South by Southwest

Here's what tech investors were talking about at SXSW this week


Venture capitalists come to SXSW to learn about the biggest trends in tech, and meet and mingle with current and potential portfolio companies.

And this year everyone's talking about two big things that have nothing to do with what's happening here in Austin: What Snap's IPO and President Trump's administration mean for startups and investing.

Snap and the IPO Window

Investors, always looking for opportunities to make good on their investments, were bullish about Snap's effect on the IPO market.

"I think it re-opens the IPO window," says Revolution co-founder Steve Case. "We'll see more public offerings in the next year."

Steve Case
Michael Newberg | CNBC

Greylock partner Josh Elman is pushing companies to strike while the iron is hot. "The market seems like it's at all time-highs, people are actually bullish on the jobs reports and everything else," says Elman. "So we're encouraging every company that feels like it's ready to be a public company not to wait."

See also: Okta files to go public, setting up an exit for some of Silicon Valley's most prominent investors

Case also points to the boost this gives to Snap's home of Los Angeles, part of a trend he calls "the rise of the rest"-- the rise of tech hubs outside Silicon Valley. "Los Angeles even five years ago wasn't viewed as a great start-up city. Because of Snap it's now become a hotbed of innovation," says Case.

The CEO of sports betting site FanDuel, Nigel Eccles, who's in the process of merging his company with rival Draft Kings, says this bodes well for him and other startups down the road. "I think Snap's IPO has been fantastic for the tech industry," says Eccles. "It just shows their strength, it also shows broader strength in the tech industry. Snapchat's the focus, but when we talk to investors there's a lot of excitement in technology, so that's great."

Trump and immigration

The biggest concern among the VCs we talked to is over immigration, and the importance of welcoming talented engineers and entrepreneurs from over all over the world to drive our high-tech economy.

"It's been a few months and there are things that have been disconcerting to me particularly around immigration," said Steve Case. "I think we need to take steps that will win a global battle for talent, be a magnet for talent, build bridges for talent, not build walls. That concerns me."

NEA Partner Rick Yang echoed Case's concern that Trump's immigration laws will dampen innovation. "We think a lot about the immigration laws," said Yang. "One of the things America is great at is attracting talent, and so having immigration laws that help harness that and help continue to attract the best talent, is going to be what we think about in terms of our business."

Josh Elman also said he's worried about some other policy issues that could impact startups: "There are some concerns with net neutrality, there are some concerns with what's going to happen with healthcare, and how that effects W2 workers and 1099 workers, and I think that's a real shift," says Elman.

But Elman also sees some potential upside if Trump's policies push companies to spend back here in the US: "I think one of the most interesting ones is whether they allow repatriation of all that foreign income," says Elman. "That might make the M&A market something we haven't seen in years."