Steve Brotman ’90 was a self-described “computer geek” early in life, learning how to program in middle school on early computers.
He also dabbled in entrepreneurship at a young age, teaching kids to program and renting out his computer for $5 an hour.
Once he arrived at Duke, he majored in economics, but still fed his love of computers by taking several computer science courses.
After graduation, Brotman worked for about a year as a programmer for a consulting firm. He said he had “too much ideation” for the type of programming the company was looking for, so he left for law school.
After his first year of law school, Brotman realized the law didn’t excite him. So he began to go to business school, as well.
While in school, Brotman held a lot of different jobs, including working for a commercial bank that wanted to start a venture fund. He learned a lot about venture capital in the early 90s, he said, and it was an idea he became obsessed with.
“I just felt like there was a way to contribute to society by helping our companies do better,” he said.
While Brotman was working at the bank, he saw two small companies go public. One of them failed, but one went on to raise money – a process he found dynamic and exciting.
Knowing that he eventually wanted to become a venture capitalist, he moved to New York City with one year left of school, transferring from Washington University to Columbia.
In his final semester of school, Brotman signed up for an entrepreneurship class, where he got the idea to start a catalog catering to senior citizens, who he saw as a quickly growing and underserved population.
But when he asked his grandmother to send him all the catalogs she received, he found stacks and stacks of catalogs. When he questioned her about it, she said she didn’t buy anything from catalogs.
“I was crushed,” he said.
But then a guest speaker came to his entrepreneurship class, telling them, “The internet is going to change your life and the whole world.”
Brotman took those words to heart, and during an assignment in which he was supposed to develop a business plan for the internet, he came up with an idea that would become AdOne Classified Network.
AdOne Classified Network helped small and midsize newspapers put their classified ads online by upselling online ads for an extra fee. It became one of the first businesses making revenue online and allowed people to search ads nationally.
The company was acquired in 1999 by a newspaper consortium that included Hearst and Scripps.
In 1998, Brotman started in on his dream of becoming a venture capitalist when he raised $4 million from friends and family to found Silicon Alley Venture Partners.
He made his first investment — $400,000 to chat software company LivePerson, which went public in 18 months.
Now, Brotman is a managing partner at Alpha Venture Partners. The firm helps smaller venture capital firms that don’t have the money to do the best deals.
For example, Brotman explained, if a smaller venture firm invests in a company at seed stage, it might be limited when it comes time to invest in additional fundraising rounds because of rules that may limit how much of a firm’s fund can go into one company.
That’s when Alpha Venture Partners steps in. They partner with smaller venture firms that have a right to invest in companies, and the two firms split the profits.
“We’re kind of a venture capitalist’s venture capitalist,” Brotman said, adding that this model lets him crowdsource the best opportunities with people who have already made investments in these companies.
When Brotman moved to New York, he didn’t become a venture capitalist right away – instead, he got a job at Bear Stearns, which he wasn’t happy with because “it was about as far from venture capital as you can get.”
But Brotman said he is glad he held so many jobs because diversity of experience is important to be a venture capitalist.
He also keeps his law school rejections to remind himself that failure is OK and that there is just as much meaning in rejections as there are in successes.
“If it’s something you really want to do, you’ll find a way,” he said. “You eat, drink and sleep your dream, whatever it is, and it’s going to happen.”
To learn more about Alpha Venture Partners, click here.
To read about more Duke entrepreneurs, click here.
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