Mentor Capitalist

Futuredex
November 18, 2002
Adam Phipps




Clearstone Venture Partners, with offices in Menlo Park, Ca., and Santa Monica, Ca., is actively investing out of their $350 million second fund, and have about a dozen investments left to make. This fund follows their successful initial $100 million fund.

The firm is an early-stage investor, and is typically a company's first institutional investor. They base their investments on the west coast, but occasionally travel east.

Vish Mishra, Partner at Clearstone Venture, who joined the firm earlier this year, says the company invests heavily in communication and enterprise software, inclusive of Internet companies. He considers investing in these markets essential to the future.

"The Internet has shaped our lives like never before," says Mishra. "The Internet and communications are essential, and we are barely scratching the surface of what could happen in this space."

Clearstone limits the number of investments they make, so they can work closely with the company. "We invest in few companies and are more actively involved in their growth--we are true believers in our companies," says Mishra.

An example of Mishra's vision is Clearstone's investment in PayPal, the Internet escrow service recently bought by eBay. Clearstone helped shape their early business model, and put $5 million toward PayPal's Series B round of funding. PayPal announced its initial public offering in February 2002. Clearstone examined two-dozen Internet payment companies and decided to put their stake into PayPal.

Mishra also extols the virtues of enterprise software. "I spent my life in the real time enterprise, and it's an important trend and movement. The cycle time from gathering data to a business design is dramatic and needs to be streamlined," he says.

In the enterprise software space, Clearstone has invested in Exemplary Software, a developer of software solutions that allow manufacturers to reduce their inventory and working capital and promote enterprise efficiency. Clearstone led a $12 million round in the company, with support from The Woodside Fund, Lightspeed Venture Partners, Discovery Ventures, and JT Venture Partners.

Mishra considers himself a "mentor capitalist." He explains: "For any individual to succeed, they need a mentor. I love to advise and guide. I have been doing this through entrepreneurial and non-profit organizations. I am an entrepreneurial mentor."

He was a serial entrepreneur before joining Clearstone, and considers his a great background for investing. "The firm collectively has an advantage. Knowing what it takes to build a business is important. I don't see much of a difference between being a venture capitalist and an entrepreneur. The element of risk taking is similar to that of an entrepreneur."

Mishra has spent 30 years running technology companies. He is a founder and board member of Telera, a voice over the Web portal, funded in excess of $120 million. They sold to Alcatel this year. His prior experience also includes founding and serving as VP of Operations of Excelan; a VP at Novell and; CEO of Mindworks, IntelliMatch, and Ace Software.



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