during the internet bubble, the VCs weren't interested in owning a company ... they were looking at how fast they could flip their investment via an IPO. It was get a percentage of something really lame-brain, unload it on the public, it goes belly-up ... and then repeat with the next one (since there was still a need for a solution ... jokes in the period about no interest in start-ups that actually showed positive cash flow).
So there is counter argument ... why bother with somebody that actually thinks they have something valuable and successful ... they just want something lame-brain but with enuf of a facade that doesn't go belly-up until after they unload on the public.
As an aside, there are "angel" investors that actually look for several hundred thousand. These tend to be in it for the longer term.
Frequently the 2-10mil were looking for something that they had control and was within 24months of IPO. Once they got the investment/control ... the whole focus was the packaging of the IPO (how fast and how much)
Now for real topic drift. The large corporate CSOs use to come out of gov. service having dealt with physical security issues. Not too long out of school ... I got paired with one such brand new corporate CSO (recently of gov. service) and got to run around talking about electronic/computer related assurance/integrity on and off for several months (i didn't view it particularly security specific ... it just was part of industrial strength, business critical data processing)
10-15yrs later ... when computer security was becoming more fashionable and they needed people to fill newly created "security" positions ... they tended to be the people that weren't needed/wanted for doing anything else.
there is some temptation to draw comparison between packaging of startups for IPOs during the internet bubble to the packaging of subprime mortgages as CDOs.
I've used the analogy of CDOs as subverting the "observe" in boyd's OODA-loop. past posts mentioning Boyd &/or OODA-loop
http://www.garlic.com/~lynn/subboyd.html#boyd
Milken had used CDOs two decades ago during the S&L crisis to obfuscate the mortgage values. Long winded decade old post also mentioning need for greater visibility into underlying value in CDO-like instruments
http://www.garlic.com/~lynn/aepay3.htm#riskm
Mortgage originators used to have some interest in the quality of mortgages ... since there revenue came from mortgage performance. Along came CDOs, and they could unload the mortgages w/o regard to the quality. Their only interest became how fast they could originate mortgages (w/o regard to quality) ... and their revenue purely became how fast they could they originate mortgages and unload as CDOs.
a couple recent references:
http://www.garlic.com/~lynn/2008g.html#4 CDOs subverting Boyd's OODA-loop
http://www.garlic.com/~lynn/aadsm28.htm#61 Is Basel 2 out...Basel 3 in?
http://www.garlic.com/~lynn/aadsm28.htm#66 Would the Basel Committee's announced enhancement of Basel II Framework and other steps have prevented the current global financial crisis had they been implemented years ago?
http://www.garlic.com/~lynn/aadsm28.htm#67 Would the Basel Committee's announced enhancement of Basel II Framework and other steps have prevented the current global financial crisis had they been implemented years ago?