It's difficult to predict the future when innovation is the name of the game, says successful technology entrepreneur and venture capitalist Vinod Khosla. And it is.
But what does this have to do with early stage investing -- the state of play in Africa – and the whole wide world?
"Imagine what happens when the intelligence of 900 million people is unlocked, and the untapped reserves of a continent's innovation flow freely. Building the developed world as we know it required linking speculative capital to people with brilliant, unproven ideas. Africa is home to untold numbers of people harboring spectacular ideas, yet the continent and indeed, the world, reap far too little of what African innovation could produce due to a lack of investment in its entrepreneurs."
- Creativity and innovation – are they such a big deal?
- And if their results are hard to predict, how will they get funded?
It looks as though early stage investment may hold a key.
But let's get back to Khosla. Khosla can back up his assertion about predicting the future with a delicious array of remarks, including "The telephone has too many shortcomings to be seriously considered as a means of communication" (Western Union Internal Memo, 1876), Lord Kelvin's "Heavier-than-air flying machines are impossible" (1895), Thomas Watson Sr.'s idea that "five or six computers" would be enough to satisfy world need, or DEC founder Ken Olsen's inability to see why anyone would want a computer in their home…
No wonder Khosla quotes Karl Marx to the effect that "when the train of history hits a curve, the intellectuals fall off " – and it's not just scholars he's talking about, it's pundits, analysts, advisers, consultants…
He also quotes Alan Kay, "to predict the future, invent it" – George Bernard Shaw, "All progress depends on the unreasonable man" -- and Martin Luther King, "Human salvation lies in the hands of the creatively maladjusted" – so what have we learned?
Forget Brett Shere's 900 million people for a moment, and think of one sub-population among them -- the fraction of 900 million people who are "creatively maladjusted"...
- what does it take to empower them?
- and where are we falling short?
"The existence of a major gap in the financial markets of the world's second most populous continent is a serious problem: seed and early stage investment are major drivers of any robust entrepreneurial economy, and entrepreneurship is the most important force for sustainable job creation in the world," Shere writes – and "while Africa has an active microfinance space and emerging mid-size private equity sector, there is a gaping 'missing middle' in Africa's capital markets that includes seed stage angel investment and early stage venture capital."
- Why is early stage investment so crucial?
- Why is it so easily overlooked?
- Do you have to be "creatively maladjusted" to make early stage investments?
- foolish?
- courageous?
- a creative risk taker?
- Is there even a difference?
The Japanese came up with 17-character messaging – haiku – in the mid seventeenth century, and over the years it became hugely popular as an art form. But social networking with 140 characters, on the scale of Twitter? Matsuo Basho, the 17th Century Japanese haiku master, didn't see it coming! 200 million users in five short years! 200 million tweets a day!
Khosla asks, "Could McKinsey or an analyst have predicted Twitter?" -- or for that matter, the fall of the Berlin wall, or the Arab Spring? Here are my questions:
- What are we missing?
- How important will that be, a short five years from now?
- Will you do something about that?
- Who are we missing?
- Are you talking with them?
- Why not?
- What tools do you have?
- Who else will do this, if you don't?
- OK --what will you do?
No comments:
Post a Comment