Alchemy Semiconductor, Inc., Press Room - In The News -
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Published on: 1/3/2001
Last Visited: 8/7/2001
I think the bar for getting funded this year will be higher than it's been for a couple of years , said Stephen Straus , general partner at Austin Ventures , an Austin , Texas-based venture capital ( VC ) company.[ Venture ] firms have to go back to doing due diligence about startups and being more informed.That's a discipline that got lost in the Internet [ and ] e-commerce hype..
Economic downturns cause VCs to tread more warily , noted Fu , who said he expects caution to be the watchword for investment in 2001.
And that's not necessarily a bad thing , said Straus , who proclaims himself happy that stock valuations are going back to normal , historical levels.
U.S. Venture Partners has invested in early stage semiconductor companies for 20 years.The firm provided part of the first round of funding for Alchemy Semiconductor Inc. ( Austin ) last year and recently earmarked funds for three as-yet-unnamed companies in the communications-IC industry for 2001.
Austin Ventures also contributed to the initial $15 million funding round for Alchemy in April 2000.
Although the general economic outlook is uncertain , said Fu , U.S. Venture Partners will continue to fund companies this year with money from a $1 billion fund it recently closed.
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We invest for the long term - five or six years out - and we don't know what the macroeconomy will be like by that time , said Straus.If the startup has a good engineering team in place , customers find the product intriguing and the company has an innovative technology that can be differentiated in the marketplace , we have every confidence [ in the company ] and believe it's a worthwhile investment , no matter the economic climate..
What was it about Alchemy that caught the attention of both Austin Ventures and U.S. Venture Partners.
According to Fu , it was the engineering team , which includes designers who worked on Digital Equipment Corp.'s Alpha and StrongARM chips and the Motorola Power PC.[ With that kind of experience ] we had no doubt they'll execute on whatever they set out to do , he said.