Will it float or will it bob?

Today is likely to see the failure of another business-to-consumer web site. Dressmart.com aimed to offer business clothes to people all over Europe.

But this is more than another dot-doom story. Dressmart was backed by, among others, the Swedish government's pension fund.

The AP-Fund was described by one of Dressmart's other backers as "the main investor". They put in 35m Swedish Krona (E4.2m) of taxpayers' money. A silicon.com reporter got through to the president of the pension fund who rapidly put the phone down when he realised he was speaking to a journalist.

Underlying this is a serious question about the role of venture capital in the new economy. The sales pitch is that VCs offer not only funds but expertise and a network of potentially useful contacts for inexperienced businesses. In a world of partnerships and pro rata deals these can be invaluable.

The reality is VCs all too often offer as much help as you'd expect to get from a Swedish pension fund when selling Armani suits to men in London or Paris. The temptation must have been hard to ignore as newspapers filled with ever more ludicrous price rises for newly listed companies. How could a civil servant resist the temptation?

Investors must bring more to the table than just money. They must have an interest in and knowledge of the business they are buying into. Without this relationship they risk both their money and their credibility.

This gets interesting when a company fails. Backers rarely, if ever, discuss what they think went wrong or why they finally switched off the life support. Who is really to blame for a boo.com blowing $100m? Management, investors or both?

We should recognise dot-com failures as failures of investment rather than just a shadow over the management of the company.