For good reason, people are up in arms about the suggestion that venture capital firms will be regulated by the SEC or FINRA (see here or here or here or here).  While we are all for democratizing information about VCs, angel investors and startups, we do think these recent calls are overreaching to say the least.

ChubbyBrain is built around the idea and mission that this information should be better structured, more available and transparent, e.g. not available to a limited few who can afford multi-thousand dollar subscriptions to bloated information services providers.

Ultimately, increasing the availability of and efficiency by which such  information is available benefits investors, entrepreneurs, corporations, researchers, job seekers, bloggers, journalists, etc.   In the long-term, we believe that innovation which often happens at the boundary of different disciplines will emerge from bringing together diverse sets of information, people and perspective.

But opening up this information should be done within limits and in ways that are conducive to helping entrepreneurs, investors, academicians make better decisions or further innovation or our thinking about business, public policy, etc.

A Sarbanes-Oxley for VCs would be damaging to say the least.  For those who think it’s no big deal, talk to any public company CFO and they’ll tell you how non-trivial the requirements are (note: some of us have come from this world and know its costs).  All of the resources (people, money, time) to manage these band-aid policies are pulled away from things that are business-building - innovation, new product development, operations, etc and which lead to the big and small things that help us grow.

Opening up this information as part of some checklist of regulatory items is a colossal waste of time for the VCs and a distraction from the things we want them to do which is invest in high risk, game-changing companies and concepts.