By Sarah McBride Reuters
Posted: 02/21/2012 03:06:12 PM PST
Updated: 02/21/2012 08:30:31 PM PST
Article from The Inside Bay Area
SAN FRANCISCO -- Josh Buckley, chief executive of an online gaming startup, is looking forward to next month's Game Developers Conference in San Francisco, particularly for the parties and the accompanying schmoozing with industry A-listers.
There's one problem: Buckley, who will turn 20 this week, may be turned away from many of the parties because he is not old enough to drink. His fake ID was recently confiscated, and the two new ones he ordered from a company in China have not yet arrived.
Such are the dilemmas facing the ever-younger entrepreneurs that Silicon Valley investors are backing these days.
Although little data on the phenomenon exists, venture capitalists say they are funding more CEOs under age 21 than ever before.
"At a certain point, they can't get much younger or we're going to be invested in preschool," quipped Marc Andreessen, whose venture capital firm Andreessen Horowitz is one of several that backs Buckley's company, MinoMonsters.
Andreessen and other venture capitalists say the entrepreneurs they fund at 18 or 19 typically have been prepping for years -- learning computer code, taking on ambitious freelance projects and educating themselves on the Internet.
Joe Kraus of Google (GOOG)
Ventures helped back Airy Labs, an educational social-gaming company run by 20-year-old Andrew Hsu that raised $1.5 million.
Hsu is now learning the same hard lessons as many of his elders: The company recently laid off staff and is looking to rent out some of its office space in Palo Alto.
Kraus said his biggest hiccups with young entrepreneurs are the business references they don't understand because they are too young to be aware of them.
Andreessen says more than one young entrepreneur has asked him: "What did Netscape do again?" Andreessen co-founded Netscape, which developed the first commercial Web browser and helped launch the Internet era, shortly after graduating from college in 1993.
"I was 9 years old" during the first Internet boom, says Brian Wong, 20, who runs reward-network Kiip. He has had his fill of stories about companies that tanked amid the dot-com bust of 2000. The first time he heard the name Webvan, a legendary dot-com failure, "I had to look it up."
While the freewheeling ways of youth may be a positive for venture capitalists, they are less appreciated by landlords. Tim Chae, the 20-year-old CEO and co-founder of social-media marketing company PostRocket, said his age and lack of credit created problems when he moved to San Francisco last year and needed an apartment. Finally, his father drove 88 miles from Sacramento to co-sign a lease.
Chae, a Babson College dropout, lives in Mountain View and attends 500 Startups, a crash course for young companies run by a venture firm of the same name.
He has raised a small amount of capital and hopes the upcoming Facebook IPO will help investors look more kindly on young entrepreneurs. "Thank God for Zuckerberg," he says.
Article from The Inside Bay Area