What Would it Look Like if Elon Musk Pitched a VC Today?

Posted on May 30, 2013 | 18 comments


This week I attended the All Things D Conference in Ranchos Palos Verdes. It is always a stellar event.

The good and great of the tech industry were there: Tim Cook, Sheryl Sandberg, Dick Costolo, Max Levchin, etc.

But Elon Musk stole the show.

I thought Michael Lazerow’s Tweet best captured the mood of the crowd

Screen Shot 2013-05-30 at 10.09.12 AM

I’m sure you know, but Elon was the co-founder (and largest shareholder) of PayPal, the most important payment transfer technology of its era and still the most instrumental to date. He said he wanted to found this company (he had founded a previous company that sold for about $300 million) because he thought the Internet was a big idea.

He was interested in a few other big ideas. Energy independence (so he founded Tesla and Solar City). And space travel (SpaceX). His goal in the second project is to help humans avoid extinction.

I have never sat in a room with an individual where I felt more inspired and humbled. I think the zeitgeist in the room was that we were seeing the successor to Steve Jobs in terms of inspiring us to think big.

And when asked who has inspired him he of course gave a nod to Nikola Tesla.

This made my friend Dorrian Porter‘s KickStarter initiative to create a statue of Tesla in Silicon Valley even more poignant. I hope you’ll consider clicking that link and making even a small KickStarter contribution to support arts & innovation.

For my part I will participate in the unveiling of the statue in November and make myself available to meet with any contributors to the project as outlined by Dorrian.

Dorrian is someone I’ve known for years. He is the close friend of my dear friend and college roommate, Stefan Kennedy, who is also a luddite and therefore will never read this ;-) Yes. He is that .0001% who still doesn’t use Facebook, Twitter, Instagram or any other social technology.

Dorrian is an entrepreneur. He has been through the journey you are going through and we have spent much time sharing stories from when I was in the trenches, too. He knew me then.

His imagination of what is wrong with VC has captured perfectly in satirical format what ails our industry.

If you haven’t watched the video, please do. It is Nikolas Tesla pitching a VC firm. And if you haven’t it, I must tell you it is an absolutely perfect caricature of the worst sides of our business.

He has now created Part II.

It is also very funny but please watch Part I first.

They are also sad. Because the videos show exactly what life would be like if a young Elon Musk came to pitch VCs today and said I want to transform P2P finance, get people driving electric cars and send a man to mars in our lifetime.

At D Elon said he worried that our most talented entrepreneurs these days were too small minded in their objectives. Obviously that claim can be placed with VCs, too.

Dorrian created the videos solely to create awareness for the Nikola Tesla statue project as a public good.

Given how awesome the videos are and how worthy and selfless his goals are I’m going to break my usual rule. I’ve never had a guest post before (other than from my fabulous wife here & here – some of my best read posts ;-))

But this one is for Dorrian. And his Tesla Statue project.

The reference to Andy Dunn and me is responding to this post I wrote (in response to Andy’s earlier post).

The back-and-forth between Andy & me if anything I hope just raised the issue a bit more about entrepreneur & VC relationships. I don’t have any issues with Andy – he’s always come across as a very nice and sincere guy. Debate helps everybody learn as I wrote about here. Let’s never stop debating important topics.

*************

The moral compass in all of us

by Dorrian Porter

The first time I met Andy Dunn he was working for the venture capital firm Maveron.  The first time I met Mark Suster he was the founder and CEO of a company called BuildOnline.

We’ve come a long way.   In fairness to Andy he was complaining at the time about his beige pants – especially the fit – and his button down blue collar shirt.  In fairness to Mark he was getting tired of sleeping under his desk and doing whatever it took to make sure payroll would be met every two weeks.

One thing I know about that role reversal – and everything I’ve learned since coming to the Silicon Valley – is that it is impossible to label an individual and much easier to label the group.  Yet no matter what side of the table you sit on within the technology community you are going to be faced with very similar situations that test your moral compass.  It really doesn’t matter if you are playing the role of a VC, entrepreneur, inventor, CEO, executive, developer or any other position at any company at which you work.

I published a video 10 days ago called “Nikola Tesla Pitches VC” and I’m itching to do a full episode as evidenced by the trailer we released today:

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After watching both videos many people have said “Boy you must have had a bad experience with VCs”, and the answer is a flat no.  As a founder or CEO over 13 years I raised $35 million, sat on boards with 7 different venture capitalists and I’m in touch with every one of them today.   The sad reality of the videos is that there isn’t one bad quality displayed where I don’t see at least a glimpse of my own bad behavior at one time or another over the last 13 years.

Is it true that VCs sometimes are thinking about short term wealth potential instead of long-term innovation even with the benefit of long term profits?  Is it true that CEOs or founders often do the same?

Is it true that VCs sometimes hire the wrong CEOs for all the wrong reasons or make false assumptions about a founder’s ability?  Is it true that CEOs or manager often do the same with an employee?
Have you ever checked your cell phone when you’ve got a human being in front of you, telling you something they think is really important and you don’t?

Did you ever suddenly get more interested in a conversation when someone you didn’t initially think was relevant to your immediate business goals turned out to be?

Our collective future will always depend on the decency of individual action and intention.  Since other people’s intentions are impossible to know, your fiercest subject of criticism should be you since we all know that we lie to ourselves a lot more than we do to anyone else.  You’d better at least be honest about that.  As I once said to my friend at the blackjack table when asked how much I was down:  “Do you want the lie I tell you, the lie I tell my wife or the lie I tell myself”.

I launched the project to build a statue of Nikola Tesla  — and to present Nikola Tesla as the quintessential inventor in the cartoons — to inspire the entrepreneur in everyone to think big about the things that really matter.

We need more inventions that will solve global problems. That’s why Elon Musk was such a big hit at D11 yesterday – speaking in terms of humanity’s biggest issues and encouraging entrepreneurs to do something different than the Internet.

We need more people to value long term innovation over short term profit. That’s why Om elegantly pointed out that the first Tesla cartoon might be saying something bigger about the state of the Silicon Valley today.  You can back the Tesla Statue project to join me and Mark at the statue unveiling in November.   VC or entrepreneur, we need to all stand up for creativity, innovation and the moral compass within all of us.

  • http://about.me/lord_nolan Nolan Clemmons

    Some of us are trying to do great things. But we’re not telling people what they want to hear. Some investors think that just because they have the money (or someone else’s) that their decisions are always right. Investors can be either old, or bold.

    “How much have you already raised?”
    “What has been built so far?”
    “Sorry, not enough traction”

    The fact is, only some of their investments will be a win. But how many of those did they think would win? All of them? That’s over-confidence. The problems is that some of their losses are those that they didn’t expect to lose. How often will someone invest in something that they think will lose, but ends up winning? Most would never risk money like that if they though of it that. They’d rationalize so that it seems like a good bet (“Oh he founded X” or “Larry’s also in on this deal”) That’s something we need to see more of in the future, investors accepting the fact that their process is flawed.

    Crowdfunding (equity-based) will help. It will transform the funding climate from an oligarchy (powerful few) to a democracy. It’s a win-win for both entrepreneurs and those that fund them (and aren’t millionaires). At $100 a share, you could spend that much on cigarettes or soda in a month (or gas if you haven’t bought a Nissan Leaf yet). And entrepreneurs get the money that they need.

  • http://www.playbasis.com/ robzepeda

    Thank you both for creating awareness about some very important topics. It seems as though entrepreneurs aren’t allowed to think big until they’ve proven they can exit something “smaller” doesn’t it? And are there any examples of thinking big that don’t include hardware?

  • Kelly Day

    Mark – these videos are hilarious, although sadly too true. I would love to try and fund Dorrian’s full episode. If he is interested, I would appreciate you putting us in touch. thx! Kelly

  • http://about.me/YaronSamid Yaron Samid

    I’m man-crushing on so many of the bad asses in this post. Thanks Mark and Dorrian for keeping the conversion and inspiration flowing.

  • http://blog.ideatransplant.com Jan Schultink

    Mark, you might be in a position to write the script for the opposite video as well: entrepreneurs from the VC perspective :-)

  • http://yallaguy.com aarondelcohen

    This is a top 10 moment in industry clarity. Dorrian that video is absolutely spectacular. Script is pitch perfect. My only issue is the project is too small. We should have a Tesla statue in every city in the world erected with 3d printers. This should be the beginning of something far beyond a statue in the valley. This effort can be a signature moment in #nethistory

  • Lee Cooper

    Thought provoking and inspiring in the same breath. Thank you! What both you and Dorrian say says so much about not just business but the wider world in which we live. The world of Now! Patience and thought is no longer a virtue. Everything is about doing and action that will effect a result today, tomorrow, this month or maybe this quarter.

    Quick bucks are order of the day. It’s a (western) cultural issue. Until we start to value the long game much of the behaviours that took the global economy to its knees will sadly prevail. Memories are notoriously short, the lessons of history rarely learned.

    However I remain optimistic and my glass very much half full that those such as you and Dorrian, with voices that are heard and listened to, have the courage to speak loud and encourage us all to consider a change that will benefit the many as opposed to the few. I applaud you.

  • Omega Lee

    Love it! Motivational! When others can’t believe or see your vision. You only need a market of one.

  • Dennis Conner

    I appreciate the desire and intention to do good work, treat others with respect and promote honesty and accuracy in the moment. Most of us understand that at the end of the day global businesses new and old, small and large will migrate towards their own self interest.

    The conflict created by the tension between meeting the needs of the invested, supporting the greater good of the whole and respecting the needs of the individual often degrades innovation while perpetuating the worst tendencies of humanity.

    Solving this issue is at the heart of what Dorrian discusses and I applaud his efforts and honesty. I wish I could support efforts to perpetuate humanity throughout the Universe. However if we are truly looking at the world honestly and putting what matters most first, we would have to accept the reality that on the whole we have done more harm to nature and all other living entities than good.

  • http://x.co/gmglobal +++++ My Global Website +++++

    -
    VCs don’t like risks, they want to invest ONLY in Google-like companies to earn hundreds times the money invested

  • Josh Stein

    +1 to Elon being the most inspiring entrepreneur of our generation. The breadth of his accomplishments, across multiple industries is simply staggering.

    As to his relationships with VCs, I’m very proud that my partners here at DFJ have been able to back Elon in all three of his most recent endeavors: Tesla, SpaceX and SolarCity.

  • matteocassese

    As capital, ideas and technology are becoming easier to access I start to see those celebrity entrepreneurs more as evil puppets than inspiring figures. Do we really have to look in awe at Sergey and Elon, do we really need another Jobs? Maybe the Jobs fenomenon could represent the last time we were collectively fooled into buying an ecosystem, a big stack that benefits only one company. Our mindshare is limited but I feel that smaller examples of entrepreurship do the industry much more good than those figures.

  • http://www.kineplay.com/ben Ben Milstead

    Love this: “Our collective future will always depend on the decency of individual action and intention.” So well said. Love the project. I wish the videos didn’t ring as true.

  • http://www.esayas.com/ Esayas Gebremedhin

    It’s an interesting video showing how many entrepreneurs feel about the VC business. I had published something similar almost one month before the youtube clip. I called it: The Startup Paradigma-Shift: http://esayas.com/post/48862546655

  • RandomMan

    “I have never sat in a room with an individual where I felt more inspired and humbled. I think the zeitgeist in the room was that we were seeing the successor to Steve Jobs in terms of inspiring us to think big.”

    Gack. Elon Musk is a visionary. What was Steve Jobs’ vision? (Wanting to own everything doesn’t count as a vision.)

  • Peter

    We already knew that most of these “General Partners” are immature college boys not much older than many of the “founders”. All they can do is fund the 357th AirBnB and even that one doesn’t make money.

    Although the VC industry is already shrinking (the upside of it being that it will bring out the best and while the frat boys can go look for a real job), wait until interest rates go up and pension fund managers stop investing in the low-yield VC asset class and rather buy high yield bonds.

  • http://twitter.com/markusvonroder Markus Roder

    No.
    Smaller entrepreneurship will not get us off of fossil fuels, nor will it get us off the planet. Only massive vision can do that, and massive vision comes with the need for (potentially) massive payoff.

    With Musk you can even see that the money is a means to realize the vision, not the vision a means to make more money.

  • http://twitter.com/markusvonroder Markus Roder

    How about “Making the world a more beautiful place with massively elegant User Experiences”? Owning was a “has to happen”, to control the aesthetic experience.