Wednesday, March 01, 2006

VC Dinosaurs

Umar uncovers the problem with VCs:

"But I think it's becoming increasingly clear that, today, VCs are deeply resistant to change. If you factor in the pre-crash, it's taking two cycles - 14 years - to change VC. That is an incredibly long time - especially for an industry that's supposed to be about innovation!

Three simple examples.

Ask yourself: is it really efficient for VC to have so little turnover compared to any other industry?

How is it possible that while every other industry in the world has undergone wrenching change, VC looks almost exactly the same as it did 20 years ago?

Is it any coincidence that while the VC overhang (uninvested cash) piles up, the very definition of the term innovation is shifting to a class of players who are clearly much hungrier - like Ideo, Cheskin, Doblin, etc - and are busy redefining innovation on their own terms, as a design-driven discipline?"


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