Fred didn’t like some of the points I made in my “real entrepreneurs don’t raise venture captial post,” which was a response to a conversation we had over sushi earlier this week, so he fisked me.
I just responded on his blog I’m posting his fisking right here:
Some fair fisking there however, I don’t really like that term, it feels sort of, well, what’s the word I’m looking for here invasive?
The title is obviously a joke. I mention how many businesses require VC investment and you confirm this with your list. I also mention VCs have made a huge positive impact on our economy in the story. So we agree on the first point you say we disagree on but this is fisking, who’s counting.
Second, in terms of this angelic view of the VC who gives 100% of their focus to their companies I think you are talking about YOUR style as a VC.
I’m sure YOU are 100% focused on all your companies, and I know almost every CEO you’ve invested in and I’ve never heard anything bad from them (the Urban Fetch folks well, that’s another story).
I’m on the entrepreneur side and I hear the horror stories (I also heard them on the editor side at Silicon Alley Reporter).
Many VCs cram down, pinch, and shut down struggling companies to put their focus on other things.
It was the VCs who pushed peopleentrepreneurs to go biglike stupid bigin the hey day.But I digress.
We both know VCs don’t have the time to waste on sick companiesyou say it clearly up top when yo mention how much work the stuggling companies are. The more time they take the quicker you need to pack them up and get them out the thing is, what a VC sees as success is different then what an entrepreneur might consider success. That’s the disconnect, the companies a VC gives up on an entrepreneur might not give up on.
There are three sides to every story your side, my side, and the truth. I think the truth about VC money lies between your idolized version of the VCs who would just die for that struggling company letting the EBAY executives wait in the lobby on their blackberries. My version where the entrepreneur is in a dog fight and the VC is dating someone else and taking days to return calls and won’t do the next round was only two years ago for many of us entrepreneurs and they don’t forget (I was never in that position of course). Many of the entrepreneurs have been doing business in their own circlesleaving the VCs out.
There are a number of high networth individuals investing out there, and folks Scott at Meetup and Scott Rafer at Feedster are doing these style of investments from what I’ve readso has Weblogs, Inc. as you know.
I think what you’re upset about (you seem a little upsetare you?) is that your job is getting harder. the top entrepreneurs find venture capitalist a little too extreme and expensive in many cases I know you know this is the case.
You’re a top rated and respected VC and you’re going to have deal flow issues with the new fund I’m sure the best deals are getting done E2E.
VCs need to rethink what they offer and the deal structure they’ve done for decades. It’s a new world and Internet businesses don’t need VCs in many cases. Most of the companies being bought by Yahoo and Google these days go from angel funding to salethey SKIP THE VC STEP! You know this to be true.
Now, will Scott, Rafer, and I wind up in your conference room some day hammering out deal points?! Perhaps but that’s because you’re one of the good guys and you’re offering to get in the trenches with us. You’re will to take your time and rethink deal structure, and not because you’re the only game in town like the old days.
fisk that baby. 🙂