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NEW YORK -- I was at a party in Northern California over the weekend. It was a very good party. These folks are expert drinkers. They bend to the task year in, year out, weekend after weekend, regardless of the season. Fortunately, they're merry drunks and like each other's company.
It's something baked into the DNA of the venture capitalism game. Look at the model:
- I have money, which I give to you to pursue your little idea. You develop your idea to the point where it can be sold to somebody who has none. During that time, I can do whatever I want with you to grow your bulb into a tulip I can sell. I then sell your pretty flower, take all my money back and then some. The guys who grew the thing get a little taste, but are for the most part left holding the bag. The tiny, wafer-thin notion wilts inside the big hothouse that acquired it, generating the requirement for a massive writedown. I'm still rich even though nobody else involved in this is.