I paused. I was floundering badly. I felt a nudge under the table. 'Give up,' whispered Daniel, very quietly out of the corner of his mouth. But I couldn't.
'Frank,' I began. 'We made an agreement. We have to stick to the spirit as well as the letter of it. We both know that Craig thought we were committing the second three million dollars. I thought that too.'
Frank didn't answer. He glanced at Gil.
Gil took a deep breath. 'OK, do we go ahead with the extra three million? Frank, I take it you say no?'
Frank nodded.
'Art?'
'No.'
'Ravi?'
Ravi glanced down at my memo through his half-moon reading spectacles. With curly grey hair, a bow-tie, and a large fleshy brown face, he looked more like a professor than a venture capitalist. He thought for a moment, but he could tell the mood of his partners. He shook his head.
'Diane?'
Diane had been listening closely to the exchange. Now all eyes were turned to her. She sat there with perfect poise, her thick dark hair framing her high cheekbones, her small delicate lips puckered in thought.
'I think we should go with it,' she said at length. 'I take Frank's points, but I remember when we did this deal. We knew then we were in for five million. It's an exciting market, and maybe we have got a winner here.'
I gave her a quick smile. The support was too little too late, but I appreciated it.
Gil listened to her with respect and nodded. 'Thank you, Diane.'
The room was silent as Gil studied the papers in front of him. We let him think. Then he sat back, folded his arms and delivered his verdict.
'No.'
All eyes were on me. It felt like a physical slap in the face. I had lost a deal. Somewhere I had gone wrong, and I had a feeling that it had little to do with Net Cop and more with Revere. I should have taken the time to prepare the political ground more carefully, to square Gil. I shouldn't have allowed myself to be ambushed by Frank.
Gil took some pity on me. 'I'm sorry, Simon. I go with Frank on this one. When a deal turns sour, you should take your losses. We've learned that lesson over the years the hard way. I'd like you to get hold of the lawyers and work out how best to present this to Net Cop. But I don't want to lose our two million if we can avoid it.'
'Without the extra three, Net Cop's finished,' I muttered, pursing my lips.
'Well, salvage what you can,' said Gil.
My first bad deal! That was a blow to my ego, but I could live with it. In fact it was probably an essential part of my education as a venture capitalist. What I couldn't live with was going back on my word.
'I can't do it,' I said.
Gil looked at me sharply. 'I don't think you understand, Simon. You've made your points. We've listened. We've decided to pull out. Now it's your job to do just that.'
'We made a moral commitment to give Net Cop the funds. I made a moral commitment. I can't go back on that.'
Art, who had been quiet throughout this, suddenly burst in. 'Hey, quit playing the English gentleman with us. This is business. We back winners, and when they stop being winners, we drop them. It's tough, but that's how we make money for our investors-'
Gil held up his hand to stop Art. 'OK, Art, OK,' he said calmly. He turned to me. 'I appreciate your sense of integrity, and I think there is a place for it in the way we do business at Revere. And I agree we had a moral commitment to invest more money, provided we were happy with the way the business was being run. But we're not.'
Gil looked to me for a response. I didn't give him one.
'Investment decisions must be based on the commercial realities,' he went on. 'And the reality here is that the partnership doesn't want to invest. It's not your decision, it's ours. All we ask is that you carry it out.'
They were all staring at me. 'I can't,' I said, and picked up my pen and pad and left the room.
I sat at my desk in the empty office I shared with the other two associates, my brain tumbling over what had just happened.
I had been at Revere just over two years, joining straight from business school. From the beginning, I had been determined to succeed, to make the serious money that American venture capitalists can earn, to break out of the traditional constraints of my past: my father's tide that had now become mine, public school, university, the army. In my middle twenties I had realized that my life of tradition and privilege, which since boyhood I had been told was the pinnacle of human civilization, was for me a cold prison cell.
There was something beguiling about being an officer in the Life Guards: the sense of belonging to an elite, a sense of superiority that had been carefully honed by centuries of regimental pomp, ceremony, myth and
I was definitely one of those people.
And I had been doing well. PC Homelease had made eight million dollars for Revere in six months out of a half-million initial investment, and had won me recognition in the firm as someone who was either smart or lucky. Gil thought highly of me, and until today, so had Frank. I badly wanted to make partner; that was where the big money in venture capital was made. At a lunch a few months before, Gil had hinted that this was a definite possibility. Was I now going to throw it all away?
But I had given my word. I couldn't go back on it.
Why couldn't I? Was this just another one of those precepts that had been programmed into me at school and in the army, that a gentleman's word was his bond?
No, that wasn't it. I knew plenty of gentleman liars. It was just that in life there were some people you could trust, and some you couldn't, and I thought it was important to be one of those you could.
The other two associates returned from the meeting.
'Have you got a death wish, or something?' asked Daniel, as he threw his legal pad on to his desk by the window. Short, thin, with dark hair and pale skin, he was the most aggressive, and probably the brightest of us. 'Once they say no, they mean no, you know that.'
I shrugged.
'Man, that was rough,' said John, putting a hand on my shoulder. 'They mauled you in there.'
'It certainly felt like it.'
He powered up his computer. 'I think you were right, though. If you say you're gonna do something, you've gotta do it.' He gave me a friendly smile.
'Bullshit!' Daniel said. Art's right. You've always got to do what makes financial sense. That's what the investors in our funds pay us for.'
I ignored him. There was no point in arguing with Daniel on the question of ethics. He was the personification of the concept of 'market forces' as a religious system. If something's price goes up it's good, if the price goes down it's bad. We had both been recruited from Harvard, and despite the compulsory ethics courses we had attended there, we had been given plenty of academic justification for the supremacy of the pricing mechanism as a moral tool. Daniel didn't need any of this, though. He was a natural believer.
John was very different. Tall and athletic, with mousy brown hair and big blue eyes, he looked younger than his thirty years. He had been at Revere the longest of the three of us. His father, John Chalfont Senior, was one of America's richest men. He had built up Chalfont Controls into a multi-billion dollar corporation, and for a couple of decades had made regular appearances in the business magazines, where his views on hard-working Americans, corrupt politicians and unfair foreign competition were stridently broadcast.
But John Junior had little interest in hard work or money, managing to do just enough to scrape into an Ivy League college and business school. His ambition seemed to be to lead an ordinary life, free of hassle, which, given who his father was, was not easy to achieve. Joining Revere had kept his father happy. Daniel said John would
