Capitalizing on opportunity

Four PwC alumni share their thoughts
on venture capital.

Image:Mary Bevelock

Mary Bevelock began her career with PwC in 1985. Today, she is CFO of Globespan Capital Partners.

Before Google was a verb. Before movies were delivered to our homes dressed in red envelopes. Before people shelled out real cash to buy virtual real estate assets, there were investors willing to put their money behind a simple entrepreneurial idea.

For more than three decades, venture capital (VC) firms have fueled the world’s most innovative companies—some placing bets on nothing more than a concept born in a college dorm room. Yet these ideas have completely transformed the way we live, work and play. VCs funded the birth of biotechnology in the 1970s, software and semiconductor industries in the 1980s, and online retailing in the 1990s. Today, they are paving the way for mobile and clean technology.

Venture-backed companies drive a solid share of our economy, accounting for 11 percent of private-sector employment and an estimated 21 percent of the US GDP. According to a 2009 IHS Global Insight study commissioned by the National Venture Capital Association (NVCA), venture-backed companies accounted for 12.1 million jobs and $2.9 trillion in revenue in the US alone in 2008.

Like everyone, VC firms have had to deal with a tough economy the past couple of years. But a recent MoneyTree™ Report from PwC and NVCA, based on data provided by Thomson Reuters, shows the market is improving. The report indicates VC investments increased 49 percent in dollars in the first half of 2010, with $11.4 billion in investments going into 1,646 deals. The number of deals themselves has increased 23 percent compared with the first half of 2009.

Keyword recently spoke with four PwC alumnae now serving in finance positions at top US firms to learn about the inside workings of venture funding. Three of the firms, Kleiner Perkins Caufield & Byers, Redpoint Ventures and InterWest Partners, are located at the world’s largest VC hub: Sand Hill Road in Menlo Park, Calif. The fourth, Globespan Capital Partners, is headquartered in Boston. We discovered a tight-knit community of finance professionals who lean on each other for advice and willingly share their own.