We have so few choices when we engage the subject of entrepreneurial investing, and I have never really understood why.
How is it that we have arrived at a place that it is ok for inventors to have to sell out their technology or their company to receive some simple investment capital?
Our inventors and visionaries have had to endure the venture capital investment approach for the last 70 years, and while it serves some, it does not serve so many others.
In fact, upon even deeper reflection and analysis, I have come to understand that the venture capital model itself does not serve the big picture in various ways for the population in general, let alone for inventors, surgeons, or patients, due to its insidious role in a much bigger dynamic at hand.
Short Term Gains vs. Long Term Value
If you’re an inventor who wants to build a company and sell quickly, then today’s venture capital (VC) model is perfect for you.
However, if you want to earnestly build something of long-term value while staying private and sovereign, while maintaining your personal right to self-determination for yourself and that of your company, today’s VC model is not your ideal first choice. Your sovereign rights are forfeited in the current model.
This has never sat well with me.
The brilliant inventors and visionaries of our time have lost their freedom through the financial sector, and it is time for this to be rectified.
In my mind, it comes down to a question of either respect for creation, or respect for money. While both are critical for ideas and companies to get off the ground, somewhere, somehow, honoring our creators and inventors got lost in the dust and frenzy of chasing the highest rates of return.
I give the VC industry its due, as these rules were set a long time ago. Today’s MBA holding VCs are just responding intelligently to the game that was set up back in 1919 when investor primacy became the law of the land, along with our definition of fiduciary responsibility.
These legal precedents were set over a hundred years ago and have remained unquestioned ever since. These insidious seeds took root and have been inadvertently hidden within the fabric of modern medical entrepreneurship. Their deleterious implications and consequences are everywhere—impacting people, companies, industries, global economic sectors, and even various nations’ sovereignty.
It is time to approach medical product creation, and frankly all creation, from the perspective of inventor primacy rather than investor primacy. By honoring our creators as a priority, we can begin to heal what is wrong in the current system. By first aiming for what is true about the creation and inventor process, and then hitting the mark with an investment model that honors this truth, we can begin to organically realign the capital raising system—with a little collaboration from everyone.
Reverse Engineering the Traditional VC Model
Intending to understand how to change the way we engage entrepreneurial finance, I realized that the key was to directly challenge the premise of the VC model in terms of its values, intentions, and the mechanisms through which it operates—while also protecting inventors and creators.
Did we perhaps need a new type of “Chinese” wall, I wondered, to protect inventors’ sovereignty, while also rebalancing the inventor/investor dynamic in an investment scenario?
If so, then we’re considering an idea that is nothing less than reverse engineering traditional VC models and re-arranging the impacts of today’s capital raising process on inventors, creators, indeed, every stakeholder.
In doing so, I realized that such a rebalance of the inventor/investor dynamics in capital raising could positively affect every stakeholder and would, astonishingly, benefit other business sectors.
By reverse engineering the traditional VC model along with the introduction of the patent-pending Sovereign Revenue Trust Entity® or SRTE®, we open up new revenue stream opportunities—joint ventures or other creative forms of collaboration, for example, with hospitals, insurance companies and other key healthcare stakeholders—creating a virtuous cycle of wellness, creation and peacebuilding.
Healthier Dynamics
By creating healthier dynamics between our current trillion-dollar healthcare and insurance industries to better serve their patients, we all win. With an intentional return of our values to the core tenet of the medical industry, the Hippocratic Oath, we can give the current system a healthy reboot, creating new roots from which to rethink and reengage our current embedded and antiquated policies.
This tiny innocuous looking SRTE® kernel could potentially alter entire dynamics amongst huge industry engines in service to most every sector. It’s presence along with a critical mindset shift regarding inventor primacy coupled with solid policy changes could potentially alter entire healthcare industry dynamics. These insights could be exactly the right strings to pull regarding our healthcare’s ball of tightly knotted yarn.
Could this gordian knot slowly, effortlessly, and finally dissolve before our eyes?
And if it does, then two market sectors, the traditional VC sector and equity markets (NASDAQ, NYSE, etc.), which represent a ~$40-50 trillion engine could work in tandem with the SRTE® to decentralize the current system by creating of a new pathway to stop feeding the beast of institutional capital monopoly in favor of an empowered inventor community.
Of course, such a transition will require assistance by the legislative policy makers on Capitol Hill. I do plan to engage them at the appropriate time to create new policy regarding investor primacy as well as a redefinition of fiduciary responsibility to include protecting our inventors as much as our investors.
Five Steps to Honoring and Funding Our Inventors
Finally, I see five key choice points for us to consider, in order to create the potential to right humanities’ ship:
- We can begin to say no to the disrespect for creation, and for our inventors who bring forth that creation.
- Our inventors and visionaries can begin to say no to the old VC model that forces them to sell-out.
- Investors can decide that they no longer want to participate in this antiquated mindset, and the model that embodies that mindset, and
- Say no to supporting a system that potentially leads to the loss of personal freedom and national sovereignty.
- Some can also begin to say yes to the engagement of a new model which holds creation as its priority to assist in realigning our values.
These five steps provide a means to liberate ourselves from the very system that has represented a key part of human enslavement for thousands of years. It sends a powerful message, and it all begins with first honoring our inventors as our priority.
For more information about Barbara Guth and the SRTE® platform she is building, here is a link: SagesseSRTE.com.
For more information about Barbara Guth’s books on this subject, here are two links—one to her website and the other to Amazon.com if you are interested in purchasing her books.
Editor’s Note: Our guest author is Barbara Guth. Guth entered the fund-raising world three decades ago as part of the Viscogliosi led team that funded prodisc and early motion preserving implants. From that auspicious beginning, Guth has worked with a variety of entrepreneurs and young companies. As a venture capital insider, Guth sees how the system works (or doesn’t work) and has concluded that the system needs a re-engineering. Whether you agree or not (and we think most entrepreneurs would agree), her voice is certainly thought provoking and, in my view, refreshing. Please feel free to add your comments about Guth’s critique in the comments section below. — Robin Young, Editor
