Rewriting The Rules Of Venture Capital

To David Blech, rebel venture capitalist extraordinaire, the orthodoxies of his field are too stodgy. At first glance, venture capital may sound like a high-wire endeavor: VC firms risk their investors' money to fund startups. But the truth is that the VC community is a pretty conservative bunch. They prefer to parcel out equity investments piecemeal, a year at a time, depending on the outfit's progress. The payoff can take as long as seven years, until the company is mature enough to sell stock to the public.

That leisurely process is not for Blech, who puts big money into deals at the outset and extracts his profits as quickly as possible (table). The shy former stockbroker who heads Manhattan-based D. Blech & Co. has made himself enormously rich--and often unloved--by challenging the niceties of traditional venture financing. "I don't pay attention to my critics," says the 37-year-old financier, who has formed 15 companies and amassed an estimated $300 million net worth since he started a dozen years ago. "Some others aren't capable of competing with us."