Seattle's Madrona Venture Group has been winning its bets on local and regional tech startup companies since the mid-1990s.
One of its early investments? A little ecommerce company called Amazon.
Since then 30 of its companies have been acquired or gone public. It currently manages nearly $1 billion in 45 companies serving a wide range of tech sectors - companies such as Redfin, Apptio, BuddyTV, Cheezburger, ExtraHop and WildTangent.
Managing partner Matt McIlwain sat down with KING5 News to give his take on what technologies Madrona will be eyeing in 2014, whether Seattle's tech scene can finally escape Silicon Valley's shadow, and what entrepreneurs need to keep in mind as new services and products make it easier for them to bring startup companies to life.
Some interview highlights:
Given the blockbuster Twitter IPO, how do you think tech companies performed overall in 2013?
"2013 was a strong year with companies meeting or exceeding their operating plans, and what we're finding - what we think that means - is there's a whole new selling motion, a bottom-up selling motion where small startups can quickly build new products, test those products and then sell those into the marketplace. 2013 was the year, I think, where we're going to look back and we're going to say that was the year that really changed the game in terms of bottom-up, innovative selling."
Doesn't any of this tech activity remind you of previous bubbles?
"What's interesting about this current cycle is there's a lot of substance to it. Now the companies that are going public have substantial revenue, substantial revenue growth, and while not always profitable right when they're going public, they're managing their way to profitability, so we feel more confident in the substance of this current cycle."
What sectors show the most promise in 2014?
"We hear a lot on the consumer side about sensor-based technologies..all of these relatively low-cost abilities to capture data about me can help me be more productive, efficient and healthy in my life. We're just on the edge of that. There was an acquisition this week - Google paid over $3 billion for a company called Nest, which is basically a next generation modern thermostat. Google? $3 billion? A modern thermostat? What's going on there? Well that's a part of this whole sensor-driven economy. Some people like to refer to it as the Internet of Things. We're big believers in that category."
Everybody talks about Silicon Valley's great VC and tech scene, and they say Seattle's is good, but could be better. Do you agree?
"I don't think we mind at all being underappreciated. I think the piece that sometimes works against Seattle is that we do have an understated personality, and at some level you need to amplify your story, you need to be able to get out there on a national stage and talk about why these technology trends and the talent that's here and the companies that are from here, and building here, are really the best in the world."