Biggest Surprises of 2009:

• Massive smart phone (particularly iPhone) adoption this year, truly validating mobile as "the 3rd screen." Google buying AdMob for $750M didn’t hurt either.
• I'm surprised that everyone was surprised about investment banking bonuses. Its an industry built on bonuses! If it quacks - it’s a duck!!
• IT Enterprise spending post-crash came back as fast as it did. No, we are not at ‘99 levels, but this is a strong and large market that isn't going away.
• News flash: Tiger *blanks* hot chicks in Vegas and Nike doesn’t care. Surprised? Really?
• Sarah Palin. Nuf said.
• John and Kate are getting back together. I'm so relieved.

Best Predictions for 2010:

• Wireless service providers spend more money on infrastructure to support rate of data consumption - this will be the year that networks are truly open.
• Enterprises large and small continue to embrace cloud computing and software as a service. Why invest in non-core IP when you can rent?
• Congress passes a privacy law this year that will have a ripple effect in the online targeting market. Harder to drop those cookies. This will also be the last year where "click thru" remains a dominant advertising measurement.
• Google does a deal with the record labels...it will be a creative JV great for Google and not so great for anyone else. YouTube music videos rocketing (and benefiting Google now) have made this a certainty.
• For our country...a plus that health-care reform passes and a minus that Osama bin Laden remains at large this year.
• Tiger is still lookin’ for love in all the wrong places.

Biggest Surprise of 2009: Attending the inauguration of our first African American president.

Best Prediction for 2010: The U.S. will invest heavily in modernization and revitalization of its crumbling infrastructure. Big money to be made in the process.

Biggest Surprise of 2009: A pleasant surprise was the way our portfolio companies reacted quickly to the downturn. They made some very tough decisions but I think they became tougher, leaner and more focused – and so did we. Maybe that's the way we should be all the time, so let’s hope that the lessons stick with us.

Best Prediction for 2010: I think 2010 will be good for startups. Customers who deferred purchases in 2009 will come back into the market in 2010 with a renewed focus on infrastructure for improving basic platforms and efficiency. I think (and hope) that 2010 will be a good year for exits as well – whether by IPO or M&A. Virtualization and cloud computing will continue to mature but the transition will be measured for enterprises.

Biggest surprise of 2009: The vehemence of the negative reaction towards attempts to move the U.S. health-care system in a more positive direction. (Luckily, from a minority of the population, but it is a noisy minority.) Similarly, the vehemence of the negative reaction towards energy legislation that would put the U.S. on a path towards energy independence and environmental sustainability. (Interestingly, coming from roughly the same noisy minority. Hmmm …)

Best Prediction for 2010: Both comprehensive health-care and energy legislation will be passed, albeit with some (tolerable) compromises. The Democratic majority will recognize that they need to drive towards what is best for the country as a whole, vs. listening too much to the noisy minority and special interests. OK, I’m an idealist, but hope springs eternal ...

Biggest Surprise of 2009: The unbelievably rapid rise of Facebook as a mainstream communications medium for all ages. Facebook has done this in spite of NO visible business model.

Best Prediction for 2010: Human sequencing will become a commercial reality.  Before mid-2009 it was widely recognized that 8 complete human gene sequences had been compiled.  In 2010 the number will be in the thousands.

Biggest Surprise of 2009:  Android-based phones are coming out at a much more rapid rate, across more hardware platforms, than I expected. We could see another Apple duopoly here, a la PC Windows vs. Mac. While Apple’s iPhone is much more open than the Mac was – the same issue of broad hardware adoption and scale (read cost) of an “industry standard” could rise again, only this time with Apple having seen its user interface lead nearly eliminated in just a few years. Against a broadly accepted platform, their lead in applications won’t last that long either.

Best Prediction for 2010:  The IPO market will be much stronger in 2010 than people expect today. While we certainly won’t party like it’s 1999 again, by the second half of the year we’ll be talking about how great a year it is for IPOs.

Biggest Surprise of 2009:  Other than the wonder of watching Stanford smoke both USC and Oregon in consecutive games in football, the biggest surprise of 2009 was how long the recovery has taken, and how difficult it's been to regain economic traction.   This is not 1929. We are in the information age. In the Great Depression, Ma and Pa Kettle in northeast Arkansas could not tap into CNN.com (let alone TMZ.com) to find out what was really happening at the banks and in the underlying financial structure of the country. All they knew was that banks were collapsing and they needed to get their money out ASAP and bury it in the backyard. It was years before the news got to them that the banking system had been stabilized and they could re-inject their savings into the economy. Not so today. All of us could see on a real-time basis the reaction of the government and the banks and the financial infrastructure to the crisis, and whether you agreed politically or not, there was little doubt that heroic efforts were being made to ensure the stability of the system. This created confidence, no matter how tenuous, and has allowed money and credit to flow, albeit cautiously, on a time scale that is orders of magnitude faster than in the Great Depression.  My surprise is that the underlying structural weakness has been sufficient to keep the recovery modest. The Dow is back, but unemployment lingers at very high rates.  My hope is that confidence will return more robustly in 2010 and that we will roar out of this crisis into a fantastic new growth economy.

Best Predictions for 2010:  Okay, here we go:

Super Bowl winner: Minnesota Vikings (Brett Favre MVP, then retires…)

NBA Championship: Who cares – I live in Seattle…

Washington finish in NCAA tournament: Lose in 2nd round in an upset

World Series champion: Boston Red Sox. Really.

World Cup champion: Brazil (U.S. out in first round again…rats)

Tiger Woods tournaments played: 4 (majors only…working on a divorce settlement otherwise)

Dow year end: 11,990

Favre year end: Un-retires, now hates Vikings for limiting his options, joins Vikings biggest NFC North rival to spite them…Packers

Apple new product: iSee, contact lens-like monitors that are not touch screens but instead are “look” screens activated by eye movements and wirelessly control CPU’s the size of iPhones that you carry…or maybe not

Seattle Genetics: Huge positive news in multiple trials, stock doubles at a minimum

Zymogenetics: Not quite as much good news…

Mayor McGinn: Re-stripes every arterial route in Seattle for bike lanes. Violence ensues between bikers and commuters not seen since WHO riots

OVP: We make some investments in really cool new ideas, we get some fantastic exits, and we continue to be one of the best partnerships in which to work.

We know this is the most popular page on the OVP web site: Deals Missed

So, therefore rather than post this new information assuming loyal readers will stumble upon it, we figured we might as well put it up here on the blog, too - and let you enjoy watching us wring our hands, yet again.