Not so long ago I spent an afternoon listening to a half-dozen entrepreneurs hawk their ideas for new companies. The event was called a pitch day, and it had an American Idol feel. The presenters stood before massive power point displays in the cavernous auditorium of a converted warehouse, spinning their best stories of why their concepts would attract the most eyeballs, customer subscriptions, or advertising attention. Each wanted to launch a fast-growing business – the next tech rocket ship – and made their case to the judges, a collection of investors spread in front of the makeshift stage in neat rows of plastic chairs. Winning meant the entrepreneurs got a little extra cash, fuel for their rockets, and a chance to turn their concepts into real startups.
The presenters had been honing their pitches for weeks, seeking that right combination of words, images, and dramatic delivery that might persuade the investors to pick them. The event was glitzy. The pitches slick. But the substance?
Of the six proposals, each could be boiled down to “the next” (fill in the blank with Facebook, Twitter or Google) for (fill in the blank with a sliced-up market segment). Each was a derivative concept meant to piggyback in some way off the platforms created by more ambitious entrepreneurs who came before them. These ideas were less about originality than they were about exploiting market niches that were not yet the focus of the platform companies. There was not much stretching for greatness.
This is not necessarily a bad thing. Commerce has long thrived on tweaking others’ ideas, but at some point it seems someone has to push forward the vision thing. I believe it was frustration with a lack of startup imagination that prodded Bruce Gibney of the Founders Fund to pen this missive in April 2011. He called it What Happened to the Future? and attached this brilliant subtitle: We wanted flying cars, instead we got 140 characters. From that letter:
The future envisioned from the perspective of the 1960s was hard to get to, but not impossible, and people were willing to entertain the idea. We now laugh at the Nucleon [a nuclear-powered car] and Pan Am to the moon while applauding underpowered hybrid cars and Easyjet, and that’s sad. The future that people in the 1960s hoped to see is still the future we’re waiting for today, half a century later. Instead of Captain Kirk and the USS Enterprise, we got the Priceline Negotiator and a cheap flight to Cabo.
It’s not a huge surprise why the pitch day ideas were so ho-hum. The entrepreneurs are running towards the money. Venture capital as an industry is more interested in backing the thing that seems most likely to get acquired (and thereby provide quick returns on their capital) than in backing bold bets. That makes sense. We need it. But we also need capital that backs the bold ideas. We need capital for the bets that might take years and years before paying out. I applaud Bruce Gibney and his colleagues at the Founders Fund for attempting to play that role. I applaud Google’s X labs for working on their own initiatives to change the world. My hope is that they prod more investors to take a long-term perspective.
When capital makes itself available for bold ideas, I expect we’ll see entrepreneurs tap into their more creative impulses. I expect we’ll see pitches that will bring promise of this future we’ve been waiting for.