Venture firms put another $225.7M into 66 Silicon Valley companies last quarter, with $52.5M (23%) going to 24 software companies. Berkeley Systems (Berkeley) got $6M for multimedia and entertainment software; Crystal Dynamics (Palo Alto), $2M for game software. Edify (Santa Clara) got $8M for intelligent, agent-based information retrieval; Reach Software (Sunnyvale), $3M for PC-network intelligent document-processing software; Objective Software (Redwood City), $2M for desktop information- analysis tools; Strategic Mapping (Santa Clara), $4M for desktop mapping software; Interactive Solutions (San Mateo), $150K for multimedia presentation software. Academic Systems (Palo Alto) got $740K for CAI in higher education; Edge Diagnostics (Sunnyvale), $762K for automotive diagnostics. Other investments were for CAD, CAE, process control, client-server systems, network management, OODBMS, data conversions, mobile/pen-based software, and other business applications. US venture outlays for 1992 were $2.5B, with $.9B in Silicon Valley. The outlook is good, according to Venture Economics (Boston). [Steve Kaufman, SJM, 3/8.] $52.5M creates quite a few new jobs, but few are in R&D. (720 venture-backed firms created 23K jobs last year and are planning to hire 29K this year, according to Ventureone.) You might want to join one of these growing companies, then work your way into R&D.

Small firms with limited opportunities (e.g., $25M-$75M in sales within 5 years) have found it difficult to raise venture capital as most funds are concentrating bigger investments in fewer companies. Small businesses have tapped up to $60B/year from wealthy "angels," but get little business guidance. (Non-venture small technology firms expect to grow only 6.5% this year.) Indosuez Ventures (Menlo Park) and Quest Ventures (San Francisco) are starting to back small businesses, and Crosspoint Venture Partners (Los Altos) has just closed a $60M fund for seed companies. Crosspoint looks for $5M-$10M investments leading to initial public offerings (IPOs). Indosuez investments may be around $500K-$800K, cashed out when your company is sold to a larger one. They've reported 20% return on their first fund, and such success will draw other venture money. (15% per year is more typical.) [Steve Kaufman, SJM, 3/8.]

Trip Hawkins' 3DO Co. (San Mateo, CA) is making a $250M public stock offering even though it won't have its multimedia entertainment products for sale until at least Christmas. Wall Street is hot for IPOs, especially in multimedia -- but may be less interested by Christmas. Selling stock at a high price now -- $10-$12 per share -- will set the value for later stock offerings. [Mike Langberg, SJM, 3/16.] Wall Street has also been pumping up other electronic entertainment stocks this month, including Broderbund and Trip's previous venture, Electronic Arts. [Don Wiegandt, KCBS.] It's too late to buy IPOs, as only mediocre issues are coming to market. Brokers are making money by recommending their own IPOs, but the advice is suspect. Wait for the next cycle or "window." [Steve Kaufman, SJM, 3/8.]

What do you get when you cross a lemming with a sheep? A venture capitalist. Or, according to Michael Schrage, a multimedia investor. Multimedia is "hot" these days, but there's no evidence of any real market. [SJM, 3/22.] (Not a great career area?)