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Ryan Jacob is back -- older, wiser and a little chastened, but still very bullish on the Internet. The former mutual fund manager's first 15 minutes of fame were as a poster boy for the dot-com stock bubble. By 29, he was riding two straight years of triple-digit gains. What better time to go out on his own? To great acclaim, the Jacob Internet Fund was launched in late 1999 -- just in time for the bust. It fell like a stone, posting annual losses of 79, 56 and 13 percent from 2000 to 2002. The once-wunderkind's name became synonomous among financial pundits with how not to do it. A funny thing has happened since then. Jacob, and his fund, have come back with a vengeance. He was in San Francisco this week to tout the retooled Jacob Internet Fund, a $100 million vehicle which has racked up 25 percent annual gains over the past five years. It has also earned a somewhat grudging five-star seal of approval from mutual fund rater Morningstar, which seemed worried about endorsing another bubble. Now a polished 37-year-old, Jacob said he's learned his lessons and now focuses on both growth and value among Internet stocks. "I realize 'Internet value' is like saying 'jumbo shrimp,' Jacob said. What he means is finding down-on-their-luck electronic media stocks like News Corp. and Napster. In addition to seeking a robust return for his shareholders, Jacob is looking for vindication: That his fall from grace was just a case of wrong place, wrong time. "I'm seeking redemption, and I'll get it. I'm still young,"
Jacob said, quickly adding that he's "squeaky clean" from
a legal perspective. And he should know, having undergone three
SEC audits over the past six years. Entrepreneurs are used to getting a song and dance from VCs, just usually not literally. But in another sign of perhaps irrational exuberance breaking out in the venture world, four VCs have been making the rounds to sing Christmas carols at this month's holiday parties. The headliners include Thomas Shields, a managing director at the Woodside Fund; Randy Haykin, a managing director at Outlook Ventures; Tim Chang, a partner at Gabriel Ventures and Dave Binetti, an entrepreneur. (Apparently, even when it comes to creating a quartet, VCs want an entrepreneur in residence.) The group was inspired by fellow VC Onset Ventures' holiday card of a few years ago in which the firm rewrote the lyrics of several holiday carols to feature topics more germane to venture capitalists than that peace-on-earth, goodwill-to-men nonsense. "A couple of us were sitting around saying, 'Wouldn't it be great if someone actually sang them?'" Haykin said. Haykin and partners have obliged, after updating the topics and expanding the genre to a repertoire of five. A sample includes this little ditty to the tune of Jingle Bells: ...YouTube Sells, Facebook's on the way As to the usual VC concern -- what's the potential return on this -- the answer is none at all. It's not a paying gig, and nobody's planning to quit their day job. "It puts things in perspective, and we're having a good time," Shields said. -- Compiled by Jim Gardner. Contributor: Mark Calvey.
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