The web industry has evolved significantly for the past 2 years. We have attended a big wave of innovation from web startups supported by a dynamic VC/investor infrastructure both in the US, Europe and China. But we're observing a move on to a different stage. Many realize that the VC investments are down since the beginning of the year, that the Silicon Valley has a innovation crisis ahead. We hear about the term "bubble" coming back, although most people cannot rationnally explain it. We are probably entering a selection cycle where many startups won't be able to make it
What i think is that the market is maturing, and that the web economic fundamentals are still strong and growing and therefore that there are still some nice opportunities to come ahead. Too many startups have been funded chasing the same opportunity. Meaning that the moment of truth is coming for many actors and that many investors want to see some results before pouring more money in their ventures. Specially in early stage.
On the other side it has never been such a good time to build a successful business on the web: internet penetration is growing, ad expenditures are moving more and more to the web away from traditionnal media and ecommerce is still enjoying a very nice double digit growth year on year.
This means that the opportunities are here but that investors are more careful about what they do. At LgiLab we performed a few seed investments which initial goal is to help a project start quickly and reach the market and validate the concept. Over time our attention is captured more by projects that have a clear ability to reach a critical size and monetize their service very quickly during the seed period.
Many times seed investment is associated with proof of technology and traction, but since the internet market is maturing, our approach to seed investment is also maturing.
We have performed 6 investments so far in the Internet Lab, and we have just closed a 7th investment that we ll disclose very soon. This 7th investment is the illustration that more and more new projects fit that profile of young companies with early monetisation validation.
Does that mean we won't invest in projects that cannot immediately monetize? no, but it means that will pay stronger attention to the capacity of the company to reach during the seed period some strong business validation, beyond the concept, the execution and the traction.
I believe this is a natural evolution of things, we are observing in Israel that entrepreneurs are also maturing according to that trend. They are more aware of the necessity of building a business on the web whatever the vertical is.
Startups should be aware it is going to be harder and harder to raise money at very early stage. Alternative financial channels coming from angels, new structure like Ycombinator, Seedcamp or even university programs will be important to help young projects validate the product/traction phase. New opportunities are also coming up with the mobile web. Although yet very young, it is clear that mobile advertising and ecommerce will be a reality (Apple is generating 1 million dollars a day with the AppStore). But even with that promise investors will be more careful, because of the unknown timing factor.
So bottom line: we believe it is still a good time to invest on the web, but the filter is stronger. A sound filter. One that precisely will help us avoid a second bubble, although a strong death rate is likely to happen in the next 12 months.
I rarely get excited by a blog plugin; But i have been trying 
