Venture Capitalists at Work – Part 3

by Scott Edward Walker on September 6th, 2012

INTRODUCTION

This is the third and final part of my series on the book Venture Capitalists at Work, which is a solid collection of interviews by Tarang Shah of certain highly-successful investors.  I have again set forth below some nuggets for entrepreneurs; and, in case you missed them, you can check out Venture Capitalists at Work – Part 1 and Venture Capitalists at Work – Part 2.  Many thanks, Scott

KEVIN HARTZ, Co-founder and CEO of Eventbrite

“So, when you asked me where to focus on identifying promising startups, I would definitely say it’s always the function of team dynamics, the founding team, and the team built around the founding team as an extension of the core DNA.  That’s the most important factor in the determination of success.” –Kevin Hartz (p. 305)

“I subscribe to the theory that it’s really hard to pull it off as a single founder.  As a sole founder, you just don’t have somebody to bounce ideas off.  You don’t have somebody to pick you up when times are tough.” –Kevin Hartz (p. 309)

“Good decision making skill, surrounding themselves with smart people, strong work ethic and intelligence is at the core of what the Silicon Valley is all about.” –Kevin Hartz (p. 311)

ERIC HIPPEAU, Partner at Lerer Ventures

“Very rarely do you see successful companies fail for lack of financing.  If they are successful at hitting the key metrics that they should be hitting, they will raise financing.” –Eric Hippeau (p. 316)

“You have to be results-oriented.  If your ego gets in the way, you are not going to get results.”  –Eric Hippeau (p. 316)

“[T]here are a lot of misses and a lot of miscalculations…that is why it’s called venture capital.” –Eric Hippeau (p. 323)

ROBERT KIBBLE, Managing Partner at Mission Ventures

“[I]t is tough to get your arms around the market opportunity other than having almost a sixth sense that it stands a good chance of being compelling in a short time frame.” –Robert Kibble (p. 355)

“The best type of entrepreneurs…are the ones who want to change the world.  They have a real passion.  They want to do something that really matters.  It’s not the money that matters to them.  They would like to make some money, but that’s not the real motivation.” –Robert Kibble (p. 358)

“Great leadership to me is motivating a whole team of people to work flawlessly.  And by flawlessly, I mean without a lot of friction.” –Robert Kibble (p. 361)

KEVIN MCQUILLAN, Co-founder and General Partner at Focus Ventures

“Just look at the numbers in the venture business.  There are four hundred to five hundred active venture funds.  There are basically twenty-five that make any money.”  –Kevin McQuillan (p. 387)

“At the end of the day, it’s the management teams that matter, and sometimes investors forget that.  They are there to help and give advice, but not run these companies.” –Kevin McQuillan (p. 387)

“If you are trying to sell a company, you’re not going to make very much money.  Again, it’s all about creating value and making a valuable asset that [a] lot of people want because, like anything else, the more competitors that want to buy your assets, the higher your price is going to be.” –Kevin McQuillan (p. 391)

MIKE HODGES, Managing Director at ATA Ventures

“In every successful company, there is someone who is strong enough to say no…. The point is, it is very easy to say yes to all these things that are coming at you.  Most people don’t like being the bad guy.” –Mike Hodges (p. 399)

“Sometimes it isn’t the smartest guy that wins, it is the guy with the best vision in a newly emerging market and somebody who has the passion to work twenty-four hours a day, seven days a week at little or no pay to make this thing work.”  –Mike Hodges  (p. 399)

“[Have] no fear about trying stuff.  The environment today allows and rewards experimentation.” –Mike Hodges  (p. 400)

VISH MISHRA,  Partner at Clearstone Venture Partners

“You start out by identifying a pressing need that exists in the marketplace.  Nobody switches products or services or suppliers just for some minor inconvenience or minor cause.  People will say, ‘Gosh if only somebody could solve this problem, I am prepared to do anything’.” –Vish Mishra (p. 431)

“I am looking for the honesty in the entrepreneur – that he is totally in touch with himself.  Good entrepreneurs tell you, ‘I need help here, here, and here.  Now it is quite obvious I don’t have all the answers, but then give me the money and I will learn the answers’.”  –Vish Mishra (p. 432)

“B players have to have C and D players around them to say how fantastic they are, how good they are.  The B players show up every day to say, ‘I’m the boss’.” –Vish Mishra (p. 432)

 RANDY KOMISAR, Partner at Kleiner Perkins Caufield & Byers

“[I]f you assume that whatever plan you start off with is wrong, do you have the perseverance and dedication to get it right?  Because that is the journey of entrepreneurship.  The journey of entrepreneurship is not one of simply executing against a great idea.  That happens very, very seldom.  What we really find more often, of course, is the notion that it’s a winding road, and you’re going to have to have the commitment to get yourself from point A to an undetermined point B.” –Randy Komisar (p. 444)

“[T]he wink-wink-nod-nod secret is that life’s value is the journey.  It’s not about what you accomplish, it’s not about whether you succeed…What really ultimately matters is, are you engaged with life?  Are you breathing it in, are you enjoying the adventure that you have the privilege of waking up to every day?  That metaphor is very much the entrepreneurial metaphor.” –Randy Komisar (p. 445)

“I see a lot of people come in with a strong sense of purpose who are inflexible.  And as much as I may really resonate with those people and their passion, I am leery about entering into this journey with them.  I am concerned that they won’t have the flexibility that is going to allow them to discover the best plan.”  –Randy Komisar (p. 446)

“You know the adage, A players hire A players but B players hire C players.  I find that to be very, very true.  So, hiring is critical.” –Randy Komisar (p. 449)

PETER WAGNER, Partner at Accel Partners

“When you have one of those great founders or founding teams, that is visible very quickly….What comes through is the clarity of vision, and the ability to communicate it and get other people excited about it.  That is a large part of what being an exceptional founder is, and that comes out in the first meeting.  –Peter Wagner (pps. 465-466)

“The entrepreneur needs to have a proactive vision that they are driving ahead with.  In some cases, this requires [a] certain amount stubbornness.  Coupled with it, though, is an ability to interpret feedback from users and from the market to modify that vision.  It’s a delicate dance.” –Peter Wagner (p. 468)

“The market doesn’t have a frame of reference, so how you interpret the signals you get from the market is key.  That is the essence of the great product-oriented entrepreneur.” –Peter Wagner (p. 468)

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