Subject: Re: shooting holes in the sky
From: "Stephen J. Turnbull" <turnbull@sk.tsukuba.ac.jp>
Date: Wed, 10 Oct 2001 13:22:28 +0900

>>>>> "Tom" == Tom Lord <lord@regexps.com> writes:

    Tom> Right.  VCs are, at a very high level, doing tactical
    Tom> engineering but have little or no strategic component to
    Tom> their investments.

Um, yes.  That's what their financial models are good for.  "Don't act
so disappointed."  :-)

    Tom> Someone needs to say to them "Don't act so surpised."

The ones who are any good aren't, they factor the herd effect in to
their projections.  The ones who aren't any good, you don't want to
deal with, anyway.  So don't bother teaching Great-Aunt Agatha to suck
eggs.

We'd be much better off learning enough about the VC business to
figure out how to give them the figures that they need to run through
their cookbook financial models.  Their job is _not_ to do strategy.
Strategy requires domain knowledge, if they wanted domain knowledge
they would become entreprenuers.  Domain knowledge is our job.  Their
job is the tactical finance.

Neither developer nor VC knows much about market analysis.  The VC who
can get that down will be in a much better position to talk to
developers about strategic investment.  I doubt developers will ever
be very good at market analysis, but there may be some sort of
three-way team that could be more effective than the duets we're
seeing as conventional venture organization.


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