Conference Report: ESVCA Chairman Bullish on Year Ahead

By Alex J. Stockham
PrivateEquityCentral.net
January 31, 2002

At the Strategic Research Institute’s Private Equity Roundup in Scottsdale, Ariz., Vincent Occhipinti said he views 2002 as one of the best periods to invest in early stage deals since he began in the business in 1983. He said that valuations are down 50% to 70% and there is less competition for deals. Dealing with portfolio companies is also easier, he added.

Vincent added cautioned that venture capital firms need to remain patient and understand that liquidity will not occur overnight, like it may have in the late 1990s.

Portfolio companies are helped by the ESVCA because the candor generated at the sessions allow GPs to hear from other firms who may have dealt with a problem they’re currently facing. The collective experience lets the firms share information, as well as expand their network of contacts.

Occhipinti said that in order for an early stage firm to be successful, they need to provide more than capital. Once the capital structure is in place, the best way to help a company is by introducing it to people who can help them grow, whether they’re potential customers or potential investors. A key for Woodside, Occhipinti said, is partnering with management to ensure that the firm and the company are “on the same page.”

The Woodside Fund was founded in 1983 and has total capital commitments of $200 million. The firm typically invests in six to eight companies per year, with $5 million to $15 million committed over the life of the investment. The firm focuses on communications, networking, enterprise software, and electronic commerce companies. The firm also looks for co-investment opportunities with other venture capital firms.