Opportunity Calls

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From remarks by University Trustee Ben Horowitz ’88CC at Low Library on March 4. Horowitz is the author of The Hard Thing about Hard Things: Building a Business When There Are No Easy Answers (HarperBusiness).


Because I’m a venture capitalist, people often ask me why big companies have trouble innovating while individuals and small companies don’t. The answer is pretty simple. Innovation always starts out looking like a bad idea. Big companies have plenty of great ideas, but they don’t innovate because they need a whole hierarchy of people to agree that a new idea is good in order to pursue it. If one person figures out something that’s wrong with an idea — often to show off or to consolidate power — that’s usually enough to kill it. My favorite example of this is the telephone. Western Union actually had the opportunity to buy the telephone from Alexander Graham Bell — patents and everything — for $100,000. They passed. Their internal committee declined. Why would they want to invest in something that transmitted a weak, indistinct speaking voice? They’d already perfected the clearest, most technologically advanced form of communication: the telegraph.

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