Chapter 1: Christopher Columbus Was the First VC
If you think venture capital is a modern invention from Silicon Valley, think again. It’s actually hundreds of years old. In fact, Cyril Demaria argues that Christopher Columbus was one of the first great venture capitalists.
Think about his “pitch” to the Spanish monarchs. He spent seven years lobbying them! His elevator pitch was simple: “I’ll find a shorter route to the Indies, make you rich and powerful, and we’ll beat the Portuguese.”
That sounds exactly like a startup founder looking for funding today. It had all the classic elements of a VC deal:
- It was a high-risk venture.
- It needed external investors (the King and Queen, plus private backers from Genoa).
- It had massive potential returns.
- It was protected by “barriers to entry” (legal titles and exclusive rights to the route).
Columbus even negotiated a “carried interest” deal. He asked for 10% of all the profits from the new route and the right to buy shares in any future commercial ventures using it. That’s basically the 15th-century version of stock options.
The risks were huge. Columbus actually got his math wrong—he thought the Earth was much smaller than it is. But just like a modern startup that “pivots,” he stumbled onto something even bigger: a whole new continent.
This shows that the core of private equity hasn’t changed. It’s always been about pooling resources, taking big risks on innovative ideas, and having a long-term plan to create value.
In the next post, we’ll see how these historical “deals” evolved into the professional industry we see today.