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Summary:

Spark Capital has had a busy few years. It launched in 2005 after raising $260 million, raised another $360 million in July 2007 for a secon…

imageSpark Capital has had a busy few years. It launched in 2005 after raising $260 million, raised another $360 million in July 2007 for a second fund, and announced a funding initiative five weeks ago to focus on smaller bets in the $250,000 range. Spark has invested in a range of digital media companies, from thePlatform, which was sold to Comcast (NSDQ: CMCSA) for $100 million, to buzzy startups including Twitter, Veoh, Boxee and Tumblr. The firm has invested heavily in online video, which has come under pressure the last year because of the tough ad environment and has steep operating costs. Last week, I sat down with Mo Koyfman, principal at Spark, who came to the Boston-based VC fund from IAC (NSDQ: IACI) where he held a variety of strategic, transactional and operational roles. We talked about VC culture, Twitter (in which Spark is an investor), and the Asian gaming industry, among other topics.

Excerpts from our conversation are after the jump.

A Sanford Bernstein analyst published a report recently in which he called out Silicon Valley for having a culture where large Internet companies are often wooed by VCs into buying buzzy startups that have no real business model. What is your response to that?

There are certainly deals you can point to where businesses were bought that performed poorly, yet there are many other examples where they have performed tremendously well for the acquirer. It

  1. It's surprising that someone like Mo, who has failed at every position he's ever held (according to the Spark website), can be put at the helm of properties with such growth potential. Hopefully he is on a short leash as to not jeopardize their futures too much.

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  2. Michael, thank you for your comment, but I respectfully disagree. Many feel that while at IAC Mo had a good eye for attractive acquisitions and integrating them into a larger company, which is no easy thing.

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  3. A good eye for financial transactions has very little to do with the vision required to make a judgment about Twitter. Get real!

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  4. I don't see anything in here that explains why "Twitter Won't Fail."

    It might succeed, it might not.

    Tons of massively popular services end up failing or going out of business.

    I think they were smart to build out an api and keep advertising off the site (to stimulate signups and usage) but that doesn't mean the business will survive or exist in the long run.

    Perhaps a different title is in order.

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