Question
Can an entrepreneur create his own destiny or is it the VC who draws the path for him?
Answer
John Greathouse has provided the idealist answer, which is great for keeping yourself motivated.
It also helps to maintain a much more pragmatic view alive in parallel: it is entirely a situational state depending on the individual entrepreneur and VC in question, and the stakes/potential value/payoff of each, and the interpersonal relationship between them.
In the best case, you can get all those positive a, b, c, d rosy relationships John listed, which are the stuff of great student-mentor movies. In the worst case, you can get a zero sum game which will be won by the smarter, tougher person who has more stakes and/or is a better negotiator at a given time.
The smart approach is to realize that for all the idealist rhetoric on both sides, you have two flawed human beings with imperfectly aligned interests operating in less-than-ideal situations. The miracle is that this entirely flawed system can actually produce real value.
I've met both successful and unsuccessful entrepreneurs who've privately shared war stories that are not quite the idealist fairy-tale. Cases where things ended with extreme bad blood, where one or the other side felt cheated.
An entrepreneur friend offered this opinion, at least for Web startups, which rings true: entrepreneurs are the over-performing clueless types, while the VCs are the sociopaths (the terms are based on an article of mine, http://bit.ly/a8E8wV and a cartoon by Hugh MacLeod).
The situation is loaded in favor of VCs simply because the VCs hold a more powerful hand: they have more experience, have seen more trajectories of companies, usually own enough to control the board, and have a risk-hedged position through multiple investments where the entrepreneur typically has all eggs in one basket. Which is why even in the case of a conflict between a poster-boy CEO of a successful company like Zappos, and the VC-controlled board, the board had its way (the sale to Amazon, which Hsieh describes in his book "Delivering Happiness").
So to balance out John's choices above, I'd offer:
e. Gold rush saloon/general store operators and prospectors in the gold rush
f. Casino managers and addicted gamblers
g. Baby-candy-stealer and baby
And yeah...you may bravely decide "not to sacrifice your vision to market vagaries" but market vagaries have a way of not respecting your superhuman (and rather New Agey) commitment, and destroying things anyway. Try talking to both failed and successful entrepreneurs, not just the latter, to get a sense of respect for the market, which is more powerful than either VC or entrepreneur. Both successes/failures have their biases (one will take too much credit, the other will pass on too much blame) but there are things to learn from both.
Anyone can be a rosy-eyed idealist and stick to a pure and uncompromising mission/vision and a "we shall overcome" attitude to the uncertainties of the market based on a kumbaya vision of an ideal VC-entrepreneur relationship modeled on Miagi-Karate-Kid.
Anybody can be a cynical jerk of an opportunist, and callously kill the golden goose with no thought for others when there is a chance to exit with a "steal" of a deal based on a temporary situational advantage.
A true entrepreneur is someone who can balance the idealism and pragmatism in thoughtful ways. Who isn't stupid about real cost/benefit calculations, but is willing to trust (but verify). Somebody who is willing to try and accomplish something that goes beyond everybody's petty, flawed individual human concerns, something bigger than themselves. But at the same time isn't stupidly persistent when it is clear things are going nowhere.
It also helps to maintain a much more pragmatic view alive in parallel: it is entirely a situational state depending on the individual entrepreneur and VC in question, and the stakes/potential value/payoff of each, and the interpersonal relationship between them.
In the best case, you can get all those positive a, b, c, d rosy relationships John listed, which are the stuff of great student-mentor movies. In the worst case, you can get a zero sum game which will be won by the smarter, tougher person who has more stakes and/or is a better negotiator at a given time.
The smart approach is to realize that for all the idealist rhetoric on both sides, you have two flawed human beings with imperfectly aligned interests operating in less-than-ideal situations. The miracle is that this entirely flawed system can actually produce real value.
I've met both successful and unsuccessful entrepreneurs who've privately shared war stories that are not quite the idealist fairy-tale. Cases where things ended with extreme bad blood, where one or the other side felt cheated.
An entrepreneur friend offered this opinion, at least for Web startups, which rings true: entrepreneurs are the over-performing clueless types, while the VCs are the sociopaths (the terms are based on an article of mine, http://bit.ly/a8E8wV and a cartoon by Hugh MacLeod).
The situation is loaded in favor of VCs simply because the VCs hold a more powerful hand: they have more experience, have seen more trajectories of companies, usually own enough to control the board, and have a risk-hedged position through multiple investments where the entrepreneur typically has all eggs in one basket. Which is why even in the case of a conflict between a poster-boy CEO of a successful company like Zappos, and the VC-controlled board, the board had its way (the sale to Amazon, which Hsieh describes in his book "Delivering Happiness").
So to balance out John's choices above, I'd offer:
e. Gold rush saloon/general store operators and prospectors in the gold rush
f. Casino managers and addicted gamblers
g. Baby-candy-stealer and baby
And yeah...you may bravely decide "not to sacrifice your vision to market vagaries" but market vagaries have a way of not respecting your superhuman (and rather New Agey) commitment, and destroying things anyway. Try talking to both failed and successful entrepreneurs, not just the latter, to get a sense of respect for the market, which is more powerful than either VC or entrepreneur. Both successes/failures have their biases (one will take too much credit, the other will pass on too much blame) but there are things to learn from both.
Anyone can be a rosy-eyed idealist and stick to a pure and uncompromising mission/vision and a "we shall overcome" attitude to the uncertainties of the market based on a kumbaya vision of an ideal VC-entrepreneur relationship modeled on Miagi-Karate-Kid.
Anybody can be a cynical jerk of an opportunist, and callously kill the golden goose with no thought for others when there is a chance to exit with a "steal" of a deal based on a temporary situational advantage.
A true entrepreneur is someone who can balance the idealism and pragmatism in thoughtful ways. Who isn't stupid about real cost/benefit calculations, but is willing to trust (but verify). Somebody who is willing to try and accomplish something that goes beyond everybody's petty, flawed individual human concerns, something bigger than themselves. But at the same time isn't stupidly persistent when it is clear things are going nowhere.