investment specially in High tech industry .
Raising funds for early stage technology company is now the job of a good investment boutique ( more than big investment banks ) .

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Jean-Michel on May 19, 2007  · 

Large investment banks are just not well equipped to work with startups – too high overheads.

CEOs with Martin’s kind of backgrounds probably don’t need advisers (although would you do an M&A without advisers? probably no: too much else to do, don’t want to have the hassle of project managing the process, always nice to have a fuse in between the principals etc).

But in the case of less experienced entepreneurs the case is even more compelling: many European entrepreneurs haven’t much experience of VCs, and even good entrepreneurs are mostly networked in their home country – but who says the best investor is in your home backyard?

As usual market adapts, and large i-banks are being replaced by a bunch of more specialised service providers of which Go4Ventue is one of the oldest (born 2000!). The key criterion here should be track record and ability to tap international investors (wherever they are) based on the value-add they can bring.

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Antoin O Lachtnain on May 21, 2007  · 

I can see why an i-bank would suit a capital intensive infrastructure roll-out project which can be measured and analysed against known models, as opposed to a web type project which is basically going into completely new ground.

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Max on May 21, 2007  · 

My bet is that as soon as we start seeing decent public market exits, they’ll be back more earnestly. Until then, why bother?

Also: there are specialist I-Banks doing phenomenally well, e.g. Long Acre.

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