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14 of 15 people found the following review helpful
5.0 out of 5 stars WWII and Venture Capital History Lovers - A MUST READ!!!!
Americans always talk of saving France during WWII, yet at the same time, here was an intriguing French immigrant who rose to be a top professor of entrepreneurship at Harvard Business School, a founder of the venture capital industry, founder of INSEAD the European business school and to top it all off- played a critical role in saving countless American lives in WWII by...
Published on April 22, 2008 by J. Chang

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3.0 out of 5 stars Fascinating Character, Dull Biography
This just doesn't go deep enough into the character of Georges Doriot, one of the most fascinating characters in the history of business. It tells the story of venture capitalism's emergence in a workmanlike way, but just barely scratches the surface of Doriot himself.
Published 6 months ago by David M. Freedman


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14 of 15 people found the following review helpful
5.0 out of 5 stars WWII and Venture Capital History Lovers - A MUST READ!!!!, April 22, 2008
By 
J. Chang (New York, NY) - See all my reviews
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This review is from: Creative Capital: Georges Doriot and the Birth of Venture Capital (Hardcover)
Americans always talk of saving France during WWII, yet at the same time, here was an intriguing French immigrant who rose to be a top professor of entrepreneurship at Harvard Business School, a founder of the venture capital industry, founder of INSEAD the European business school and to top it all off- played a critical role in saving countless American lives in WWII by leading the innovation and production of quality military equipment and supplies.

Ante's portrait is one of a driven maverick, visionary and Renaissance man who made an astonishing contribution to the war effort and modern business culture, and yet he seems very human and at times poignant. I was especially moved by Doriot's tireless passion in helping American soldiers as well has his 48-year marriage to his wife Edna and how they spent their last years together.

I loved this book because it's such an unusual and valuable contribution to our understanding of the 20th century. Doriot has been an unsung hero in many ways, and by bringing his life into focus, Ante weaves people and international events in a way that makes us see our world as ever more fascinating, multi-faceted and interconnected.
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6 of 6 people found the following review helpful
5.0 out of 5 stars An inspirational mentor -- General Doriot, July 9, 2008
By 
B. Beatty "cirencester" (Winston-Salem, NC United States) - See all my reviews
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This review is from: Creative Capital: Georges Doriot and the Birth of Venture Capital (Hardcover)
I was in the General's class at HBS in 1961. When he discovered that I was an active duty military officer, he took an obvious personal interest in me (although he did not call me "Bernie", as he called Samuel Bodman "Sammy"). Nevertheless, I will never forget the inspiring interactions with him and his varied guests from many walks in life, including Jackie Cochran, pioneer aviator. The author has done a first-rate job of pulling together details that shed light on a great man, as well as his wife. I finished the book in record time.
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4 of 4 people found the following review helpful
4.0 out of 5 stars The Unexpected Father of Venture Capitalism, August 4, 2008
This review is from: Creative Capital: Georges Doriot and the Birth of Venture Capital (Hardcover)
Spencer Ante sheds a powerful light on the life and accomplishments of a foreigner who came alone to the U.S. in 1921 C.E. That man had neither family nor friends at his arrival. Furthermore, he never graduated from college in his native country. On top of that, that man was not rolling in money. The WWI had wiped out his father financially.

However, that foreigner had some assets: a strong Protestant work ethic, a passion for technology and the future, a confident yet humble personality that was at ease with people of all stations in life, a strong volubility, a sense of compassion, and a deep understanding of the importance of education. Furthermore, that same foreigner wanted to run one day his own company after the example of his father.

Who would have bet in 1921 that such a foreigner would one day become:

1) Arguably the most influential and popular professor at Harvard University's Graduate School of Business;
2) The driver behind the foundation of INSEAD, one of the leading business schools in the world;
3) The man who played a key role in the well-being of the American soldiers during WWII by spearheading to their benefit a quite revolution in engineering;
4) And last but not least, the father of the venture financing industry as we know it today around the world.

That foreigner was a Frenchman and his name was Georges Doriot. As it is often the case, an extraordinary woman, who remained mostly in the background, was part of that story. Her name was Edna Allen and she was American.

To summarize, Ante succeeds in bringing back to light a man whose contributions deserve to be better known, especially, in business circles.
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3 of 3 people found the following review helpful
5.0 out of 5 stars A Must Read!, January 5, 2012
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This review is from: Creative Capital: Georges Doriot and the Birth of Venture Capital (Hardcover)
Creative Capital is a must read for anyone that wants to know the history of venture capital - the single greatest engine for growth in the U.S. economy over the last 30-40 years.

Spencer Ante has written the definitive work on the industry's history. If you're a young VC or someone that wants to know how innovation works in the U.S. I highly suggest reading this book.
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2 of 2 people found the following review helpful
5.0 out of 5 stars Creative Capital: An extraordinary book, April 25, 2012
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This review is from: Creative Capital: Georges Doriot and the Birth of Venture Capital (Hardcover)
Creative Capital provides a detailed portrait of the extraordinary Georges Doriot, who (surprisingly) was the founder of the U.S. venture capital industry after World War II. His pioneering VC firm was the source of funding/growth (and counsel) to the legendary tech innovator, Digital Equipment Corp. (who knew Doriot was behind DEC, which, for many years, scared the heck out of IBM because of its rapid growth using new technologies?). Doriot was also, apparently, a very successful professor at Harvard Business School, and played a key role working for the U.S. military during WWII as a kind of national "quartermaster", helping ensure our soldiers had the best equipment available. Spencer Ante must have spent a long time researching the book. It is a worthy and entertaining read for anyone who wants to know the origins of the VC industry (East Coast, not West Coast) and learn about an extraordinary but little known leader. I hope it becomes the basis for a TV bio at some point. It has enough drama, for sure.
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2 of 2 people found the following review helpful
5.0 out of 5 stars How VC has changed, February 20, 2011
This review is from: Creative Capital: Georges Doriot and the Birth of Venture Capital (Hardcover)
Spencer Ante gives a wonderful history of General Doriot and the way he created organized venture capital in this country. Hearing of Ken Olsen's recent death prompted me to re read parts of it, and I was again impresed with the various insights Doriot had. It's also interesting to read how he fought with the SEC for years - since it didn't understand the concept of a nonmutual fund investment company. This is being played out again as the new regulations being proposed under Dodd Frank may again stifle some of the flexibility that venture capital firms need. The descriptions of Doriot's beginnings, his move through academia and the creation of Digital Equipment Corporation are extremely well drawn and compelling. This is a must read for any with an interest in the venture world.
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2 of 2 people found the following review helpful
5.0 out of 5 stars Venture Capital started on the East Coast, July 16, 2009
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This review is from: Creative Capital: Georges Doriot and the Birth of Venture Capital (Hardcover)
Creative Capital develops the frame of mind that was necessary to ultimately launch the venture capital world in the US. That VC was encumbered by political and corporate realities is entirely the point. As you hear those outside of the money world (journalists, academics, regular folk) talk of VC, you may wonder if it really is so free wheeling. No, it is not and Creative Capital makes that abundantly clear.

The historical context of Georges' life and even his father's was helpful and instructive. What was most powerful was the discussion of later years when Georges' firm struggled to retain talent and to place investments. An argument is made that essentially tax code crippled the firm - my over simplification for review purposes. For students of politics and how politics shapes economies, this is an excellent resource.

At no point is any character in the book beatified. This is not a sing-songy congratulatory book. It is a solid look at the conditions that led to early VC on the East Coast and eventual dominance by VC on the West Coast . . . it wasn't the trees, running trails and views that pulled people West. You will get a much better feel for the forces that pushed VC out of the East as well as the forces that drew VC West.

It is a great read about an inspirational Frenchman who was thoroughly American. American spirit at its best.

1 part history, 1 part politics, 2 parts economics, 3 parts clever

Good for: Economy shapers, history buffs, and those needing a little inspiration through the power of perseverance.
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2 of 2 people found the following review helpful
5.0 out of 5 stars HARVARD BUSINESS SCHOOL'S BEST, July 7, 2008
This review is from: Creative Capital: Georges Doriot and the Birth of Venture Capital (Hardcover)
I was General Doriot's student at Harvard in 1960. He and his views had a profound impact on my life, both in business and personally. His emphasis on ethics, patience, creativity and freedom led me, in my various roles in life, to pass on these same qualities to all my associates.
The book is well written and provides a useful insight on the private man. It's too bad that this information was not available in 1960.
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1 of 1 people found the following review helpful
4.0 out of 5 stars The father of venture capital: Georges Doriot, June 14, 2013
By 
Herve Lebret (Lausanne, Switzerland) - See all my reviews
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This review is from: Creative Capital: Georges Doriot and the Birth of Venture Capital (Hardcover)
Not many people ever heard of Georges Doriot. I knew his name because I know a little about VC. But I did not know much about him. Now that I read Creative Capital by Spencer Ante, I know much more. As usual, when I comment books, I mostly do some copy-pastes. Here they are:

In 1921, Doriot came to America on a steamship. Even though he had no friends or family in the United States, never graduated from college, and dropped out of graduate school, the Frenchman became, arguably, the most influential and popular professor at Harvard University’s Graduate School of Business. Over three generations, Doriot taught thousands of students [Page xiv].

He was early to recognize the importance of globalization and creativity in the business world. “A lot of the things that were attributed to Peter Drucker [link blog] were Doriot’s ideas” says Charles P. Waite [Page xv].

He believed in building companies for the long haul, not flipping them for a quick profit. Returns were the by-product of hard labor, not a goal. Doriot often worked with a company for a decade or more before realizing any return. That is why he often referred to his companies as his “children”. “When you have a child, you don’t ask what return you can expect” Doriot was quoted in a 1967 Fortune story “Of course, you have hopes – you hope the child will become President of the United States. But that is not very probable. I want them to do outstandingly well in their field. And if they do, the rewards will come. But if a man is good and loyal and does not achieve a so-called good rate of return, I will stay with him. Some people don’t become geniuses until after they are 24, you know. If I were a speculator, the question, of return would apply. But I don’t consider a speculator – in my definition of the word – constructive. I am building men and companies.” [Page xvii]

“A creative man merely has ideas; a resourceful man makes them practical.” [Page xviii]

[He] ushered a new era of corporate culture. At Digital, the engineer was king. Hierarchy was out. Controlled chaos was in. Like Jack Kerouac and the Beat Generation, Digital was a petri dish in which the counterculture was spawned in the late 1950s. “He was definitely part of a social revolution that loosened things up.”

For 20 years Doriot was a professor and a business advisor. “How did a man with hardly any experience running a business come to be such a world-class businessman? The answer is that during those years, dozens of companies hired the professor to help guide them through the worst disaster that ever hit the American economy. In that dark decade, Doriot gained a lifetime experience as an officer, director and consultant” [page 64].

American Research and Development Corporation (ARD)

The idea of an entity helping companies by making risky investments was born before World War II but could be implemented only in 1946. On June 6, 1946, the American Research and Development Corporation (ARD) was incorporated under Massachusetts law. It believed in “innovation, risk-taking and an unwavering belief in human potential”. They also realized that organizations with fiduciary resources and the seasoned operators running them were not daredevils skilled in the art of invention and that, conversely, inventors were struggling creative types with no money. ARD sought to bring together these two independent yet largely separate communities.

Typically, ARD preferred to take a hands-off approach. They were there to coach, guide and inspire. Running the business was the job of the entrepreneur. But quite often, circumstances called for more drastic action. [Page 121]

“Never go in venture capital if you want a peaceful life”. [Page 126] In 1953, Doriot was gloomy about the state of venture capital. “Venture capital is not fashionable anymore.” Waves of technologies seemed to come out of nowhere and crash onshore every twenty or thirty years. The trick of a venture capitalist was to catch the wave several years before it crested ad to bail out before it crashed. [Looks like speculation, or doesn’t it?] It is interesting to see how the great interest that existed seven or eight years ago in venture capital has disappeared and how the daring and courage which were prevalent at that time have now waned” wrote Doriot. [page 138]

A star is born – 1957

“In the early 1950s, the postwar euphoria of the previous decade that had infused Americans with a sense of infinite possibilities morphed into a Cold War miasma of fear and paranoia. Yet underneath the surface of fear, a subculture of experimentation and rebellion flourished. In the early – to mid-190s, Allen Ginsberg, jack Kerouac, and William Burroughs developed a radical new form of literature that emphasized “stream of consciousness” writing. Modern abstract painting by Jackson Pollock, Willem de Kooning, and Mark Rothko overthrew European conventions of beauty and form. And in laboratories and universities across the northeastern seaboard, a bunch of scientists and engineers tinkered away on strange but powerful new electronics and computer devices that promised to completely change the way people communicated and conducted business. “ [Page 147]

In the spring 1957 Ken Olsen then at MIT would team up with his buddy Harlan Anderson. They had an idea and a plan. They needed some money. They approached General Dynamics, who “turned them down flat because we didn’t have any business experience.” Then they contacted ARD. ARD had the perfect formula: two grade A men paired with an outstanding idea. ARD offered $70,000 for a 70 percent stake. Ten percent was reserved for a seasoned manager (who would never be found or hired) and the remaining 20% to the 2 founders (12% to Olsen and 8% to Anderson). Because computers were not fashionable, the company project name was changed from Digital Computers to Digital Equipment Corporation (DEC). [Pages 148-150]

The birth of a new industry

1957 was a critical year. America was shocked by the Sputnik. Public money flowed both to R&D with the creation of ARPA (later DARPA) and to venture capital through the new SBIC program. “Many of today’s most successful venture capitalists rightly point out that the SBIC program never created a company of considerable or lasting success. But if the SBIC program did little to advance the art and practice of successful venture investing, it did help propel the venture industry by attracting talented young men who later became pioneers of the field.

In 1957, Doriot also worked at the creation of INSEAD in Paris which was opened in September 1959. Doriot would have 3 careers in his life, a professor at Harvard business school (including helping in the creation of INSEAD), a consultant and even a administrator for the Army, the reason why he was a general and finally a VC with not only ARD but also at the origin of TED (UK), CED (Canada) and EED (Europe).

The success of DEC would make ARD highly successful but would also contribute to its end… As an investment company, ARD was highly regulated; compensation of its employees would become a long battle with SEC and IRS. Only 4 ARD employees would get DEC shares (worth $20M for each individual) and the allocation looked arbitrary to many. “Pressure was growing on ARD to divulge its growing mess of regulatory problems, and to take Digital public. But Doriot did not think Digital was ready to deal with the unforgiving spotlight of public ownership.” [Page 186]

Doriot did not prepare his succession, incentives were low for employees. Some left. Elfers was first and founded Greylock, Waite would follow him. “There was one more reason Elfers left. He realized along with an increasing number of investors in new companies that venture capital and the stock markets mixed as well as oil and water. For Elfers, the solutions to many of ARD’s problems was to take advantage of a new organizational form: the limited partnership (LP). In 1959, the first LP was organized in Palo Alto: Draper, Gaither & Anderson. Then in 1961, Arthur Rock, a former student of Doriot formed Davis & Rock. There were distinct advantages. General partners who ran the firm received not only a management fee, they also received a share of the capital gains. A limited partnership would avoid the glare of public disclosure.” [Page 190]

Still the DEC IPO was a success. “The Digital IPO amounted to a financial revolution. It was really mind-blowing that you could take such a small amount of seed capital and get ownership of a company that was worth more than IBM in a fairly short period of time.” [page 197]

The emergence of Silicon Valley

“Today many financiers and entrepreneurs assume the west coast always dominated the VC business. They simply do not realize the industry was pioneered by ARD and a few other northeastern firms in the three decades following World War II. So why did Silicon Valley take over leadership?” [page 227] Spencer Ante explains that with MIT, Harvard, in Boston and New York as the financial capital, the East Coast had a huge lead; but a hospitable climate, ethnic diversity and the vision of Terman at Stanford were critical for the West. “Terman was disturbed to find most of his top students fleeing to the east coast. In 1934, two of his best students, Dave Packard and William Hewlett, followed the same path. Terman wooed them back.” [page 229] Then following Fairchild, semiconductor makers started popping up all over northern California. “All It needed was a steady supply of venture capital.” It’s ironic to read that Tom Perkins declined joining ARD. He wanted to launch his own firm. With Sequoia, Kleiner Perkins would become one of the top 2 VCs in Silicon Valley. The rest is history… ARD was merged with Textron for $400M in 1972. It had made more than $200M in DEC from an initial $70k seed investment.

“In 1978, there were 23 venture funds managing $500 million. By 1983, there were 230 firms overseeing $11 billion. “ [page 250] No doubt, the East Coast missed some of the features that the West would develop with an open culture and the right incentives, in addition to what Doriot pioneered on the East Coast… He dies on June 2, 1987. He was 87 years old.
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1 of 1 people found the following review helpful
5.0 out of 5 stars A Must Read for all Entrepreneurs and Investors, May 13, 2013
This review is from: Creative Capital: Georges Doriot and the Birth of Venture Capital (Hardcover)
I loved this book! Its a must read if you want to start a company. I have recommended it to all my friends who are building companies. As a reader you get a unique insight into how the venture capital industry was created. You get to learn the remarkable never before told story about Georges Doriot. The book is incredibly inspiring. I also loved to read the story of how Digital Equipment Corporation (one of Doriots major investments) went from a tiny start up to a major computer company -- and in turn was the "proof" that venture investing can be very profitable. It is also fascinating to read how the US government via the SEC is doing everything they can to fight him when now the venture industry and all the large technology companies that have been created as a result is a major economic driver for the US.

As an entrepreneur I felt I could go out and conquer the world after reading the book. The only minor negative is that I found the War chapters a bit long (but they are important to understand his character so worth reading).

Highly recommended!

Are Traasdahl
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Creative Capital: Georges Doriot and the Birth of Venture Capital
Creative Capital: Georges Doriot and the Birth of Venture Capital by Spencer E. Ante (Hardcover - March 11, 2008)
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