Georges van Hoegaerden: Harsh Critic of VCs (RWS Interview)

Willing to Go on Record to Criticize VCsRaising VC cash in future might become harder.They are predisposed to the view that critics are sore losers, whose ventures were simply not good enough to get VC funding.Listen to the InterviewWhat Did We Ask Georges?Question #1: You have been openly critical of VCs. Not many people are willing to do that. Why are you willing, and what do you hope to achieve by it?Question #2: What are the three most obvious signs that you are dealing with a bad VC and should avoid it. Conversely, what are the signs of a good one (other than it writes large checks)?Question #3: How is the VC model changing (specifically for Web tech, rather than clean tech or bio tech), and how can entrepreneurs leverage these changes?The Venture Eco-SystemThe entrepreneur. He believes that too many VCs pay lip service to the idea that the entrepreneur is the one who creates value. These VCs believe their role as intermediary between the Limited Partners and entrepreneur makes them the important player. You can usually tell them by their rude behavior.The Limited Partner (LP). As an entrepreneur, you don't hear much of LPs. They are the folks who put money into VC funds. They can be institutions (for example, a pension fund that invests your money) or rich individuals. If they do not get good returns from VCs as an asset class, they will put their money in other asset classes, and that would be very damaging to everybody in the technology innovation business.The General Partners who run VC funds. They are the intermediaries who get paid "2 and 20" (2% of funds under management, and 20% of the profits generated from investments). As intermediaries, they have to add value. The fundamental point Georges is making is that both entrepreneurs and LPs are questioning the value added by VC fund managers.Macro-Economic AdvantageLook at Apple as Entrepreneur + VC Listen to the InterviewDiscuss