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came up between us with the right answer,” Grosfeld said. Both were excited about Napster, but their minds didn’t meet on one issue. The more-cautious Grosfeld wanted to cut a deal with Napster first, which would establish what their stake would be, what role Lilienthal would have at the company, and what would happen to both of those things if venture money came in. At a minimum, they should set a commission for bringing in venture funding if that meant they were forced out as a result. But Lilienthal was fired up to act fast, and he thought he could trust the venture investors he had in mind to do the right thing. “Let’s get it done as quickly as possible,” Lilienthal told his partner. Later, he said Grosfeld “ultimately had the right idea—cut a deal with them first.” But securing the commission wasn’t important for Lilienthal, since he didn’t plan on getting involved unless there were deeper pockets than Grosfeld’s.

Against Grosfeld’s advice, Lilienthal called John Backus at Draper Atlantic in Reston, Virginia. The small venture firm was the obvious choice for several reasons. One, Draper’s partners prided themselves on moving quickly. Supportive quotes from entrepreneurs on the firm’s web-site included one praising it as a VC firm that moved “on Internet time.” A second reason was the firm’s ties to Silicon Valley, through the stake in it held by the bigger venture firm Draper Fisher Jurvetson, backers of Hotmail and Sierra Semiconductor Corp. Most important, Lilienthal had earned Backus’s trust. Backus had offered to fund Lilienthal’s Nascent, and Lilienthal had turned him down, saying that he was likely to sell the company soon. That had spared Draper the hassle of a short-term investment.

In three days, Parker put together an outline of Napster’s plan, and Lilienthal did minor editing. “The idea was, this was a user play,” Lilienthal said. “We get as many people to use it as possible, then sell them ancillary stuff like concert tickets and music. Let’s go after 10 million users. Then we’ll figure out what to sell them.” Parker and Lilienthal went in to meet Backus and Draper Atlantic managing partner Jim Lynch. “They loved it. They got it right away,” Lilienthal said. The Draper team said that there might be legal problems, and each side said that it would study the issue before anyone committed to anything. But once again, no one felt like waiting. After just a few days, a meeting was set for the Draper men, Grosfeld and Lilienthal, Fanning, Shawn, and

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