Venture capitalists know that they have to kiss a lot of frogs before they find a prince, but the dot-com era was a uniquely good time for VCs, because the willingness to take companies public under any circumstances—profitability be damned—meant that VCs weren’t punished for being indiscriminately promiscuous. Even the ugliest frogs could be winners. The average yearly return for venture funds that focused on early-stage startups was 25% by 1998, and plenty of the top-tier funds were earning well in excess of 100% or 200% yearly on invested capital.43 VC is a game of blockbusters; one
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