I've been pointing out for more than 20 years that so many portfolio failures are a direct and ineluctable consequence of a fundamentally broken model. In the old days, VCs (for all their many faults) had at least started or run companies or divisions. They had a grasp of reality. Today's VCs are mostly boys & girls who emerged from MBA school without ever having done anything; thus they live on hype, follow the herd ("if every other firm is investing in X-type companies we'd better invest in an X-type company too!"), and seem oblivious to the fact that they have almost no ability to understand what they are doing. It's like Hollywood: no one has a clue. And like Hollywood, the dream is that the occasional blockbuster will cover the costs of the myriad failures. It's a broken model and ensures that hype-oriented companies will be funded while potentially great companies will be ignored "because they don't fit the (illusory) hockey-stick model."

Anyone who enjoys my articles here on Medium may be interested in my books Why Democracy Failed and The Praying Ape, both available from Amazon.

Anyone who enjoys my articles here on Medium may be interested in my books Why Democracy Failed and The Praying Ape, both available from Amazon.