Early Days of Venture Capital

The early days of venture capital were marked by key figures and pivotal moments that defined the industry. George Doriot, often considered the father of modern venture capitalism, played a crucial role in shaping the industry. After World War II, Doriot became president of the first public venture capital firm, American Research and Development Corporation, in 1946. Despite predictions of failure, his firm successfully nurtured over 100 startups, including technological pioneers in computers and medical devices 1.

Venture capital began as a specialized financing mechanism and has evolved dramatically over the past decades. From the mid-20th century, when it was institutionalized by figures like Doriot, the venture capital industry saw different phases, including the craftman era (1980-1995), the scale-up phase (1996-2009), and the era of specialization starting from 2010, marked by the emergence of various types of funds catering to specific stages of startup growth 2.

David Senra also discusses the metaphorical aspect of venture capital, aligning it historically with early finance tools like international bonds, emphasizing the continuous human desire to invest in new, potentially profitable ventures, which sets the foundation for modern venture capital practices 3.