And lately the news about Novell has made a sharp turn for the better. The company's share price is up, and its marketplace momentum is back. "We've realized that Novell needs friends to be successful," says Stone. "Things change so fast that we can't do it all alone. In the beginning, we were nervous because of our long legacy of bad deals. But we feel that we have the formula down now. Doing smart deals is our mantra."
Steve Jurvetson, 32, likes to boast that his firm, Draper Fisher Jurvetson (DFJ), has financed more Web companies in the past six years than any other independent venture-capital outfit. Many of the deals have been blockbusters. Microsoft bought Hotmail, a DFJ company, for $400 million. Yahoo! bought Four11 for $95 million. CyberMedia Inc. went public -- and was then bought by Network Associates for $130 million. "We don't sit around doing lots of deep thinking," Jurvetson says. "We get a sense of what will be a billion-dollar opportunity, and we look for companies. We get to closure before others see that opportunity."
Here are Steve Jurvetson's rules for Internet deal making.
1. Get fast or get lost. "At most venture-capital firms, partners gather for a Monday meeting to review the business plans that they've received and to make decisions on how to proceed. We don't wait until Monday. We make decisions on an ad hoc basis, and we take iterative steps throughout the week -- in person and by email. We've also engineered our due-diligence process to be minimal. You've got to close deals quickly, or else you'll miss out."
2. Bigger is better. "The '800-pound gorilla' in a category tends to get the dominant share of business and financial partnerships. Many advertisers and media companies don't want to spend time with small properties. And that makes it tough for new entrants.
"Hotmail, for example, was doubling in size each month, but it took six months to reach 1 million users. Until it reached that point, the company was off the industry's radar screen. By the time people came to realize that free, Web-based email was indeed a hot idea, Hotmail was adding 1 million new subscribers a month."
3. Mix work with play. "Lots of deals happen in situations that aren't 'pure work.' We play a weekl
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