There is a fundamental truth: Almost all ideas are wrong. It doesn't matter if they are your ideas or someone else's ideas. They are probably wrong. And even if they strike you with the force of brilliance, your job is to assume, first of all, that they're probably wrong, and then to assault them with … Continue reading Almost All Ideas are Wrong.
Statistically, startups mostly fail. We love to think of ourselves as great investors. But Venture Capital fundamentals still didn't change: Fund returns are driven by outliers, and returns are concentrated in few firms. All VCs are constantly evolving and refining their thinking, processes, conviction. That's why we write long investment memos: Not because be need … Continue reading Venture Capital: Preparing for Failure.
Sounds obvious. So I am puzzled when I get pitches where the basic parameters of investment returns are not met. There are many different types of venture capital investors. You should know which type of investor you are talking to. So here's one real example from last month: We're selling an edge appliance for IoT … Continue reading Pitch Clinic: VC Investments Need Hyper-Growth (D’oh!) — Excel Worksheet Attached.
A quick reminder on social media basics: It used to be that you used Twitter for witty one-liners, quick comments, or something you found or #overheard. These were called "Tweets". Reminder for all C-level executives, politicians, or public figures: No more. You are making statements, not tweets. Tweets are cute and playful things, statements have weight: … Continue reading Quick Reminder: Tweets vs Statements.
As VCs, we can voice observations, opinions, demands (which might or might not be met :)). We can assist, coach, or mentor the current CEO. But unless you are also a board director and -- together with all other board directors -- hire a new CEO, we cannot fix culture. Nicholas Pearce, on Dear HBR, … Continue reading VCs Can’t Fix Culture.
I remember one sentence from the many books I read while doing business in Europe, the Middle East, and Asia: Your relative power in a negotiation is your capacity to use resources to influence another’s circumstances. In 1962, Richard Emerson published Power-Dependence Relations. I found that Richard's focus on "In how many ways can I demonstrate my … Continue reading Negotiations: Focus on What You Don’t Know.
lindsey.a.elliott Every day -- silently, and without notice -- we cross invisible thresholds to who we are becoming. It explains that feeling of waking up and not recognizing your life, or how you got there. A disorientation I often feel in the craze of entrepreneurship. These words from David Whyte reminded me to take notice -- … Continue reading “Every Day we cross invisible thresholds to who we are becoming.”
As an investor, I am more interested in finding out where knowledge ends and where a discovery process starts. It's astonishing in how many pitches entrepreneurs avoid "I don't know" and instead suddenly change topics or point to a statistic where when asked they cannot explain how that would be relevant to the question. "I … Continue reading “I don’t know.”
The firm I work for has a fund-of-funds business -- we invest in what we believe are the very best venture capital firms. We have reasonable insights into fund performance: who is driving returns, and which sector is successful. Market perception, however, is driving by people who are the loudest, by content, and by marketing. … Continue reading Most Successful Cybersecurity VCs: A Quick Survey. (Part I)
