5 ms·

A list of deals one VC firm passed on -- Google, eBay, Apple, Intel, Fedex, Paypal, etc.

79 points by smoody 19y ago

smoody 19y ago
an oldie but a goodie. you gotta love this entry: Cowan’s college friend rented her garage to Sergey and Larry for their first year. In 1999 and 2000 she tried to introduce Cowan to “these two really smart Stanford students writing a search engine”. Students? A new search engine? In the most important moment ever for Bessemer’s anti-portfolio, Cowan asked her, “How can I get out of this house without going anywhere near your garage?”
pg 19y ago
I've always liked this list. BVP is no different from most VC firms in this respect. What's unusual about them is that they're so candid about it. I was just talking to some founders about what terribly bad judges VCs are, compared to how confident they seem. They're in the same position as governments. All governments are horribly inefficient, but they don't realize it because their only competitors are other governments. Come to think of it, this may be changing. Now that startups are so cheap to run, companies rejected by VCs are increasingly likely to survive to embarrass them.
- dangoldin 19y ago
  I'm glad they are humble enough to provide that information. What do you think of the idea that companies that are cheap to run may face stiffer competition and thus never really gain a large chunk of the market, thereby never making it "astronomically" big. At one point the network effect will come into play as well as consolidations down the line but it's an interesting thought.
- questus 19y ago
  "I was just talking to some founders about what terribly bad judges VCs are, compared to how confident they seem. They're in the same position as governments. All governments are horribly inefficient, but they don't realize it because their only competitors are other governments." -Cough- Y Combinator too -cough-
- ivankirigin 19y ago
  Do you know of any companies you haven't accepted into YC that have been particularly successful?
  - vegashacker 19y ago
    Here's one that was successful, though not in the traditional sense: Damien Katz applied to YC with his Couch DB idea and got rejected (http://damienkatz.net/2006/11/how_not_to_pitc.html http://damienkatz.net/2006/11/how_not_to_pitc.html), but now he works for IBM and gets to do CouchDB full-time (http://damienkatz.net/2008/01/new_gig.html http://damienkatz.net/2008/01/new_gig.html).
    - plinkplonk 19y ago
      " Damien Katz applied to YC with his Couch DB idea and got rejected (http://damienkatz.net/2006/11/how_not_to_pitc.html http://damienkatz.net/2006/11/how_not_to_pitc.html), " His blog entry on the YC rejection is dated 11th January 2006. The one on the IBM job is dated 1st january 2008. So Damien essentially took the rejection in his stride, didn't bother whining, and kept on hacking. Very impressive.
  - pg 19y ago
    I don't know of any offhand, but I bet there are some.
goodgoblin 19y ago
Makes me wonder - is it all luck at some level? After the fact one can look and see - what made all the successes successful? What attributes do they all share? Is it only that they succeeded?
- jrockway 19y ago
  I don't think it's 100% luck. Larry and Sergey liked working on search engines and said "hey, let's make a company". It turned out that other people liked their search engine too, so they made money. If you have the same passion for something else, that's only half the battle. The other half is making sure your passion aligns with the passion of people willing to give you money. I've come up with a few good ideas in my life that I'd love to do as my "real job", but I know nobody else would be interested. That is why I am not a millionaire :) Of course, the luck is being able to predict what people will want.
  - dangoldin 19y ago
    It would be even better if you were able to share your passion with others and then capitalize on that ensuing demand. It seems Google may have reached that point when every one of their new products is praised and lauded - they make the market where none existed yet.
  - goodgoblin 19y ago
    I hear what you are saying - I'm just thinking luck is the multiplier - ebay, google, etc - how many other search engines aren't as successful? how many ebays does no one know about? I guess luck is timing to some degree - but its also plain luck. All of the monday morning quarterbacking that goes on seems obvious in retrospect, but the future is still completely uncertain. VC's expect 1 in 10 to fail b/c thats just historically what has happened. If they knew what made the 1 hit they wouldn't fund the 9 losers. I'm just saying, really nothing new I guess, that the business of predicting the future by looking at the past is colored by confirmation bias. What characteristic do all self made men have in common? They took alot of risk. However, thats also the same trait incarcerated bank-robbers have in common. I'm just saying prediction is impossible. By all means do what you love b/c if it crashes and burns at least you won't have hated the last 2 years of your life.
kleevr 19y ago
Struck me as a bit of the tactics mentioned in No Logo. (anti-portfolio=anti-marketing) But I'm young, and still a tad too stupid I'm certain... :) It's all very nuts though, and I agree the world is starved for honesty. Honesty, how do we become more honest when we might even be lying to ourselves?...
- kleevr 19y ago
  transparency
simianstyle 19y ago
Is it me, or is the site down?
- dmpayton 19y ago
  http://downforeveryoneorjustme.com/www.bvp.com http://downforeveryoneorjustme.com/www.bvp.com
pxlpshr 19y ago
I think we're all hoping one day we'll have a similar story. I know I am... :)
ciscoriordan 19y ago
Article about other missed VC opportunities: http://www.boston.com/business/articles/2004/11/08/nothing_ventured_nothing_at_all_gained/ http://www.boston.com/business/articles/2004/11/08/nothing_v... The VC arm of Allstate Insurance passed up 20% of Microsoft for $8 million. Ouch.
- brk 19y ago
  The funny thing is that with 20% investments come board seats (usually). With board seats come influence. Influence affects outcome. It is completely possible that had any of these VCs actually put money into these missed investments, that the "investments" could have taken an entirely different (where different == bad) path. The end outcome of a startup is often the result of several key variables. Change any one variable, and so changes the outcome.
  - aswanson 19y ago
    Allstate Insurance had/has a VC arm? What on earth.....

79 points by smoody 19y ago

an oldie but a goodie. you gotta love this entry: Cowan’s college friend rented her garage to Sergey and Larry for their first year. In 1999 and 2000 she tried to introduce Cowan to “these two really smart Stanford students writing a search engine”. Students? A new search engine? In the most important moment ever for Bessemer’s anti-portfolio, Cowan asked her, “How can I get out of this house without going anywhere near your garage?”

pg 19y ago

I've always liked this list. BVP is no different from most VC firms in this respect. What's unusual about them is that they're so candid about it. I was just talking to some founders about what terribly bad judges VCs are, compared to how confident they seem. They're in the same position as governments. All governments are horribly inefficient, but they don't realize it because their only competitors are other governments. Come to think of it, this may be changing. Now that startups are so cheap to run, companies rejected by VCs are increasingly likely to survive to embarrass them.

dangoldin 19y ago
I'm glad they are humble enough to provide that information. What do you think of the idea that companies that are cheap to run may face stiffer competition and thus never really gain a large chunk of the market, thereby never making it "astronomically" big. At one point the network effect will come into play as well as consolidations down the line but it's an interesting thought.
questus 19y ago
"I was just talking to some founders about what terribly bad judges VCs are, compared to how confident they seem. They're in the same position as governments. All governments are horribly inefficient, but they don't realize it because their only competitors are other governments." -Cough- Y Combinator too -cough-
ivankirigin 19y ago
Do you know of any companies you haven't accepted into YC that have been particularly successful?
- vegashacker 19y ago
  Here's one that was successful, though not in the traditional sense: Damien Katz applied to YC with his Couch DB idea and got rejected (http://damienkatz.net/2006/11/how_not_to_pitc.html http://damienkatz.net/2006/11/how_not_to_pitc.html), but now he works for IBM and gets to do CouchDB full-time (http://damienkatz.net/2008/01/new_gig.html http://damienkatz.net/2008/01/new_gig.html).
  - plinkplonk 19y ago
    " Damien Katz applied to YC with his Couch DB idea and got rejected (http://damienkatz.net/2006/11/how_not_to_pitc.html http://damienkatz.net/2006/11/how_not_to_pitc.html), " His blog entry on the YC rejection is dated 11th January 2006. The one on the IBM job is dated 1st january 2008. So Damien essentially took the rejection in his stride, didn't bother whining, and kept on hacking. Very impressive.
- pg 19y ago
  I don't know of any offhand, but I bet there are some.

goodgoblin 19y ago

Makes me wonder - is it all luck at some level? After the fact one can look and see - what made all the successes successful? What attributes do they all share? Is it only that they succeeded?

jrockway 19y ago
I don't think it's 100% luck. Larry and Sergey liked working on search engines and said "hey, let's make a company". It turned out that other people liked their search engine too, so they made money. If you have the same passion for something else, that's only half the battle. The other half is making sure your passion aligns with the passion of people willing to give you money. I've come up with a few good ideas in my life that I'd love to do as my "real job", but I know nobody else would be interested. That is why I am not a millionaire :) Of course, the luck is being able to predict what people will want.
- dangoldin 19y ago
  It would be even better if you were able to share your passion with others and then capitalize on that ensuing demand. It seems Google may have reached that point when every one of their new products is praised and lauded - they make the market where none existed yet.
- goodgoblin 19y ago
  I hear what you are saying - I'm just thinking luck is the multiplier - ebay, google, etc - how many other search engines aren't as successful? how many ebays does no one know about? I guess luck is timing to some degree - but its also plain luck. All of the monday morning quarterbacking that goes on seems obvious in retrospect, but the future is still completely uncertain. VC's expect 1 in 10 to fail b/c thats just historically what has happened. If they knew what made the 1 hit they wouldn't fund the 9 losers. I'm just saying, really nothing new I guess, that the business of predicting the future by looking at the past is colored by confirmation bias. What characteristic do all self made men have in common? They took alot of risk. However, thats also the same trait incarcerated bank-robbers have in common. I'm just saying prediction is impossible. By all means do what you love b/c if it crashes and burns at least you won't have hated the last 2 years of your life.

kleevr 19y ago

Struck me as a bit of the tactics mentioned in No Logo. (anti-portfolio=anti-marketing) But I'm young, and still a tad too stupid I'm certain... :) It's all very nuts though, and I agree the world is starved for honesty. Honesty, how do we become more honest when we might even be lying to ourselves?...

kleevr 19y ago
transparency

simianstyle 19y ago

Is it me, or is the site down?

dmpayton 19y ago
http://downforeveryoneorjustme.com/www.bvp.com http://downforeveryoneorjustme.com/www.bvp.com

pxlpshr 19y ago

I think we're all hoping one day we'll have a similar story. I know I am... :)

ciscoriordan 19y ago

Article about other missed VC opportunities: http://www.boston.com/business/articles/2004/11/08/nothing_ventured_nothing_at_all_gained/ http://www.boston.com/business/articles/2004/11/08/nothing_v... The VC arm of Allstate Insurance passed up 20% of Microsoft for $8 million. Ouch.

brk 19y ago
The funny thing is that with 20% investments come board seats (usually). With board seats come influence. Influence affects outcome. It is completely possible that had any of these VCs actually put money into these missed investments, that the "investments" could have taken an entirely different (where different == bad) path. The end outcome of a startup is often the result of several key variables. Change any one variable, and so changes the outcome.
- aswanson 19y ago
  Allstate Insurance had/has a VC arm? What on earth.....