Ben Horrowitz of
new Valley based fund Andreessen-Horowitz has a good post
up today promoting an open source legal project for seed stage
investments.
His discussion of how the requirements of companies have changed over the last ten years is spot on and very illustrative for the debate about the evolution of venture capital:
It turns out that building a company has changed quite a bit since the early days of venture-backed technology companies. Building a company like Twitter or Facebook is quite different from building Tandem. Specifically, the risk and cost of building the initial product is dramatically lower. I emphasize product to distinguish it from building the company. Building modern companies is not low risk or low cost: Facebook, for example, faced plenty of competitive and market risks and has raised hundreds of millions of dollars to build their business. But building the initial Facebook product cost well under $1M and did not entail hiring a head of manufacturing or building a factory.
To read the full, original article click on this link: The venture capital model – how building a company has changed | The Equity Kicker
Author: Nic Brisbourne
