But there are times when a critic truly risks something, and that is in the discovery and defense of the new. The world is often unkind to new talent, new creations. The new needs friends.
-Anton Ego, Ratatouille
There are times when the business of being a venture capitalist seems an awful lot like being a professional critic. We review hundreds of opportunities every year and it is part of our job to turn down most of them. Every entrepreneur I know who has raised money has stories of “awful” meetings with “arrogant” venture capitalists, who were unprepared, did not listen, and seemed unfairly critical (if not dismissive). There are of course, two sides to this – every entrepreneur believes that their plan is inherently sound, they deserve to be funded, and they expect to succeed. It is unfortunate that, too often, skepticism can come across as arrogance.
And, in truth, our job is not to criticize but to help create. Like the cold-blooded critic, Anton Ego, in Disney’s Ratatouille, the venture capitalist actually has a responsibility to discover and defend “the new.” While it may seem far-fetched to connect a kid’s movie about a rat who can cook to the technology venture business, I think the quote above captures perfectly the issues we face. Some of the most important work we do as investors is to identify those things that are truly new that we should help. Indeed I think we have a duty to help certain entrepreneurs and companies, simply by virtue of our position in the market.
This does not mean that we should let idealism override our responsibilities to make money for our Limited Partners. Nor should we support visionary companies that don’t have a reasonable chance of being successful. But for those few, truly great, new ideas that deserve to succeed, we have a duty to support them – to fund them (if we can) and to help them succeed in the face of the world’s skepticism. As Anton Ego thoughtfully concluded, “The new needs friends.”
Will Porteous 