Win The Future

When a startup is just an idea and a few employees, it looks for seed-round funding. When it has a product that early adopters like or when it's run through its sed-round money it tries to raise an A round. Once the product catches on, it's time for a B round, and on the rounds go. Most VCs contemplating an investment in one of these early rounds consider the same factors. They just go down a checklist: monthly recurring revenue, founder with experience, good sales pipeline, X percert of month-over-month growth. VCs also pattern match: if kids are into Snapchat, fund things like it such as Yik Yak, Streetchat, ooVoo. Or, at a slightly deeper level, if two dropouts from Stanford's computer science PhD program created Google, fund more Stanford CSP dropouts, because they blend superior capacity with monetizable dissatisfaction.

However, venture capitalists with a knack for the 1,000x know that true innovation doesn't follow a pattern. The future is always stranger than we expect: mobile phones and the Internet, not flying cars. The biggest outcomes come when you break your previous mental model. The black-swan events of the past forty years – the PC, the router, the Internet, the iPhone – nobody had these around. So what's useful is having large ears. A great VC keeps his ears pricked for a disturbing story with the elements of a fairy tale. This tale begins in another age which happens to be the future, and features a hero harnessing magical technology to prevail. The tale ends in helping treasure chests for all, borne home on the unicorn's back.

Silicon valley, the fifteen-hundred-square miles 20 miles south of San Francisco was called Santa Clara valley until the rise of the microprocessors in the nineteen seventies. It remains a contested ground. Armies of startups attack every idea, with early employees – and sometimes even their lawyers and landlords – taking deferred compensation, in the hope that their options and warrants will pay off down the line. Yet workers' loyalty is not to a company or even to an idea but to the iterative promise of the region. NASDAQ is built on the efforts of thousands of people in the Valley and on the back of the iPhone and Android and GPS and battery technology and online credit-card payments all stacked together.

VCs give the Valley its continuity – and its ammunition. They are the arms merchants who can turn your crazy idea and your expendable youth into a team of coders and marketers with large size monitors. Apple and Microsoft got started with venture money so did Starbucks, Home Depot, Whole Foods Market and JetBlue. VCs made their key introductions and stole from every page of Sun Tzu to help the startups penetrate markets. And yet VCs maintain a zone of privacy around their activities. They tell strangers they're investors or work in technology, because in the Valley that valorizes the entrepreneur, they don't want to be seen as just the money.

Silicon Valley VCs are all techno-optimists. They have the belief that you can take a geography and remove all obstructions and have nothing but a free flow of capital and ideas, and that it's good, to creatively destroy everything that has gone before. The game in Silicon Valley is not ferocious intelligence or a contrarian investment thesis: everyone has that. It's not even wealth: anyone can have an idea and become the next Mark Zuckerberg. It's prescience. And then it's removing every obstacle to the ferocious clarity of your vision including incumbents, regulations, folkways, and people. The beauty of betting on risky technology is that you're sometimes proved right, eventually. Here's some new work for Inventus Partners upcoming event for Startup bridge in Palo Alto. For more information visit Inventuscap.com for their upcoming event that brings new tech startups with unbridled capital.