The latest Bill Gurley column is about demand driven capitalism. Basically, what he's saying is that companies used to be created because there was an obvious and known need in the marketplace. Today they're often created because someone has an idea and a gut feeling it will be huge. He's suggesting that investors return to only funding companies that already have a market established. I understand what he's saying, but there are a few problems with this. First off, he's funded a number of companies that are not like this at all (though maybe that's the problem). Second, the whole point of venture capital is that it's "risk capital" which is supposed to help jumpstart these early stage companies that don't necessarily have the funds to build the product that meets a market need. I understand that VCs need to be more choosey and look for companies that have real value, but only funding companies in established markets misses the entire point.
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