America Is Negotiating with Iran Like a Venture Capitalist |
Why understanding startup financing explains more about these negotiations than foreign policy theory
If there is one meme that sums up the mistake many make when thinking about the negotiations between the Islamic Republic of Iran and the United States of America, it’s the one best expressed by Mir Mohammad Alikhan’s description of the negotiating teams. He writes, “Irani: PhD, PhD, PhD, PhD, PhD,” to contrast with the other team: “American: Real Estate Developer, Real Estate Lawyer, Venture Capitalist.” Most people who read the tweet used it to make fun of the Americans for being outwitted at the negotiating table, echoing a sentiment shared by many if not most policy analysts and politicians. As someone who has experienced both the policy and private equity worlds (of which venture capital or VC is a subset), I’m pretty sure that they are wrong, and it is the Islamic Republic which has been outgunned.
Because to understand the American strategy, one needs to understand the way VCs negotiate, and why they are so regularly able to take advantage of the PhDs leading many of their portfolio companies. Specifically, one needs to understand one concept that I’m surprised is missing from most of the mainstream analysis on the Iran War: Runway.
Runway is the term used by people in the world of venture to describe the amount of time a company has before its resources run out and it becomes distressed. Running out of runway is one of the ways that companies with tremendous potential and world-changing technologies can die, no matter the level of commitment of........