A venture capitalist and Facebook
Reflecting on Facebook’s early days. Larry Cheng was the Boston venture capitalist who was likely the first to discover TheFacebook.com - at the time, a fledgling website in a Harvard dorm. The firm he was with, Battery Ventures, chose not to invest. Last week, Cheng looked back at his meetings with Facebook cofounders Mark Zuckerberg and Eduardo Saverin. (Saverin didn’t stay with the company.)
After the session [in Battery’s Waltham offices, where Cheng explained the mechanics of venture capital investments], Mark and Eduardo informed me that they had no transportation home and they had taken a cab to come visit me. Feeling guilty that it never occurred to me that they didn’t have a car, I drove them home myself and paid for their cab fare. We had a nice conversation on the way home. We talked about Eduardo’s girlfriend at Wellesley, who he was clearly infatuated with. We talked with Mark about the Bay Area and moving to California, which he was enthusiastic about. And, after the quick drive down the Mass Pike, we took the Cambridge/Allston exit, looped back towards Harvard and I dropped Mark and Eduardo off at Johnston Gate, the main entrance to Harvard Yard.
That was the last time I saw either Mark or Eduardo because an investment ultimately did not work out. Since then, Mark has obviously gone on to change the world - just as he expected to. Mark has accomplished everything he said he would and more. But, when I think back on this experience, a big part of me wonders what happened to Eduardo. I’ve heard about the break-up with Mark early on, which makes me wonder what happened behind the scenes. I wonder how Eduardo was treated in the whole process. When people tell the Facebook story now, it seems like Eduardo gets deleted from many versions and included in some. But, from my vantage point, Facebook will always be about Mark and Eduardo. No matter what is written out there, I’ll always believe that Eduardo Saverin is a cofounder of Facebook.
Insights from an angel. What should entrepreneurs know about the mindset and motivations of individual investors - often called angels - who bankroll their companies? Dharmesh Shah, a local angel and cofounder of the Cambridge marketing company HubSpot Inc., listed “10 Things an Angel Investor Will Never Say.’’ Why are there 11 things on Shah’s list? Perhaps because angel investors always have just one more bit of advice.
1. I really want to support entrepreneurs - but just those that are going to make me money.
2. I dread having to explain your business idea to my spouse (who can veto any deal).
3. I don’t really have enough [of a] stake in your company to spam my network on your behalf.
4. I was lying when I said that some of my best friends were VCs. Even VCs aren’t best friends with VCs.
5. I have no idea what you’re talking about 50 percent of the time. What’s a socially-semantic mobile platform for nonvirtual currency mean? (Oh, it’s an iPhone/Facebook payment app).
6. The other 50 percent of the time, you have no idea what you’re talking about. Anti-dilution provisions in a term sheet are not about beer.
7. How the public market did last week does impact my decision-making.
8. I like to invest in cool start-ups because it helps make up for high school.
9. I don’t understand what half the things in the funding agreement mean either, but I’m betting that most of them are to protect me, not you.
10. I really didn’t put the check in the mail the day I said I did. I was golfing that day.
11. I’m in it to mostly have fun. If I wanted to do unpleasant work, I’d have my own start-up.
onstartups.com
Have you seen an interesting item on a local business blog? E-mail kirsner@pobox.com. 
