Author: Tom Nicholas
Are you a budding VC looking for the top venture capital books to give you an investing crash course? Get your groans out of the way because this book isn't it – it's time for a history lesson.
This is a history lesson you'll need if you want to hone your skills and understand the nature of a volatile and challenging industry. Remember: limited learning is a dangerous thing, and a crash course will most likely lead you to, well, a crash.
In a sense, VC: An American History is a brutal chronicle of the history of failure. It documents the rise of venture capital in the U.S. over centuries and relentlessly exposes how the pursuit of wild gains at long odds has ruined naive investors. This alone makes it one of the best books on venture capital investing for beginners: you need to know what you're getting into. You need to know how many fall by the wayside.
Like all good histories, it's also an essential practical guide. Tom Nicholas is the William J. Abernathy Professor of Business Administration at Harvard Business School and knows his stuff – the book illustrates every type of mistake your predecessors have made and how these pitfalls are inviting for VCs and allows you to learn from them
At every level of a deal flow, there's an error waiting to consign you to the wrong side of history, and there's always an example of someone who has made that mistake before. As you read, keep track of every time an investor has gone wrong and consider why it happened. As in chess, "no wrong moves" is the mantra of investing.
The story is carried by Nicholas' likable tone and fascination with VC's relationship with the American spirit. It's also a fair analysis, giving credit to the unbelievable success stories that have emerged along the way. This is one of the best books about venture capital because it's both a sobering history lesson and an inspiring call to action – VC: An American History is mandatory reading for anyone in the industry.