Why I Invested in Wired Magazine
It’s a little known fact that I was the first investor in Wired magazine. Nicolas Negroponte usually gets credit for being first, because he said he believed in the magazine and would invest, but only if someone else said yes.
That’s when I came on the scene. Back in 1992, I was contacted by the founders of Wired, Louis Rossetto and Jane Metcalfe. They’d gotten my name from a tech writer in San Francisco (Fred Davis), who told them that I had sold my software company and to put me on their list of potential investors.
I agreed to meet with them soon after, when I would be in S.F. for MacWorld Expo. Before going, I talked to a couple of friends who were editors of tech publications: Dan Ruby of MacWeek and Dan Farber of MacWorld magazine. I was struck by how both of them were enamored with the idea. What they both said was, I would really, really like to write for this magazine.
But what did I know about starting a magazine? Well, absolutely nothing, of course.
So I met with Louis and Jane. Louis, who would be editor, went through the vision for the magazine and showed me a mockup. It was to be about the digital revolution. Jane covered the plan for the business side, as she would be the publisher.
I liked the vision, (but, what the hell did I know about starting a magazine, right?) and what I liked even more was Jane’s business savvy.
What I really, really liked, though, was the two of them . . . together as a team. What I could see, without a doubt in my mind, was that Louis and Jane had that intangible thing that successful entrepreneurs have. It just oozed out of them. It’s one of those things I can’t define; one of those things that, you know it when you see it. And I know it because I have it, too. The two of them together were, to put it mildly, dynamite!
One thing was missing, though, from the investor pitch. I asked what the exit strategy was, and they didn’t have an answer for that.
Then came the conversation I always have with entrepreneurs, which most investors don’t even think about. The question was, why are you doing this? Louis started in with the vision of the magazine again, essentially the marketing of it. I stopped him and said no, I already got that part. The question is, what are your goals? They were still a little non-plussed, so I put it this way: if your life could look like anything you want, and money wasn’t an issue, what would it look like?
I have asked this question often and I never cease to be surprised at how often people haven’t given it any thought. But it’s critical. Major decisions will be based on your goals, on where you want to get to. If you don’t have a 100% clear picture of the goals, how can you make the right decisions?
Louis and Jane were honest and said they had not thought about it that way. I told them that I was interested, but without an answer to that question I would not even consider investing. I’ve had this conversation a number of times and almost always, I don’t hear back from the entrepreneurs.
But two weeks later, Louis and Jane called me. They were pretty excited. They said, wow, we’ve done a lot of soul-searching these past two weeks and thought a lot about your question. And we now have an answer. They started to rattle off things they wanted to do in their lives, and I stopped them, saying I didn’t need them to bare their souls to me, I just needed to know that they had thought it through and knew their goals.
Louis added, “and we now know what the exit strategy is.” My response was: no shit. In other words, it’s always necessary to know where you want to get to . . . in order to have a plan to actually get there.
I truly believed in Louis and Jane, more than any other entrepreneurs I’ve ever met. With that final piece of the puzzle that had to be there, I said on the phone, “I’m in.” I wrote a check, the first that they received and Nicholas did follow through with a check as well, and the two of us were the seed round.
The whole story of Wired is an amazing one. It has been detailed in a book: Wired, A Romance by Gary Wolf. And here’s a fun video with Louis talking about the beginnings of the magazine:
In the end, my gut instinct was right, Louis and Jane had the right stuff. They are an amazing team. What they accomplished with Wired is truly a legendary story.
I still didn’t know a damn thing about starting a magazine, but all entrepreneurs face certain kinds of issues and hurdles, and early on I did a little ‘coaching’, which they obviously valued because my name even appeared on the masthead in the early days as: Coach. For me it was a huge honor and true compliment that I could actually contribute a little bit.
And now you know why my Twitter handle is: wiredcoach. But more importantly, you know why I said yes – because they could answer the question about what they wanted their life to look like. Can you?