What's the Why?

Delivered November 1 @ 5:00pm ET

Table of Contents

• The Doriot Roadmap

• Venture Alchemy - This Week’s Discussion

• What’s the Why?

Happy Friday everyone! My name is Gerry Hays, and I’m the Founder of Doriot (pronounced: dor-ee-oh).

I’m actively in the venture game as a Founder/CEO, investor, researcher, inventor, author, game designer, and professor. I’ve built companies and developed a global venture portfolio entirely from the great state of Indiana, all while teaching over 6,000 undergraduates and MBAs at Indiana University, as well as in Croatia, Hong Kong, Slovenia, and Singapore.

Through Doriot, I’m devoting the remainder of my professional career to democratizing venture.

The Doriot Roadmap

According to Ray Dalio, "capitalism needs reform as wealth inequality in the U.S. has become a national emergency.” I wholeheartedly agree.

But if we are going to reform or reimagine capitalism, we need to make venture - the very genesis of wealth creation - permissionless for both founders and investors. This, of course, begins with education to close the gap of asymmetry.

That’s why we launched world-class programs such as Fantasy Startup® and the QAI - Qualified Accredited Investor certification program. To date, more than 12,000 individuals across the globe have accessed our venture education programs.

But education alone isn’t enough. New paradigms and platforms are also needed - ones that don’t require big checkbooks and elite connections.

Thus, utilizing existing SEC regulations and structures, we’ve designed a new form of venture called Venture Staking™, a patent-pending system that give non-millionaires the ability to bet on elite founders at ground zero valuations with the same downside protection structure as the largest institutional investors.

As part of this new paradigm, all participants in Venture Staking™ (founders and investors) will be educated on the practice of Venture Alchemy: a disciplined process that transforms bold ideas and capital into valuable outcomes through the convergence of mindset, strategy, and execution. It’s a proven pathway to achieve returns, first utilized by Georges Doriot 80 years ago. Through Venture Alchemy, Doriot earned 22% annualized returns over a 20-year period.

Thus, each week, I explore a component of Venture Alchemy along with key lessons on the business of venture as key components to the Democratize Venture movement.

If you’re enjoying this newsletter and think others in your network would too, I’d be grateful if you forwarded it along and encourage them to subscribe. And, with 10 referred subscribers, I’ll autograph a copy of my first book, the First-time Founder’s Equity Bible and ship it to you!

Venture Alchemy - This Week’s Discussion

"I have learned over the years that when one's mind is made up, this diminishes fear; knowing what must be done does away with fear"

This week’s quote is from Rosa Parks, who refused to give up her bus seat to a white man in Montgomery, Alabama, sparking the civil rights movement in 1955.

What’s interesting is that most people believe this was a spur-of-the-moment decision, made spontaneously in a tense moment. But that’s not the case. In fact, Ms. Parks was deeply active in the civil rights movement long before that day, and she understood that the movement needed someone to take this pivotal stand. She had to “make up her mind” well in advance, fully aware that she could be putting her life at risk. Ms. Parks lived with that fear for weeks, perhaps even months, before the event took place.

And that’s what’s so powerful about this story - not just the event itself, but her ability to endure what I can only imagine were incessant, fearful thoughts in her mind between her decision and the moment she said “No”.

How did she muster the courage? In a modern Venture Alchemy context, Ms. Parks found a purpose bigger than herself (Mindset), became involved in and helped foster a community around this purpose (Strategy), which gave her the strength and support to endure fear and uncertainty to achieve a historic outcome for humanity (Execution).

What’s the Why?

It’s that exciting time again in my Venture Capital and Entrepreneurial Finance classes when my mostly senior students stop studying and start playing. By that, I mean The Venture Capital Game—a 6-week simulation that teaches students the entire venture lifecycle, from idea to exit, including negotiating term sheets with Series A, Series B, and Acquisition companies. I’ve been told by hundreds of students on end of class reviews that the Venture Game is one of the best experiences at the IU Kelley School of Business. It’s super intense and fun.

The game begins with every student standing up to give a 60-second pitch. Everyone else in the room votes on the top pitches, and the top vote-getters become the Founders. All other students then must join one of the Founders leading a team (a chaotic day).

Currently, each team is in the process of putting together a 5-minute pitch (5 slides only) covering the problem, solution, market, why now, and economic argument. Demo Days happen next week, and to advance as a startup team, a team must rank in the top 75% of capital raised by Angel Investors (with all students in the class acting as Angels with a set investment budget). The bottom 25% of teams fail (i.e. raised the least amount of capital) and become Series A Venture Funds for the next round.

This is the first time most of the students are wearing the hat of entrepreneurs trying to raise capital to bring an idea to market, or Angel investors having to decide who to invest in, which in and of itself is a huge learning victory. But the game is just getting started. 🤣 

This past week, each team reported progress on their 5-minute pitch. And, as expected, teams felt uncertain about their pitches - not because their ideas were lacking, but because they weren’t digging deep enough to understand the “why” any of this matters. This was the primary point of teaching during my coaching, because if students understand the importance of digging deeper to get to the real "why," it will lead to better decisions throughout their lives and give them the agency to think bigger and bolder.

The “why” digs down to the purpose, and we all want to do something purposeful in life because it offers an infinite amount of energy to persist. The high level point here is that Founders driven by a strong "why" are much better candidates for funding than those motivated solely by external rewards such as money or status, regardless of talent and educational background. And it will become abundantly clear to the students during the Demo Day presentations which teams found their “why” (high level of energy and enthusiasm) and which didn’t. I can’t wait to see which startup teams advance!

(Incidentally, I’m considering running an in-person or zoom-based version of the Venture Game for the general public in early 2025, limited to 36 players. If you’re interested in playing (and you can invite friends), answer the poll below and you’ll get a link to join the waitlist)

Have a great weekend, everyone! We’d be grateful if you could forward this newsletter to anyone in your network and invite them to the Democratize Venture party! Let’s make Venture permissionless!

Sincerely, -gerry ([email protected])