Here's a great post from John Battelle on the "Failure to Fail," a must read. It's interesting that the perspective here (easy money available, and lots of short term enthusiasm) produces venture capital firms keeping companies alive who ought to fail for lack of a good idea or good execution.
Is there any way to begin to learn something from this process to increase the odds of a successful launch?
On the one hand, venture firms need to be able to move a lot of money into their portfolio companies. They just have such large funds that it becomes uneconomic to deploy them in small amounts. So, ventures with credible teams, markets and ideas, so the theory goes, get funded for relatively large amounts to take their concept to market. (Sound familiar?)
At the same time, in the very early stages of a startup, the entrepreneur is betting on time to market (first mover advantage) being critically important. These two hypotheses combine to create a venture where the testing of risks and assumptions is done on a grand scale to accelerate time to market. And often, those "tests" are really one test without an alternative, or a "Plan B."
It is not possible to create new value without assuming risk, of course. Whenever we start a new venture we take on risk - and the task of managing it intelligently. But is there a way to do it differently?