The Hottest Silicon Valley Accounting Startup: A Conversation with inDinero Founder Jessica Mah

Posted on by The Other Ari Gold
One of the biggest distractions for small-business owners has to be maintaining their books and their accounting. Attaining a firm for the business might be too expensive an endeavor, yet handling it by yourself takes away valuable time from growing your core business. Enter inDinero: a one-stop shop for all your bookkeeping needs. The company nearly went under before launching with an additional offering which now includes tax prep, among other features.
 
I had the opportunity to catch up with the Founder & CEO of inDinero, to learn more about how they meet their client's needs and how a couple of non-accountants in Berkeley came up with the accounting software success it is today. 

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Angel Investors Continue to Shy Away from Startups

This story is republished from CFOZone, where you’ll find news, analysis and professional networking tools for finance executives.

Many startups, especially ones with high-growth potential, depend on receiving at least some of their funding from angel investors. Now, a new report sheds light on what type of entrepreneurial ventures got angel money last year.

Specifically, the report from the Center for Venture Research at the University of New Hampshire found that financing for really early-stage companies declined and a larger percentage went to more-established ventures. That is, 35 percent of investments in 2009 were in seed stage companies, a decrease of 10 percent from 2008. And new, or so-called first sequence investments, were 47 percent of all angel activity, a significant decline over the last two years.


What this means, of course, is that angels are favoring proven quantities that are less risky than newer ventures. That’s been a trend for several years now and it’s worrisome. You might not know it from press coverage, but angel funding is considerably more prevalent than venture capital financing: Many more startups receive angel money than VC dollars. So, if angels shy away from early ventures, that means the loss of a significant historical source of funding for these companies.

Then, there’s the matter of what these companies mean to the economy, which I’ve written about before. The startups that receive angel money tend to be ones with high-growth potential, the kind with at least a fighting chance of becoming a lot bigger and employing a lot of people. Thus, it’s not a positive development over the long haul if angels choose to play it safe and avoid very early-stage ventures.

On the modestly good side, the report showed a decrease in investment dollars but little change in the number of investments. Total investments in 2009 were $17.6 billion, down 8.3 percent from 2008. But a total of 57,225 ventures received funding, a 3.1 percent increase from 2008. In other words, more startups got money, although deal size was smaller.

It would be more reassuring if a larger share of the $17.6 billion had gone to a different type of venture.

PwC Report: Venture Capital Activity in New York Jumps While Silicon Valley Sees a Slide

This story is republished from CFOZone, where you’ll find news, analysis and professional networking tools for finance executives.

Silicon Valley is still central headquarters for venture capital activity in the US. But it looks like the New York City area is trying to play catch up.

A new report shows an increase in the region both in the amount of startup funding and the number of deals for two consecutive quarters, while activity in Silicon Valley dropped.


The report, from PricewaterhouseCoopers and the National Venture Capital Association, found that financing for companies in and around the Big Apple increased to $566 million in the first quarter. That was an 18.9 percent rise from the previous quarter, also a 34 percent year-over-year increase. A total of 75 firms received money in the first quarter, up 13.6 percent.

In Silicon Valley the story was very different. Investment dollars and numbers still won out over New York, of course. But the trend was down. Total funding of $1.5 billion in the first quarter represented a 21.4 percent drop from the fourth quarter 2009, while the number of deals fell 24.6 percent over the same period.

Overall share of VC money also rose in New York and fell in Silicon Valley. In New York, it reached 12 percent, up from 9.2 percent in the fourth quarter 2009, compared to 32.3 percent for Silicon Valley, down from 37.5 percent.

This New York- area investment growth reflects recent efforts by venture capitalists and the New York City government to rev up funding.

A few examples:

Last spring, New York law firm Lowenstein Sandler started First Growth Venture Network, which provides mentoring for newbie CEOs from venture capital firms, angels and more-seasoned executives.

Last fall, they announced the first 15 CEO mentees. Late last year, seven successful entrepreneurs launched the Founder Collective to make $50,000 to $1 million investments in very early-stage ventures in New York, as well as the Boston area.

In early 2009, NYC Seed, a partnership of venture capital, non-profits and universities, made its first investments in several seed-stage ventures.

Last week, I wrote about trends in angel investing and noted that such financing provides more money for startups than venture capital. Still, although VCs invest in a small percentage of all new companies, they do support enterprises with potential to become real powerhouses. So, the New York area economy clearly benefits both in the short and long-term from this financing activity.

Although it’s doubtful these firms will ever match the contribution in tax dollars and jobs provided by Wall Street.