After reading Mark Suster’s blog post where he mentioned the book eBoys: The First Inside Account of Venture Capitalists at Work, I new I had to read it right away. Well, I just finished the book and I highly recommend it for anyone interested in learning about the go-go Internet dot com days of the late 1990s, venture capitalists, or entrepreneurs looking to raise venture capital. The book details the formation of Benchmark Capital, started in 1995, and chronicles their inner working, investments, successes, and failures in the late 1990s. Here are a few of my takeaways:
- Benchmark pioneered the concept of having equal partners (no junior or non-general partners), no associates, and limiting themselves to eight boards instead of the usual 12, so as to have more time for entrepreneurs
- Benchmark made the single best VC investment of all time by investing $6 million into eBay, at a $40 million valuation, which was the only money eBay raised, and resulted in a 100,000% return on investment (eBay is worth $30 billion today)
- Benchmark had the opportunity to invest in Priceline.com at an $80 million valuation, but deemed it to expensive (Priceline.com then IPO’d and shot to a value of $20 billion, before crashing many years ago and has now risen to a value of $8.6 billion today)
Again, if you’re interested in venture capital or are an entrepreneur raising money from venture capitalists, I’d recommend reading the book.