Eboys: The First Inside Account of Venture Capitalists at Work

by Randall E. Stross, Eric Conger (Reading)

The first inside account of life within a Silicon Valley venture capital firm, eBoys is the fascinating true story of the six tall men who backed eBay, Webvan, and other billion-dollar start-ups that are transforming the Internet and setting a new pace for the economy.

Randall Stross, author of acclaimed books on Microsoft and Steve Jobs, blends a business historian's perspective with a journalist's flair for suspenseful storytelling to look at wealth creation up close. For two years, Stross gained unprecedented access to the venture capitalists at Benchmark, an upstart firm founded by thirtysomething renegades whose average height happens to be 6´5´´. Since Benchmark's founding in 1995, each partner's net worth has increased, on average, $100 million annually.

Stross was present as the Benchmark boys debated which businesses to support, and by recounting their conversations in testosterone-rich detail, he offers readers the most precise and enlightening account of the ways in which venture capitalists think, evaluate prospects, and wield influence.

Stross also gained access to a number of the Benchmark-backed start-ups, including a small, privately held San Jose company called eBay. The value of the company grew from $20 million to more than $21 billion within two years of Benchmark's investment, an increase of 100,000 percent. Business Week called it "probably the best venture capital investment of all time."

Venture capitalists have become iconic symbols of our time, just as investment bankers, investigative journalists, and hippies defined previous eras. In eBoys, Randall Stross has vividly captured the interplay of ambition, personality, experimentation, and risk, all acted out, larger than life, as the men of Benchmark and the entrepreneurs they back play their remarkable roles in the new world of Internet commerce and the creation of vast, sudden wealth.


From the Hardcover edition.

Genres: Business, Technology, Nonfiction, Entrepreneurship, History, Finance, Startup

Audio

First published May 23, 2000

Reviews

[Anuj · Rating 4 out of 5]

A great narrative of what is recognized as the craziest investing period of venture capital. Many anecdotes told today are brought up as well.

If you are a fan of the startup / early stage investing space, this will be a fun read you wished didn’t end.

[Gabriela · Rating 5 out of 5]

A definitive must-read for venture capital enthusiasts. It’s the kind of book it hurts to finish
eBoys gives the reader a glimpse of what it was like to work in one of the wildest investment periods in Silicon Valley history. It is a unique insight into the early days of Benchmark Capital and its partners.
Interesting (and fun) to observe the venture scene nowadays and what has happened to the companies after all this time (eBay is now struggling against Amazon, ToysRUs filed for bankruptcy,...).

[Joe · Rating 5 out of 5]

A rare glimpse, this book is a treat to read.

[Marat · Rating 4 out of 5]

Interesting story of Benchmark Capital, a Silicon Valley VC firm and their investments during the dotcom boom in the late 90s and early 00s, pre- bursting of the bubble. Conveys the atmosphere of the industry and the personalities - all very gung-ho and "American", which makes for entertaining reading. The stories and mini-case studies of individual investments are quite insightful - there are a lot of pages devoted to Ebay's development and other less successful investments (e.g. ToysRUs website).

Interesting to look up what happened to most of the investee companies mentioned. Can't help but think a typical example of the dotcom mania is Webvan - the Benchmark fund put in something like USD 3m into building a very capex-intensive business, raising follow-on capital from other funds and eventually making a killing in the IPO, where this loss-making company with an unproven business model was valued at USD 100bn. Webvan went bust in 2001, was eventually sold to Amazon and according to Wikipedia got the dubious honour of being named the largest dotcom flop in history by CNET. No doubt a highly successful investment for the Benchmark LPs who cashed out in the public offering, but from the perspective of long-term value creation for the public who bought into the IPO - a disaster.

Personally another thing that surprised is the ease with which companies were rolled out and raised money - you keep reading about 6 months and 12 months timeframes for follow-on capital-raisings and 18 months to IPO conferring ridiculous paper wealth on the founders. Good times.

[Sean Rich · Rating 2 out of 5]

This was honestly more focused on dialog between the benchmark founders. While it was cool to see an inside look, most of the stuff they did was pretty obvious; the venture world today is much different. It was probably pretty hard to screw up the dot com boom.

[AG · Rating 5 out of 5]

I read this book following a mention on the Acquired podcast and thoroughly enjoyed it. This book gave inside details into venture capital providers including the discussions that take place, considerations when investing in a new opportunity, success/failures, and so on. The best part is it is with Benchmark Capital and they operate a little differently from most. In the book, you can see they face challenges that other investors may also face including speculative technologies that are hard to evaluate, unexpected business operational issues, etc. The book ended with just a superb topic too regarding evaluating long-term success and how some of the partners' sources of pride is derived differently than "just" the entry/exit price of their investment. They also show some skepticism of their process when there is luck involved, such as an exit that is bought by another company but then subsequently shelved. It's only profitable because someone bought it in that case. Overall, this was an excellent book and such a hidden gem. I'm glad the folks at Benchmark allowed this journalist access to so many behind the scenes discussions.

[Fellow · Rating 5 out of 5]

Eboys is a great account from Benchmark venture 5 first years. It includes both wild ride of partners and some of their portfolio companies.
The fund returned 92x to their investors so by any measures was an anomaly similar to the times it operated in, but to be honest anything that provides that kind of returns is an anomaly, especially if you'll factor in the size of the fund.

If you are in VC or VC backed startups this is a must read (altough it's 19 years old so don't expect fundraising tactics here).

If there is anything close to good old days in sillicon valley this book might be the closest account to that period of time.

Great reporting, great read.

PS. Thanks to Olek Wandzel & Bartek Gola who pointed me to the fact that there is an audiobook of eBoys in Audible.

[Rogue Reader · Rating 4 out of 5]

Talk about a big gulp, eBoys is about the biggest gulp ever despite its practice of low level, equity position investing in early stage startups. One of the write ups in the financial pages is that the tall boys of Benchmark acted as a pack: consulting, trading off negotiations, making deals. Dave Bierne, the biggest gulper is large in the book but has since taken the fall for the internet bubble pop and has essentially been written out of Benchmark history. Fascinating read of the biggest and smartest gamblers ever who won a lot and lost big too. eBay is theirs, now so is Uber among others. Lost to time and bankrupcy is Louis Borders' idiocy, WebVan, Bierne's deal. Stross does an excellent job as a bystander, documenting this incredible piece of economic and social history.

[Terence · Rating 3 out of 5]

It's an interesting book, although it doesn't help improve the VC stereotype of Ivy League white guys who don't know how to run a business but simply get lucky 10% of the time.

The use of "he's a good guy" and the measurement of people by stature and presence over expertise is not surprising.

It's amazing how bad they managed Webvan and amazing that a non-tech ceo (Meg Whitman) was able to have success at eBay.

There are plenty of dad jokes, and most of the conversations that were captured are short on details, and decisions seem to be driven mostly by emotion.

It's better to be lucky than good, I guess.

[Rohit N · Rating 3 out of 5]

This book was written at a certain age and time. Some examples illustrated here as successes do fail later. Read this for a snapshot of venture capital history and understanding the thinking that goes behind investments. It certainly deserves attention for capturing the great hysteria on the first wave of Internet companies.

[Looking Glass · Rating 4 out of 5]

Ultimate fly-on-the-wall story of VC

Hard to find a book like this: it often reads as a verbatim Re-telling of conversation after conversation among the Benchmark partners. You gotta love Stross’s profile of Dave Beirne and his creation of his own executive search firm prior to joining Benchmark. Story of answering machine message demanding payment a classic!

[Anna Fuller · Rating 4 out of 5]

This book sits at the interesting and unfortunate vantage point of being published right before the .com bubble burst. It was fun hearing doubts about the companies who made it successfully through and are still known today (Priceline) and equally fun hearing the author and VCs rave about companies that imploded shortly thereafter (Webvan).

[Lawrence Harte · Rating 5 out of 5]

If you are going to work with venture capital VC companies or private investors, you should read this book! Lots of insights into how VCs and investors make funding decisions and the hidden role they play in executive hiring and project decisions. Really interesting success stories (Priceline, eBay, etc) and failures (e.g. Webvan).

[Lucas Madeira Lameiras · Rating 5 out of 5]

One of the very best books I've ever read. WoW! If you're early on in a Venture Capital career, this is a must-read book. It shows how to do things the right way. Also, many gems regarding investment and career advice. The book was undoubtedly spiced up for publishing, but it is a must-read nevertheless. Outstanding.

[Vinai Rachakonda · Rating 4 out of 5]

Super fun read. Two takeaways
1) Timeless Qualities of founders: 10x Interesting, wild age variation, and crazy ambitious. Current alumni network models and being in the “right” network are timely and unlikely to elicit the best companies
2) founder-ceos are such a recent phenomenon. Can’t believe so many founders would just hire ceos. Maybe it’s just a benchmark thing?

[Colin Keeley · Rating 5 out of 5]

eBoys is the best book I’ve read on VC (published in 2001)

-inside look at Benchmark partner meetings and debates about businesses

-story of ebay, webvan, http://toysrus.com and others

-1st fund returned 92x ($350m to each partner)😲

[Sten Tamkivi · Rating 4 out of 5]

Good paced founding story of Benchmark, told through the stories of their portfolio companies in the frothy years of the dotcom boom of the nineties (eBay and Webvan as prime examples on quite opposite extremes).

[Christian Louis · Rating 4 out of 5]

Emotionally well described

As a venture capitalist myself I enjoyed the description of emotional roller coaster. But the stories were disjointed and as a book not well composed.

I think it is worth reading when you are an insider but not necessarily as an outsider.

[Garrick Infanger · Rating 5 out of 5]

Excellent in-the-room journalism at one of the 'it' venture capital firms of the dawn of the Internet era. Almost more fascinating now with 25 years of perspective. What a truly insane and unique time in business.

[Trent · Rating 3 out of 5]

I wanted to like this significantly more than I did. I might have been a bit distracted as I listened, but I wanted a lot more of what made Benchmark Benchmark, and less about the companies that they invested in that made them successful.

[Steve Biko · Rating 5 out of 5]

Amazing fly on the wall account of an early venture homerun shop

[Van · Rating 5 out of 5]

Fascinate insight into the formation, success and failure of eBay and Webvan.

The story made a lot of sense back then when eBay was flying high and Webvan was a dismal failure. We are in 2020. eBay is struggling against Amazon. Doordash and Instacart are doing very well.

[Connor Van Ooyen · Rating 5 out of 5]

Very interesting and not dense

[Phil · Rating 4 out of 5]

A really enjoyable time capsule from the late '90s. It put a lot of numbers and context behind some of the companies I read about and some that are still around.

[Peter Boyce II · Rating 5 out of 5]

Rare & insightful lens into elite venture & the dot com boom

[Beth · Rating 5 out of 5]

It's interesting to read 25 years after the events. This was published about the time the dot com bubble burst, which may be ironic.

[mark d haft · Rating 4 out of 5]

This was a very enjoyable read about how the Benchmark VC team came together and an inside look at some of the top startups on the mid 90s that become Unicorns. The book ends in 1999 just as the tech bubble is about to crash. I think there needed to be an epilogue as further research showed that some of the outcomes weren't as rosy as during the tech boom.

[Mert Yücesoy · Rating 5 out of 5]

Fun reading and interesting stories around Benchmark who is the top one of the best VC funds out there. Very inspiring.

[Mohit · Rating 5 out of 5]

So good, it hurts to finish. Waited a month for the used hardcover to arrive. Worth it.

[Elihu Whitney · Rating 5 out of 5]

Excellent book