Earlier this week I had to prepare the CEO of one of my venture companies for a presentation to an angelforum, the latter being a somewhat informal gathering of successful entrepreneurs who have made their money in primarily technology and are now willing to drop some of their wealth into new starting companies. Preparation for events like this is rigorous; you’re given ten minutes for the pitch and can only have a PowerPoint of ten slides so you better be very precise about why you’re such a great investment opportunity. Investors want to know everything about your history, product, team, development plans, how you can capture a slice of a crowded market and finally: what the exit strategy will be (IPO, take-over, merger), all in all a lot of information given the time allotment you have. Tough questions follow, and some of them are next to impossible to answer, you generally have a very good idea about your technology and the people that will build and market the end product, but market forces may severely disrupt any well-defined plan. That makes it hard to convince critical and somewhat condescending angels, predicting an exit strategy is something that falls entirely beyond the scope of what one can reasonably forecast. That’s one of the reasons why I long ago abandoned revenue projections (utter nonsense, really) and restrict myself to very conservative cashflow projections for 12 months only. It should also be emphasized that many technology deals end up in a completely different space then where they thought they were going to be, only recently a company here in town that started out as an open-source developer was acquired for a sizeable sum just because they changed gears and came up with some great anti-spam software. In summary, unique concepts and committed people will probably end up somewhere in the success zone, but it is an extremely difficult undertaking to try and convince someone of that impending future accomplishment today.

Why am I telling you this? Because it goes some way to explaining the lack of clarity regarding the longer term plans for Iraq. Dan Drezner and Kevin Drum have a hard time figuring out why the Bush administration is not unequivocally clear as to why we are in Iraq and for how much longer we are going to be there. In a way, Bush has been able to convince his investors this week as Congress chipped in a healthy $87 billion dollars so they at least seem to have bought into the deal and the various milestones along the road. They also must have some notion of an ultimate exit, if not they’re not representing the US taxpayer very well.

If you use the venture analogy then it is clear that from the outset Bush had a clear idea of what needed to be done, which was enforce previous UN resolutions lest the civilized world would resemble an ineffective group of chattering nations without the resolve to execute any of its threats. It all came against the backdrop of the war on terror and the likelihood that Saddam had developed weapons that could easily be acquired and used by terrorists. Good case, and a compelling one if well pitched which I believe it initially was. The Bush pitch ran into trouble when he violated a basic rule of angel presentations, he threw in a few extra PowerPoint slides to bolster his case when he did not directly get his way with the UN and domestically some critics started to raise their voices. Not a good move, since his case was more than persuasive in the first instance and if you can not convince those that you are pitching to, do not try to convince them with some last minute notions that have never been on the table before. The al-Qaeda link springs to mind as does the notion of freedom for the people of Iraq, the latter being especially unintelligent for if it was a valid argument then coalition forces would have at least fifty other nations to liberate. The other instant reason was that it would take the wind out of Arafat’s and Hamas’ sails in their war against Israel. Nonsense, if that were so then America could stand accused of directly interfering in a conflict in which they were also trying to mediate. While I would still agree to the logic of the latter points that were thrown in at the last minute, they did not really stand the test of public scrutiny, especially not when they were taken in context with the other basic reasons, it left many confused and was fodder for the critics.

I have not figured out a timeline, but it seems that shortly before the war the idea of democracy in Iraq started to gain momentum, with a view that it would open up the corrupt and stinking pit that was rapidly turning the Arab world into a mass recruiting ground for terrorists. Rollback terrorism by implementing democracy, if Iraq falls, Syria would follow and so would Saudi-Arabia etc. This was a good argument but one that should have been made in conjunction with enforcing UN resolutions and the threat of certain arms falling into terrorist hands. In other words, that slide should have been part of the Bush pitch right from the very start. But it would be a tough one to sell and the administration must have thought that it would be better to bring out the facts selectively at a later stage in order to not unnecessarily disrupt the mood among the listeners. A pretty serious mistake which is why they have to work so hard now to fix past mistakes. To go back to my analogy, they are now putting out PowerPoints every week, not only to remedy mistakes in past communications but also to bring reassurance as the situation on the ground keeps changing everyday.

My basic contention is that the strategy for Iraq was valid but that the way in which the Bush team formulated, planned and communicated it was flawed. They absolutely have the right ingredients to make it work (the military apparatus, the funds and the vision) and they are on the right track. When many Democrats indicate that on grounds of national security they will vote for Bush, and when we realize that just like 1939 was not 1914, Iraq is not Vietnam, Bush continues to have a phenomenal amount of capital he can draw on. Knowing that he could and should be more specific, within the confines of national security, about the strategy and the various milestones along the way. But like any venture deal, don’t ask about the exit strategy, it’s just too early to tell and maybe Bush and his team should have been a bit more upfront about that particular aspect.