Between the IPO drought and a slowdown in M&A, Marty Pichinson can’t answer the phone fast enough these days.
Pichinson is cofounder of 27-year-old Sherwood Partners, long known to industry insiders as “the undertaker” of the venture industry. Its primary role is to efficiently shutter companies, and, when possible, to return a little something to their creditors. And as you might guess, demand for its services is growing in a straight line toward the sky right now. (Among some of the high-profile startups Sherwood is in the process of winding down are bankrupt mobile content provider Amp’d and the bankrupt residential home phone provider SunRocket.)
So they're trying to squish together failing Web 2.0s so they won’t have to write off their investments entirely.
Is that a sign of trouble, or business as usual?
You know what I think? I think the economy, excuse my French, sucks right now. You have no secondary market for mortgages. You got an energy crisis that’s killing us all. You’ve got storms and floods in the Midwest. Things are a mess, and we haven’t seen anything yet. Q3 and Q4 are expected to be worse. Credit card debt is going to collapse. Hedge funds are dying. Limits are going to start suing everyone. It’s a perfect storm, almost like mankind has never seen. Shit happens, but the venture model works.