When you consider how many VC-related sites try to give entrepreneurs an edge, you’d think that venture capitalists were freaking altruistic monks. 

AskTheVC is one example.  Even entrepreneus are getting into the mix, Venture Hacks is an example of that.  And, that doesn’t even include the cornucopia of VC blogs that chime in on everything from music, politics, and well, yes, business startups.  Don’t get me wrong, these are some of the better blogs out there, but, still… come on. 

Ultimately, it’s a reflection that VCs are not necessarily the best path to financing for entrepreneurs when money is cheap and digital dreams are great. 

When it comes to exploring alternative financing options, I think it’s very important to understand who you are and what you do to make the right decision, especially since despite all of the changes, when it comes down to the actual details of the financing, then the rules of engagement seem to be very “VC 1.0.” 

But that’s a different point.  When it comes to the best financing fit, you have to understand what you do, and what adds most value.

For example, if MySpace was not incubated out of Intermix, I don’t think it would have been what it is, I’m not sure Friendster would have become MySpace, but MySpace benefitted from a certain series of variables and being born out of Intermix was one major advantage.

By the same extention, Facebook did the right thing by not selling when it did (ain’t hindsight grand?) because its growth in 2007 has been nothing short of ferocious.  Having just launched classifieds, I think Facebook’s long-term legacy will be far greater than MySpace’s, and we all know that MySpace is part of culture and ingrained in many ways.

Am I saying that Facebook will be the next Google?  Well, in some ways, yes.  Mainly, in the way that many companies had a shot of buying it, did not and will regret it.  It’s not the next Google, mainly, in the sense that search is highly monetizable and social networks are not.  But the fact is that Facebook is worth a lot more today than it was when Viacom’s $800M, and Yahoo!’s $1B and $1.6B offers were turned down.  Will Facebook get more than $1.6B?  Who knows, price and value are not one and the same, but Facebook is worth more today than then, so if it turned down $1.6B, I think Facebook is well on its way to an IPO in 2008, as I’ve written previously.

Legend has it that Facebook’s Mark Zuckerberg retained 30% of the company by being able to get companies to submit term sheets, which he would then leverage to VCs to match.  And, match they did.  I have no clue what Facebook’s last valuation was, but in my opinion, it’s hard to think that Facebook is not worth somewhere in the range of YouTube’s sale.  I know, Peter Thiel says Facebook is worth $8B, but he might as well be on crack. 

CNET, one of the most valuable small-cap Internet companies with a large audience is worth more than $1B and less than $2B.  Bottom line, as an investor, do you prefer owning YouTube? CNET? or Facebook?  Different companies, indeed.

The point is, Mark Zuckerberg, in hindsight, did the exact right thing and today is in the driver seat.

I’m no Mark Z.  That’s for sure.  And my company is no Facebook.  As a network, Facebook needs to be media-agnostic.  Similarly, a service needs to be able to serve different clients.  But when you’re a publisher/producer, like I am, you have to be very careful and realistic with the kind of risk/reward offers that VCs make you, with those larger media companies make.

That’s all I’ll say now, but stay tuned.  I’m off to NYC for Streaming Media East to cover the shindig, meet some folks, and discuss some stuff.

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