“One of the strategic tasks of an innovator is to deter imitation for as long as possible. This applies not just to companies in established markets, but to startups that are creating new markets. Startups too must try to deter imitation,” writes Jerry Neumann, who happens to be one of my favorite thinkers. He is back with a new essay around moats, innovation, and competition. I would urge you to drop everything and read this piece.

The essence of venture business

Jerry Neumann, a venture capitalist who also teaches a course on entrepreneurship at Columbia University’s engineering school has outlined in great detail the history of venture capital during the 1980s. The treatise is a timeline of multiple boom-and-bust cycles that make up the every changing history of Silicon Valley. I, personally, have been part of many of these cycles. There were quite many cycles before the current one. And there will be cycles after the present cycle. Only difference, is that the speed with which cycles happen is much faster. However, some things have not changed — like the essence of venture capital business:

The pioneers of the 1960s and 1970s had figured out a winning formula: build a great network to source opportunities, spend months getting to know the management team and doing due diligence, invest at the earliest possible stage, work hard to help founders get the right team in place and put together partnerships, and take the company public only when it was ready to be a public company.