The future of First Tuesday, the investment "club" that helped create many Internet startups, has now been thrown into doubt itself by the financial woes of its parent, Yazam. The Israel-based firm, which funds Internet startups, has been put under pressure by shareholders to sell assets, and now may merge with another company to cut costs.
Yazam chairman Shlomo Kalish said last week he would not consider winding down First Tuesday, but this week admitted the parent company itself might have to end its operations and return funds to investors if no better option can be found. Shareholders include Merrill Lynch & Company, Texas Pacific Group, and Carlyle Internet Partners.
First Tuesday was founded two years ago as a series of industry get-togethers where entrepreneurs could meet up with their peers and with eager venture capitalists, but soon evolved into a series of international meetings, held on the first Tuesday of each month. Yazam purchased the operation for about £34m in July.
First Tuesday has helped find the initial funding for businesses such as Confetti, the online weddings planning service, Lastorders, and Clickmango, which has since gone into liquidation.
Internet companies have faced a dramatic reduction in value and increasing suspicion from investors over the last year, and Yazam itself lost the heads of its US and Israel operations, Phil Garfinkle and Yaacov Ben-Yaacov, in November.
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