Venture Capitalists With Powerful Blogs May Run Afoul of the SEC

I have heard investors say, "I'm not in deal ABC, but I could have been / wish I was, because now those guys are killing it." Is that fraud? While that type of talk can excite people to act, if the investor isn't involved...idk. Oftentimes, the common public perception a company is 'killing it' is neither news (to the general tech public), nor is it always true (lots of companies appear to be killing it, but are running out of cash.).

Another scenario is when a VC talks publicly about an investment they are in, in conjunction with details about how the company is performing. I can't recall ever hearing this type of talk, though I'm sure it does exist. In these cases, I'd suspect, as long as the company isn't about to go public, fraud would still be questionable. If this type of information was used to persuade other institutional investors, who conduct their own diligence, I'm not sure the statements hold much meaning. With private investments, which are not usually liquid, and investors are selected...it's akin to Goldman making the argument that their clients are professional investors and therefore responsible to make their own investment decisions. However, with the introduction of Second Market, this might not be the case. In the event that private stock acts like public stock, forward looking statements (either positive or negative) that move the market could have a fraudulent effect.

The whole situation is unclear, especially considering the rare IPO and Second Market effect, VCs can really only defraud professional investors / acquirers. In those cases, I'm not sure their words have much of an affect. However, VCs could potential make statements and sell stock on 2nd market.

It'll be interesting to see how it all works out and whether or not Second Market will be able to trade private company stock in the future.

I wonder if Fred Wilson and Marc Andreessen have buyer's remorse today. These SEC appointees didn't fall from the sky, they came from this administration.

http://www.avc.com/a_vc/2008/11/barack-hussein.html

  A world class management team. I remember the first debate 
  I ever watched Obama participate in. He was asked whether 
  he was a "strong operatating executive." He replied that 
  he was not "the COO", that he was more like "the CEO". And 
  then he went on to talk about surrounding yourself with 
  the best people you can find and then letting them do 
  their job. He did that with his campaign which was a 
  masterful thing to watch, he did that with his VP pick (in 
  stark contrast to the Palin fiasco), and I expect he'll 
  build a killer cabinet and a killer administration (look 
  for some picks from across the aisle).

  Marc Andreessen: We asked him directly, how concerned should we be that you 
  haven’t had meaningful experience as an executive — as a 
  manager and leader of people?

  He said, watch how I run my campaign — you’ll see my 
  leadership skills in action.

  ...

  He’s got my vote.