Using Blogs To Dispense Venture Capital

prostoalex writes "The New York Times describes how Tim Draper, a founder of Draper Fisher Juvetson venture capital firm, is trying out a new approach to finding the next entrepreneurial superstars. In his Web log (which NYTimes mysteriously never links to, but it's on AlwaysOn-Network), Draper asks the readers to leave the comments with their billion-dollar ideas. The winners of this pitch were selected recently, and just reading the comments with innovative ideas is quite interesting."

Comments

This seems like an interesting idea...

[Zugot]

But I don't know if I would want to submit my idea out in the public before I had a chance to gather some financing to protect it. I also don't want my competitors to get an early leg up on my business before I have a chance to become competitive.

All in all, this is interesting idea. I'm glad to see people using technology in all forms of business. This one idea may help four more just like it come to fruition. This can only be good for folks searching for venture capital.

Re:This seems like an interesting idea...

[gl4ss]

well, for those wild ideas you don't even intend to execute it's great - if somebody likes it enough to even make it worth your time to pursue some silly dream all the better.

Intellectual Property Theft

[Sean80]

The first thing that came to my mind when I read this was: "What about IP theft?" I, like many people who think they've had their "big idea," am not too keen on putting it out on the web, where I have no patents or copyright to protect the idea, and where anybody and everybody can come along and put my idea into practice without paying me a dime.

Maybe this is just the paranoia of one inventory, but I wonder how many people would be comfortable doing this sort of thing, and whether this would select any particular sub-population of entrepreneurs by its very nature.

Re:Intellectual Property Theft

[AKAImBatman]

I considered this issue as well. Then I realized that anyone who attempted to implement my ideas would be missing many of the key ingredients necessary to make it work. i.e. I can give a presentation to venture capitalists that they might like, but the details that make the idea work technology wise are still stuck in my head. Anyone who attempts to steal the idea will either be winging it and come up with a useless implementation, or will already understand what I'm trying to do and have the concept already in their head.

Re:Intellectual Property Theft

[prostoalex]

Most of the successful businesses are not ideas, they are execution. Look at successful Internet companies right now: online marketplace, online bookseller that's not selling electronics and a lot more, large-scale information archival and retrieval system. Every once in a while you have Edison-like geniuses coming up with brilliant ideas that turn the world around and occasionally make their inventors rich, but more often than not, it's the execution, not the idea that matters.

And don't forget that Draper is not the only one, as NYT article states, he's one of the few people that would invest in half-baked startups, but nevertheless in the venture world he's still one of many. And there's $70 billion dollars out there ready to be invested into the next venture. VCs got a bit tough lately with dot bomb and everything, but the money is still out there, and there are fewer ideas, than there are brains.

Re:Intellectual Property Theft

[femto]

The following relates specifically to Australia, but might also apply to the US?

I'm not sure that it is so simple. I've been looking into this issue and the legal status of online 'publication' seems to be cloudy.

How do you prove that something has been published online? The patent applicant can claim that the date is false and some way is needed to prove the date and contents of publication. Even then, does a court recognise online as being published?

I've been seriously looking into starting an 'open source' journal here in Australia. This journal would publish one paper copy of each issue, complete with an ISSN and would be lodged with the National Library of Australia. By law the National Library of Australia is required to receive one copy of everything published on paper in Australia. This is an eample of the difference in status between paper and online publication, as the NLA requirement does not apply to online publishing.

Is anyone aware of a more straight forward way to establish prior art *beyond all doubt*?

Apart from the above the point is that the examination system is broken, so prior art has every chance of being ignored, requiring an expensive court case to be recognised.

Re:Intellectual Property Theft

[HeyLaughingBoy]

"What about IP theft?"

The simple answer is that ideas are a dime a dozen. Really. The power of an "idea" isn't the concept, it's the execution. And there's a long, long road from idea to finished product; that's why the overwhelming majority of "ideas" never make it.

Think of it this way: you have an idea. Now how will you make it happen? Can you raise the capital? If you can't, then what value is that idea to you? And remember that if it's really profitable, there are probably already 1,000 people who have the same idea and are trying to find funding just like you are.

Contrary to popular belief, no one pays money for ideas. What they will (sometimes) pay for is the idea, plus a *detailed* plan of how it will be put into action, along with market research and analysis, income projections, etc. Even then, most investors will prefer to give their money to someone who's already done all that and is generating income, if only a little.

Even here on Slashdot, you can often see comments to stories that go "I had that idea xxx years ago, I should have patented (?) it, etc..." The difference between that /. poster and the person who made the news is that the latter actually executed it successfully.

Blogs are impolrtant in business AND politics

[Nova Express]

It's not surprising that venture capitalists are following blogs. Despite the vast amount of kibble out there only of interest to the blogger's friends ("I took my Snookypums to the vet today..."), the best of them are frequently scooping major media on important stories.

For example, it was a blog that first broke the story that MoveOn.org was Astroturfing on behalf of Michael Moore's Farenheit 911 . Likewise, I read about it first on a metablog, National Review Online's The Corner. I haven't seen any of the major media pick up this story yet (though many have already been fooled by Astroturfed letters).

Though an immature medium, it will be interesting to see where Blogs go next.

Don't worry about people stealing your ideas.

[Sunlighter]

If your ideas are any good, you'll have to ram them down people's throats.

-- Howard Aiken