NYT has an interesting story for entrepreneurs that discusses Friendster. It shows how one can be a pioneer and fail misrably. The best wxample of that is:
 Roughly once a week, David L. Sze, a venture capitalist at Greylock Partners, hears from entrepreneurs who say they have the next MySpace, the copycat social networking site that has trounced Friendster. “The counter to that is, ‘Tell me why you aren’t going to be the next Friendster,’ � Mr. Sze said. “It’s become the iconic case of failure.�
Some good lessons in this article.
That is my biggest fear when approaching VCs.
Very true though as in the net the rule is that there is only space for only one or two companies in a niche ex: amazon, ebay etc. and the remaining are “no names”.
With this being the case anyone who invests money would sure be to look at the revenue potential of a firm before they invest in. I agree with the VC point of view.
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