review my idea for a consultancy/incubator [slides]
naval: I originally started my angel fund as an incubator (The Hit Forge). I quickly moved away because of Adverse Selection - the best entrepreneurs are insanely committed to themselves and their ideas, and rationally or irrationally, don't want to diversify. Since then, I've invested in a lot of companies, including Twitter and Disqus and Heyzap, and am glad that I did so. The Incubator model works as a "search" model (MRL Ventures, Obvious Labs, Ooga) where the Incubator "finds" a company that the principals join, but not as an "investment" model where the incubator survives and keeps spinning out companies. This is true because you can't create or replace entrepreneurs - you can only discover them or be them, but you can't create them.The other problem with this proposal is that the Internet is extremely competitive. You can't do anything great part-time over the long term. A funded team working full-time has a huge advantage on you.Of course, giving up control sucks. "Valuation is temporary, control is forever." And a business controlled by VCs too early can't innovate easily. So, either raise money from angels, or learn how to negotiate with Venture capitalists. Check out Nivi and my writings (sorry, shameless plug) at http://www.venturehacks.com.If you do have a good product with traction and are out raising VC money, ping me and I'd be happy to help you keep control (free!)