Steve Blank Discusses the Skills Required to Be an Effective Venture Capitalist - Page 3
If they are still interested in venture, have them come back as an associate and have them shadow deals, shadow board meetings…and then my radical suggestion was to throw them out again. Let them Found a company or at least be a Co-Founder of a company. None of that guarantees a successful VC with great pattern recognition skills…but it certainly would give them a career path that understands both the venture side and the startup side.”
1 Dose Of Depth + 1 Dose Of Breadth > 2.5
I shared with Steve that Rincon Venture Partners has benefitted from a blend of operational and traditional investment banking and venture capital experience. As an operating executive, I developed deep understanding of the strategic and tactical drivers of success in the worlds of robotics, medical devices, SaaS and Ad-tech.
Before I began my VC career, I was convinced my practical experiences were an adequate primer to success as an institutional investor. In reality, I did not know what I did not know. After partnering with Jim Andelman, Rincon’s Co-Founder, I realized that operational startup experience is only one piece of the VC puzzle. Consulting, banking and venture capital experiences result in exposure to numerous, disparate situations and therefore familiarity with more permutations than are seen by the typical operating executive.
Our portfolio companies benefit from the fact that Jim has participated in well over a hundred financing transactions and dozens of exits. This breadth of experience facilitates deal benchmarking. Knowing what is feasible and typical in a variety of situations, enables our founders to efficiently seek resolutions in the midst of competing and seemingly conflicting requirements. The ability to craft a complementary syndicate, utilizing terms which protect everyone’s interests, is not typically part of a startup operator’s skill set.
The ideal venture capitalist does not exist. As such, entrepreneurs are well served to partner with a venture firm that has a complementary Core Team comprised of operational and finance oriented Partners. Assuming the Partners are not strictly relegated to only working with particular portfolio companies, such entrepreneurs can benefit from deep operational expertise while also leveraging a broad library of transactional experiences.