Investing in Publicly Traded Venture Capital Firms

If you think plunking down $98,192 for ten months of education sounds a bit extreme, you’re not alone. Yet more than 58,000 people have done just that to go through the INSEAD MBA program in hopes of taking their careers to a new level. The man who founded INSEAD, Georges Frédéric Doriot, had a knack for figuring out where to make a buck. Mr. Doriot is also considered to be the father of venture capital when in 1957 he invested $70,000 for a 70% share of DEC which was later acquired for $9.6 billion – the largest merger in the history of the computer industry at the time. Since then, the venture capital industry has thrived with more than 1,000 venture capital firms managing in excess of $400 billion.

For retail investors, the venture capital domain has largely been off limits. In order to become a “limited partner” and place money with a venture capital firm to invest, you need to be wealthy and connected. As for the alternatives, there aren’t many. Very few venture capital firms are publicly traded. Who wants to deal with all that extra paperwork? Still, there are some. Anyone remember TINY?

Valuing a Public VC Firm

Anyone who has been a Nanalyze reader since back in the day knows the story of Harris and Harris Group (now called 180 Degree Capital) which used to be a publicly traded venture capital firm that invested in nanotechnology startups and now trades under the ticker TURN. The idea of owning a portfolio of startu