Mike Rogoway of The Oregonian writes
The NY Times reported over the weekend (reg. req’d) that Silicon Valley venture firm Sevin Rosen Funds is abandoning its Fund X and returning investors’ money. Per the NYTimes, the firm told investors:
“While good returns from any given firm’s portfolio is certainly a possibility, the statistics have clearly shifted in an unfavorable direction…The venture environment has changed so that overall returns for the entire industry are way too low and even the upper-quartile returns have dropped to insufficient levels.”
This article from EETimes notes that Sevin Rosen is a big player among wireless startups. The companies it has backed include Silicon Valley’s MetroFi, which is building Portland’s Wi-Fi network.
MetroFi has disclosed just $9 million in funding to date, but it will need a lot more than that to get its business off the ground. In addition to the Portland network (estimated to cost up to $10 million), MetroFi has built Wi-Fi projects in four Silicon Valley cities. It’s also planning networks in SoCal and Illinois.
With Sevin Rosen’s decision to scrap Fund X, MetroFi may have to write off one of its existing backers as a source for those future capital needs. At the least, Sevin Rosen’s move is a vote of no confidence in an emerging class of startups that includes MetroFi.
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