A VC in Vacationland

We had very different office perks when I was living in London and developing Andersen Consulting’s Supply Chain Consulting Group across Europe.  Coffee and biscuits delivered to you desk four times a day, a partner breakfast, lunch and dinner room with a private chef (unfortunately shared with Arthur Andersen’s partners), office supplies brought to your desk within minutes of a call, and the shoe shine guy. Those days are long gone, but it was nice while it lasted.

I got to thinking about the shoe shine guy the other day, after the third call from a newbie entrepreneur with another wild scheme to make money in the supply chain space.  The shoe shine guy showed up every day to shine your shoes. Free, but really paid for out of partner profits. Almost every day he had a new scheme to make money.

He was Russian, in the UK on some sort of work visa (the Brits don’t like to shine their own shoes). The whole glasnost thing was happening in Russian and he had a myriad of friends who had access to the "private" auctions of state companies, including a number of logistics companies.  I used to listen daily to his stories, his pleas for money to invest in all these sell offs , and most of all his desire to join his wife and kids back in mother Russia. I never went for any of his schemes as they all sounded too risky–such as suitcases full of dollars being the "currency" of the auctions. Last I heard, he had made it big in Russia after buying one of these public enterprises.

But I realized that he did have a big influence on my venture capital mindset.  His daily diet of new deals, some of them turning out to be very lucrative for him and his friends, made me realize that you never know where the next good deal may come from.  You have to keep looking among the unknowns to find interesting new ideas.  Their business models may be bad for the moment, but you know in your heart that the idea will work, and work big time, some day .

I have a couple of those deals percolating right now, one in the freight futures market and one in business networks.  When I first met the entrepreneurs, I knew the initial business models were wrong.  But I am continuing to help them refine the models, with the hope that we will get it right in the next few iterations. 

That’s what early stage venture capital is all about some days.  Listening to the shoe shine guy.