i might quibble with your definition of “flip”. *every* VC investment is designed to flip. no VC investment is meant to be held for the true long term.

and in my previous comment i said founders need to recognize they are signing up for 5-10 year endeavors. *not* for quick results

finally, i too respect and admire “big bold bets.” i just worry that its too simplistic to view “big bold bets” as only massive technology projects

Newman's Own and Ben & Jerry's were “big bold bets” – that consumers wanted their same old same old products, but in a more authentic artisanal organic way

Zappo's was a big bold bet that consumers would buy shoes online (previously shoes were considered not right for ecommerce as people needed to try them on)

Agamatrix is/was a big bold bet (and is a big bold success) that a small incremental improvement in the algorithm used by blood glucose monitors to test blood would massively improve peoples lives

Twitter is/was a big bold bet on consumer demand for a simple communications utility. No rocket science there, just brilliant simple concept and solid continuing brilliant execution

etc

Also, from a broader, societal perspective, I like it when VCs/entrepreneurs make big bold bets. A new search engine, electric car, etc. And this stuff requires capital.

but that doesn't mean i don't think he's sometimes guilty of selective memory, at best, and pomposity and self-aggrandizement at worst

and that quyote ranks with the worst

and it doesn't matter what we think he “meant” — actually we have no idea

all we can judge is what he actually said. which you quoted

and which *is* baloney — intel *did* have an exit strategy. and intel's investors got an exit. after only three years, through share sales to public market buyers (versus share sales in an M&A scenario.)

for me, thats a distinction without a difference

also, chris — how many VC's consider an IPO an exit strategy?

i humbly submit: they *all* do.

thing is, i love all the openness and counsel to young entrepreneurs and startups on the blogosphere (wish it was around when i needed it, back ion the jurassic er!)

and you, chris, are amongst the best of the best

but i don't understand why one can't ask for a little less giddy euphoria and blowing of VC-investor-oriented sunshine up people's rear ends?

telling entrepreneurs to look always to the stars is not uniformly good advice.

thats just the truth.

it may make sense from a VCs point of view– VCs, after all, manage large portfolios of diversified startup investments, and over long periods of time, and can only justify their humungous fees by promising humungous returns, which are in turn only available if startups only swing for grand slam home runs. ok.

but founders and entrepreneurs do not manage portfolios of diversified risks.

no, they lash themselves to the wheel of one, and only one, highly risky endeavor, for low low “subsistence” pay, and for a long period of time. so there is nothing nothing nothing wrong with focusing on exit strategies.

in fact, its the only sane and rational thing to do.

my $0.02

One of my favorite Jeff Bezos sayings is “After you plant a seed, you don't dig it up every day to see how it's doing.” (He also loves to mention the voting vs. weighing machine metaphor and “You're not 20% smarter when the stock goes up 20%, just like you're not 20% dumber when it goes down 20%.”) Real investments built on strong fundamentals are long term investments. In Jeff's mind, that's a minimum of 7 years.

Seven years is a long time, and I think some entrepreneurs feel pressure to flip and get rich quick because that's what happened in the late 90s and that's what VCs want. Conversely, consider the condemnation on those whose companies get labelled as “lifestyle businesses”. Thankfully, the idea of becoming cash flow positive first and scaling later is starting to become more accepted, a trend I hope continues.

and i totally agree startup founders need to think longterm — they are very likely to toil at their “newco” for 5-10 years, almost never a quick results type endeavor or commitment.

but andy grove's quote (which is dragged out so often is getting threadbare) is 100% self-serving (for Grove) bullshit: intel had an exit strategy — they did a public offering in 1971 — only three years after the company was founded!

The term “empire” is a great one. We refer to our market as the “bigger ecosystem,” because there are multiple players, transaction points and systems at play. I may borrow “empire” from you though, because that's what we plan to build – a lasting business, dominant in the food chain.

You say that the peak of the cycle was '07-08, so do you think we're still in decline, or have we hit the nadir yet? Further, I don't think it's terrible to start with a lower valuation early on – doesn't that leave room to better build up your valuation as the economy recovers?

Finally, it's the entrepreneurs who want to build “empires” who are going to lead the way in turning the cycle, and they'll do this regardless of the current conditions. We're raising capital right now – bad timing – but we know we're going to be successful anyway.

I once heard Santo Politi (Spark Capital) say (something to the effect of) “the best entrepreneurs are such a force of nature that they are going to get it done no matter what.” Brings us back to the ecosystem, and being the force of nature within it.

So what the hell? just do it. honestly no one really knows what a good period is. I personally can't figure it out yet.