Inside the Real World of Venture Capitalists – Part 1 of 9

Two years ago a good, trusted friend, a lawyer, came to me with a technology patent that his firm Swing Trading; A Scientific Approach had become involved with. The patented technology provides high-speed Internet access (broadband) to homes and businesses over electric power lines. Some 50 percent of American homes and small businesses, mostly in rural areas, do NOT have high-speed, low-cost Internet access, but nearly all are wired for electricity.

The basic idea looked like a win-win situation for everyone: underserved consumers; the utility companies whose lines we would pay to use; and, not least, the entrepreneurs and venture capital investors whom the financial model suggested would reap great returns within three years. My friend asked if I would consider being the chief executive officer of the start-up company that would take this technology worldwide.

I was then the chief information officer of McKesson, a San Francisco-based health care services company that is one of the 20 largest corporations in the United States. I managed an annual budget of $500 million. Thousands of people reported to me. I had led two successful start-up subsidiaries within companies where I’d been a senior executive. I’d been a “techie” for 25 years and considered myself very, very good at it. But should I take the risk 60 Minute Trader™ of leaving McKesson to head a completely independent start-up?

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