Think back to the 1980s, when corporate raiders, savings and loan owners and their Wall Street enablers were the finance world's rock stars. When the raiders were borrowing like crazy, the vultures were biding their time in solid, liquid investments that missed both the boom and the ensuing bust. Ironically, there's a lot of dry powder at the incubators and venture funds that raised capital when things were hot, didn't have a chance to spend it all, and lately have seen their stock prices fall below the value of their remaining cash. If these guys play it right, they have a chance not just to survive, but to invest the rest of their capital at prices that will look dirt cheap, when the market turns back up.
Fees are higher here than for the average mutual fund.
So you have to assume divine's portfolio is way underwater. But thanks to that late IPO, divine interVentures hasn't had a chance to do all that much investing. And it seems to be taking the right steps to cut its burn rate, including laying off 18 of its 41 employees and shedding some of its current holdings. Most important, it's changing its focus from incubating dot-coms to rolling them up into bigger, potentially stronger firms. It holds stakes in 24 companies, most of which will need more capital to survive.