The Power Law: Venture Capital and the Art of Disruption

A nice account of the complex dealings in Silicon Valley.How there was a kind of equality for the gifted and mostly highly qualified people that new projects needed. Some were also self-taught and had no formal qualifications, but had proved their talents. Looking after them was part of the process.He does not mention the bad treatment of those who were not particularly needed, like Amazon warehouse staff. The book also fails to give details of how the three basics - advanced electronics, the package-switching for the internet and the easy-to-use hyperlinks of the World Wide Web - were all pioneered by rather different people. And made with public money and no thought of profit, either for military research or particle physics at CERN, where Tim Berners-Lee invented the World Wide Web.Nor does he notice that the gigantic profits going to a few people have no clear benefit to the society as a whole. Allowing for a population increased by vast numbers of immigrants, the USA grew no faster after the changes begun by Reagan than it had before.But what it does say is interesting and informative. Some of the human stories have the same fascination as the early episodes of Dallas, or even The Sopranos.Definitely a book you need to read.

An excellent historical, eye-opening and well-written account of the rising influential role of VC in the US and globally. The book is easy to follow, well-structured and full of amusing anecdotes about the early days of Facebook, Google, Amazon etc before they became world-famous, and the VCs who helped to shape and build their future. A highly enjoyable book!

Starts well and finishes strongly. Long, but completing it is a rite of passage for sector newbies…much like reading The Prize by Daniel Yergin, says this pivoting energy guy.

Exceptionally researched and written in an engaging and appropriately humourous way. Would have liked deeper exploration of the VC fundraising. Highly recommended.

I have been working in the tech industry for 20 years and learned so much from this fantastic book. Mallaby entertains as much as he informs, bringing the characters he discusses to life with anecdotes and stories peppered throughout. As such, The Power Law is an excellent read, deftly explaining the fascinating history of Venture Capital. It's a must-read if you want to better understand how Silicon Valley became what it is today, what we can learn from that in the rest of the world, how VC has evolved, how Venture Capitalists think and why VC investing is so different from traditional finance, and the impact VC has had on society.

The amount of detail here is truly impressive. Extremely well written book and delivers exactly what it promises

This is a great read and a gripping account of how the Silicon Valley phenomenon developed - except for the last 20%! The hagiography of Sequoia that closes the book is very one-sided, full of inconsistencies and could have been written by their in-house PR - e.g. the Sequoia mantra to "risk the franchise constantly" is lauded (actually they did very little of that - it was mainly product extension to maximise AUM) while Kleiner Perkins, who really did bet the firm on cleantech, is dissed. As Churchill observed, the winners write the history, I guess. Similarly, Uber is described really as a car crash (no pun intended) but hey, the market cap is still over $65bn.But none of this should stop you devouring the first 80% which is excellent.

Some great stories about the greats of VC. Also explain quite clearly the power law in a lucid way filled with real life examples

Produto veio com manchas de tinta

Great read if you're interested in the history of VC investing and Silicone Valley.

This book is a tour de force, combining great stories with deep insight, informed by the academic literature and author's own considerable expertise, that does the best job I have seen explaining the various stages in VC and the nature of the unique contribution of VC to the entrepreneurial ecosystem. Absolute must read by all entrepreneurs, as well as policy makers and the larger public seeking to understand the dynamics behind disruptive innovation. Also brilliantly written

At the outset, Mallaby lays out two objectives for his book: (1) to explain the venture capital mindset, and (2) to evaluate its social impact (such as in creating meaningful products or ensuring diversity or better corporate governance). He succeeds in his first objective extremely well, covering the history of investments from its early days in companies such as Fairchild (that changed the history of the chip industry) to recent fiascos such as Theranos and WeWork, exploring investors’ changing mindset and approach through that journey. His treatment of the second objective is relatively superficial though, whether in his discussions on the creation of meaningful products or on the diversity in venture funds and their investment criteria or on corporate governance. However, we also get a bonus third objective from the book — the narration of several interesting “war stories” in companies ranging from Atari, Genentech and Intel, to Apple, Google and Facebook to more recent ones such as Uber.The power law occurs when the winners advance at an accelerating and exponential rate, rather than a linear one. The 80:20 rule such as the one where 20% of the population own 80% of the wealth is one example of this. The book covers the various phases of venture investments in detail, starting with those by rich entrepreneurs to early innovations such as pooled capital (from limited partners) and activism capital (where investors played a key role in choosing managers and strategies), the era of creation of networks and “coopetition” (co-operation and competition at the same time), the no-holds-barred growth-investing style perpetuated by Softbank’s Masayoshi Son in the late 1990s, structured angel investments by the likes of Y Combinator, a tilt in the balance towards founders brought about by companies such as Google and Facebook and finally, the return to activist investing in companies such as WeWork and Uber. The book covers the history in multiple geographies, mainly in the US and in China, and to a small extent, in India as well. It also covers the history of several of the more significant firms such as Kleiner Perkins and Sequoia.The role and importance of venture capital is a hotly debated topic. While it cannot be denied that it has played and continues to play an important role in our progress, do venture capitalists create innovation or do they merely show up for it? Could they have done more to avoid some of technology’s adverse social impact or to encourage technologies such as greentech? Mallaby largely speaks out in favour of the venture capitalists but this part of the book is not as fleshed out as the rest of it. He argues that the future can only be discovered and not predicted, and this is the only form of capital that can enable this discovery by willing to take a large amount of risk (it was hence initially referred to as adventure capital). Mallaby argues that venture capitalists succeeded more due to skills than luck and companies such as Cisco and Google became what they are due to extensive coaching. He exonerates the investors from governance nightmares in companies such as Theranos, WeWork and Uber by arguing that more than three-quarters of late-stage venture funding in the United States between 2014 and 2016 came from non-traditional investors such as mutual funds, hedge funds, and sovereign wealth funds. He does acknowledge the diversity issue however given the fact that a large proportion of the partners in these firms and the founders of their investee companies tend to be white men.Overall, the book is well-researched, laid out well and importantly, is easy and interesting to read. While I do have reasonable prior knowledge of the industry, I think a lay person would enjoy this equally. So, a 5-star book for me!Pros: Extremely well-researched history, several interesting anecdotes, an interesting readCons: Superficial treatment of the social aspects

Hola, me decepcionó mucho la calidad de este libro. Efectivamente se trata de un escaneo de las páginas originales de muy mala calidad y que no permite una lectura cómoda. No podré ir más allá de las primeras páginas. Me sorprende que Amazon haya dejado pasar este tipo de producto. ¿Podría decirme si hay otra edición en Kindle que pueda descargar?Muy cordialmente.