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Using Blogs To Dispense Venture Capital

Posted by timothy on from the two-birds-with-one-buzzword dept.

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."

36 of 121 comments (clear)

  1. Presentation, Presentation, Presentation... by TWX · · Score: 3, Funny

    So, if I can theoretically pitch an idea so it sounds absolutely awesome but in reality is totally full of crap, then I too can get venture capital money to use to create a company and pay myself a massive salary? Cool!

    --
    Do not look into laser with remaining eye.
    1. Re:Presentation, Presentation, Presentation... by sentientbeing · · Score: 3, Funny

      ive got this great idea for collecting email addresses to help people market products using the internet.

      Send me an email and ill tell you all about it.

      --

      ------
      beware he who would deny you access to information, for in his mind he dreams himself your master
    2. Re:Presentation, Presentation, Presentation... by MrAndrews · · Score: 3, Interesting
      I have an article I wrote a whole back dealing with this concept of the "idea men" not being able to execute their own innovations properly. The one thing that a lot of former dotcom execs told me was that they wish they'd sold out soon before they got the big company with all the programmers and Coke machines, because the biggest lesson they learned was that they didn't know how to run a business as well as they knew how to come up with great starter ideas.

      I think this blog approach - despite the fact that it's horribly risky for people with good concepts - is closer to the ideal. Find the talent out there, get them to give their baby a kickstart, and then (likely) buy it away from them to make it really successful. People need to see where they fit into the bigger picture, and not try and be in every shot.

      I should update that article sometime... hmm...

      --
      The world's only surviving livewriter.
  2. I never got the word "blog." by Power+Everywhere · · Score: 2, Interesting

    What is its etymology?

    --

    BLING BLING. Meet the architecture that's changing everything.

    1. Re:I never got the word "blog." by Anonymous Coward · · Score: 5, Funny

      its short for weblog. But they took the we out because it's usually for "me me me".

    2. Re:I never got the word "blog." by kartiknarayan · · Score: 2, Informative

      Web-log... shortened to 'blog'

  3. Hehe... by robson · · Score: 2, Interesting

    When skimming the headline, I first thought it read, "Using Blogs to Dispose of Venture Captial"...

    Doesn't sound like much of a challenge, but hey, it's a slow news day :)

  4. This seems like an interesting idea... by Zugot · · Score: 4, Insightful

    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.

    --
    -- Bryan
    1. Re:This seems like an interesting idea... by gl4ss · · Score: 2, Insightful

      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.

      --
      world was created 5 seconds before this post as it is.
    2. Re:This seems like an interesting idea... by autopr0n · · Score: 2, Informative

      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.

      Usualy the winning submissions come from companies that already exist, have a few people and at least some work done on the product. They're not just handing out money for hair-brained ideas :P

      --
      autopr0n is like, down and stuff.
  5. Agh I Hate eTechnology by t_allardyce · · Score: 3, Funny

    I dont want to troll, but I personally would just remove any idea that called itself a technology made up of two words StuckTogether(tm) people just need to be slapped and told no.

    --
    This comment does not represent the views or opinions of the user.
  6. Oh, the irony... by Anonymous Coward · · Score: 5, Funny

    http://www.alwayson-network.com/...

    Heh, heh, heh.

  7. Well, that's how it used to work. by stoneymonster · · Score: 4, Interesting

    I personally witnessed $300 million of VC money come to naught. And our product worked. Even a good idea which is completely implemented is no guarantee of success. If giving money out based on slideware alone is alive and well, then the bubble never really burst. -C

  8. always-on.com by artemis67 · · Score: 3, Funny

    No, it isn't.

    Thanks, /.

  9. Intellectual Property Theft by Sean80 · · Score: 4, Insightful
    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.

    1. Re:Intellectual Property Theft by Anonymous Coward · · Score: 5, Interesting

      This is a classic scam pulled by venture capitalists. They have been known to take great ideas from presentations by companies that are courting their financing and give the ideas to companies already in the stable. I personally wouldn't trust this blog idea further than I could drop kick it.

    2. Re:Intellectual Property Theft by AKAImBatman · · Score: 2, Insightful

      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.

      --
      Javascript + Nintendo DSi = DSiCade
    3. Re:Intellectual Property Theft by natmsincome.com · · Score: 2, Funny

      Hmmm,

      So all I need to do is invent a way of drop kicking a blog.

      I'll get back to you.

    4. Re:Intellectual Property Theft by prostoalex · · Score: 4, Insightful

      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.

    5. Re:Intellectual Property Theft by femto · · Score: 2, Insightful
      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.

    6. Re:Intellectual Property Theft by femto · · Score: 2, Informative
      I can see that this can be used to prove that you were thinking or knew something on a particular date, but doesn't prior art require that your ideas be disseminated, not just posted to yourself?

      To counter the use of registered mail, the patent holder might argue along the lines: "Yes your honour, the mail proves that this person was thinking about my invention on that date, but they did not publish it until later. I claim that any page put on the Internet was different to the page in that envelope."

      The problem seems to be that prior art requires not only invention but publication. Registered mail proves the invention part but not publication.

      Have I misunderstood?

    7. Re:Intellectual Property Theft by HeyLaughingBoy · · Score: 2, Insightful
      "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.
  10. and the winning idea was... by laserbeak · · Score: 2, Funny

    The winner had an inovative idea about server bandwidth. Too bad they had no time to implement this new discovery!

  11. Yeah, right by melted · · Score: 3, Funny

    OK, folks. I'm a millionaire and I've put together this blog where you can help me to become a billionaire for free.

    Nice thinking, dude. Try again. :0)

  12. In the US by autopr0n · · Score: 2, Informative

    You have two years after public disclosure before you have to patent your idea.

    --
    autopr0n is like, down and stuff.
  13. Hate-o-Matic. by eddy · · Score: 2, Funny

    Yeah, everyone knows the correct pattern is $(sillything)-o-matic. For instance, I'd buy a Sludge-o-Matic(TM), but I'd never buy a SludgeMatic(TM) -- cause -- well, that just sounds completely stupid.

    --
    Belief is the currency of delusion.
  14. My Great Idea... by bfg9000 · · Score: 4, Funny

    ... a website where nerds can get together and read about stuff that matters to them, and people can comment and then others can moderate those--- nah... that'd never work. Who'd actually pay for that? Duh.

    Therefore, my new great idea is the Sex Helmet.

    --

    I'm not normally an irrational zealous dickhead, but I figure "When in Rome..."

  15. 'Just do It' by Greg@RageNet · · Score: 2, Interesting

    With the state of things and what CPU cycles, open source software, and co-location costs these days, who needs venture capital if you are starting an online business. If you are sharp and have decent sysadmin and coding skills you can do it yourself.. Find yourself a partner that's got complementary sales and marketing skills and you're set. I've done this with my own startup KnowTraffic and am doing rather nicely without selling my virtual soul to the the VC's.

    -- Greg

    --
    Slashdot, would a spell-checker for posting be too much to ask? It's not rocket science!
  16. I have this idea, a site that survives slashdottin by brak · · Score: 2, Funny

    SO I'm sure it's worth millions, but wouldn't it be cool if you were able to have a website that was robust enough to survive if it was mentioned in a slashdot article... an article with only 80 comments, no less.

    So I would like, get some bandwidth, and like, get some servers that didn't suck, and maybe like hire this dude to write an app that didn't suck. So like, if you do that, then there's like this weird chance that when you get bombed with traffic people will still get a page back...

    I dunno though, I think it'll cost like $20 million. Oh my gawd, so hardware alone would cost like $5K, and bandwidth would be aboue $1K/month... (cogent) oh, and then there's the dude, another $100K/year.... so for $20M you should be able to keep this running for about 178 years. Wheee!!!

  17. Potentially Dangerous by jnguy · · Score: 2, Interesting

    Why can't I just browse through all those ideas, and act quicker than these people. Head to the patent office, use my own capital, etc. Publicly viewable ideas are dangerous.

  18. Garage.com already does this by Animats · · Score: 2, Interesting

    Garage.com has been doing this for years. They have some modest successes.. Guy Kawasaki ran Garage.com for a while, after he quit Apple.

  19. Great place to steal ideas, get ideas for free by shodson · · Score: 2, Interesting

    Hey, what kind of schmuck would post their idea to the public like this? The same schmuck that will give away 99% of his company for Draper to have them fund it for $1M.

    On the other hand, DFJ have funded some pretty gutsy ventures in the past, so I gotta give them props for trying something different.

  20. Don't worry about people stealing your ideas. by Sunlighter · · Score: 3, Insightful

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

    -- Howard Aiken

    --
    Sunlit World Scheme. Weird and different.
  21. Stealing ideas. How unethical. Quick let /. him! by syousef · · Score: 2, Funny

    Oh wait a second we already have...

    --
    These posts express my own personal views, not those of my employer
  22. Some might, but Draper wouldn't by krysith · · Score: 2, Interesting

    In defense of Tim Draper, I have presented a proposal to DFJ (Draper Fisher Jurvetson) without a non-disclosure statement or any other form of IP protection. He merely gave us his word of honor. Maybe I was stupid, but our idea was technical enough that he could not have reproduced our work without a few years of his own work. I was under the impression that discussing ideas without a form of IP protection is standard operating procedure at DFJ. They basically use their reputation as backing.

    Of course, we got funded, so YMMV.

    I would be interested to see any verifiable stories of DFJ backstabbing someone in such a way. I worked with Tim for 5+ years and I just don't see him doing that.

    I'm not too surprised to see Tim doing something like this. He has a lot of energy and is always trying some new idea. Supposedly he is the one who came up with the idea of putting the little blurb at the bottom of free email (Hotmail) in order to get more people to try it. That got buzzworded as "viral marketing".

    a former CEO of a DFJ startup (Fiat Lux Research)

  23. Poor man' s Patent = Provisional Patent by krysith · · Score: 2, Informative

    A much better idea, in the US, is to apply for a Provisional Patent. Look it up on www.uspto.gov. Basically, it establishes patent rights for 1 year, during which you must apply for a patent if you want one. At the end of the year, the information you disclosed becomes public knowledge, if the patent has not been applied for. It's relatively cheap (compared to a regular utility patent), at $80 for a "small entity" (like an individual inventor). The prov pat has much more legal standing than a sealed and dated envelope.