Sunday, June 15, 2008

Venture Capital, Before High Tech

Highlights from an
interesting piece in New York Times.

THE United States military — credited with spawning the Internet — also helped in the genesis of venture capital. So reveals Spencer E. Ante in “Creative Capital” (Harvard Business School Press, $35), a sometimes slow but ultimately satisfying biography of Georges F. Doriot, the transplanted Frenchman who is often called the father of V.C. Doriot, a United States Army reserve officer who rose to brigadier general, was appointed an administrator - entrepreneur on the home front, responsible for equipping, clothing and feeding millions of soldiers overseas. He and his staff, including many of his students from Harvard, funded research into innovative solutions. A lightweight plastic flak jacket (the Doron) saved thousands of lives. And even some failures had their upsides. Grunts found their powdered lemonade “useful as stove cleaner or hair rinse.”

The book’s matter-of-fact storytelling is not always as superb as the story, but as the book advances it gathers poignancy. Doriot had won the hand of his Harvard-assigned research assistant, Edna Blanche Allen, a brainy beauty. Their 48-year marriage was childless; Harvard men were surrogate sons. Edna had a dream house built for the couple on the Massachusetts shore, then died of lymphoma; her ashes were scattered into the ocean. Doriot kept writing her love poems. Nine years later, in 1987, the pipe-smoking general succumbed to lung cancer. His ashes were cast from the same spot into the Atlantic. DORIOT’S charismatic, French-accented lectures at Harvard over 40 years inspired multiple generations of leaders with firsthand stories and pithy sayings — for example, “Someone somewhere is making a product that will make your product obsolete.” His cause, venture, became ubiquitous, even in philanthropy.

“Someone somewhere is making a product that will make your product obsolete.” - Georges F. Doriot