“Idealistic” isn’t a word commonly associated with venture capitalists. But Brian Biniak, founder of the new wireless venture-capital firm Provenance Ventures L.L.C., believes there is a business case for making the world a better place.
“Some people complain about it, and I decided that I needed to do something about it—look at my skills, look at what I’ve been able to accomplish and look at ways that I can apply those skills to making a difference,” Biniak said.
Biniak has been involved with Vivendi Universal’s wireless subsidiary Moviso and helped shape and lead the new media division of American Greetings, which now sells its products through more than 45 wireless carriers and more than two dozen Web sites. He also is a member of CTIA’s Wireless Internet Caucus Leadership Council and one of the two leaders of the WIC Content Action Team.
Provenance, which Biniak said will focus on “technologies that are going to benefit society in some meaningful way,” announced its first investment in September: a mobile publishing company called Jacked. Biniak said that Jacked fit into Provenance’s do-good mentality because it opens up the opportunity for consumers with wireless phones to have a larger voice in broadcast media, via citizen journalism.
“The phone is one of the best production tools, where you can be a photographer and you can be a cinematogpher and you can be a recorder of audio and create text,” Biniak said. “You’ve basically become a one-man production studio, with the ability to get your content out within seconds after you create it and to take that through a number of very influential channels.”
And while venture-capital companies are increasingly doing later-stage investment and looking for a swift return on their money, Biniak is taking a different tack.
“I’m taking a long view,” Biniak said. “If I’m investing at a seed or pre-series A investment stage, I don’t expect a return for quite some time. A lot of folks that are looking for a quick buck; they want to build to flip.”
But he said, starting a company with one eye on an exit strategy doesn’t necessarily promote the kind of management that can get a business through tough times. Biniak remembers times when he and other startup execs went without compensation because things were so slim.
“The guys that are just looking for the quick hit, at the first sign of trouble you’re not going to see those guys roll up their sleeves and make the sacrifices that the company needs to make to get over that hump,” Biniak said.
Venture capital, Biniak said, was relatively slow to recover after the dot-com bust—but then, “in the wireless space, things started to heat up and then the floodgates came open with social networking and then it just went crazy.”
However, he said, “you’ve got dozens of investments in businesses that are basically the same thing with a different name,” and that companies which are one-trick ponies will have to have “some flexibility with [their] platform or application to move in different directions, especially with the rate at which technology is changing and consumer habits are changing.”
Comparing the venture capital world to surfing, Biniak add that “part of this business is chasing the big waves. And if you’re not afraid to do that, it’s fun.”
