One man's opinion on Venture Capital Basics

Early market

Making mistakes

There are two things to learn from making mistakes.

No guarantees

Milestones are one way to measure a company's progress. But just because you hit your milestones does not mean your investors will continue to fund you. Understand that things can change, the environment you were working in is fluid. This is NOT SCHOOL! Turning in homework assignments is no longer enough. Understanding the marketplace isn't enough. Being smarter isn't enough. Performance counts. And you're not being judged just against the competitors in your field. But against everything else your investors can put money in.

Marketing Survey of 1

There are many rookie mistakes that can kill off a young company. The marketing survey of 1 has led many people off a cliff, based upon the whims of a single customer. Long ago, I was dissuaded of the thought that I could ever be the common man. I don't know what he wants, and can never guess where he's going to go.

Mistake #1

In a move that will be known as mistake #1, I’m opening this post up for comment for 1 month. Comment on anything that will be said here, thrash my thoughts, or give me fodder.

Giving Back

I’ve joined the nonprofit I Do Foundation http://www.idofoundation.org/. I’ll make the money pitch for them, and ask for donations to this 501c3. Yes, this means all donations made to them are tax deductible.

Often Wrong, never in Doubt.

I was reading the WashingtonPost article on Google's IPO , and realized this attitude was pretty pervasive in the VC community. We KNOW that several, if not most of our picks won't be home runs, quite a few won't even return the initial capital. This is why we take so much care/time in picking the deals to invest.

Where are you?

It has been described that there are 3 stages in the life of a VC.

    1. Novice (Analyst)

        a. Everything looks good, the world is covered in rainbows.
        b. Numbers just go up.
        c. Best technology wins

Answers before the questions.

Path is more important than the answers

I've been in a few meetings, where I've had my own agenda, plans and goals already decided.

Down the Rabbit hole

I first started by reading Jerry Colona's 9 ways to scare a VC article on Inc. From there I read his bio, looked at his blog, and fell into a wonderful mess of knowledge, experience and advice by following the links to Fred Wilson's and Brad Feld's blogs. Do I agree with all of the points brought up? No. (Probably because I have some more learning to do).

However, I do believe that the 'market' does know more than any individual.

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