Fred - it would be kind of cool if you had either a contest, or a charity auction type thing, where a startup that you are not associated with could get you to come and hit them with questions for a few hours. I know you might not know their product or their industry, but I'm guessing it would be a great experience for the company, and perhaps an opportunity for you to expand your knowledge base... maybe you could target non-traditional companies or startups from the inner city or rural areas; give people running an operating company a chance to experience the mind of serious investor, people who might not otherwise ever have that chance... Josh
fredwilson
· 4 months ago
Hmm. Good idea. I'll have to chew on it
Mark Essel
· 4 months ago
A day in the life of tech investing VC allstar. Since I've got value on my mind all the time now, I wonder if any of these brainstorming sessions can be filmed for documentary purposes. I happen to have a film production guru of a cousin if you consider it.
Of course the film would come out later as not to interfere with the developments but it could be both a potent learning tool for budding entrepreneurs, venture capitalists, and a powerful PR/marketing venue for portfolio companies hitting a different segment of potential users.
fredwilson
· 4 months ago
It sounds like a distraction in the first meeting. They webcammed the second one to the remote offices so it may have been recorded
Mark Essel
· 4 months ago
Hmm ok there's the tradeoff of providing value to your startups versus the fairly awesome info that could be shared. Maybe just document later meet ups or specific segments, no need for constant survellience.
I guess it would be too much of a real vc world publicity fest and folks would be less likely to share or risk saying something "dumb"
DaveinHackensack
· 4 months ago
Did you ever see Startup.Com? I bet those guys regret letting the cameras in. Great documentary though. One of my favorite parts is when the entrepreneurs get out of a meeting with Kleiner Perkins (if memory serves) and one of them says something like, "those guys just don't get it".
ShanaC
· 4 months ago
Noted as something to watch.
DaveinHackensack
· 4 months ago
I'd be interested in hearing your thoughts after you see it. Maybe it will inspire a post on your blog?
ShanaC
· 4 months ago
Now I need to find the movie. Where am I going to find this movie, Dang you Hulu.
Rob K
· 4 months ago
Fred- Great post. I liked it so much I left the venture business and became an operating exec.
fredwilson
· 4 months ago
I can certainly understand why
Paul Walsh
· 4 months ago
I agree. I met with my early-stage investor, Paul Birch yesterday to walk him through our latest designs for Wubud. It's important that investors take a proactive approach to staying on top of things, as it's easy for entrepreneurs to forget to provide regular updates - which provide confidence in your ability to deliver - especially when things slide.
Kelly Taylor
· 4 months ago
Hey Fred, it seems like VCs are always onsite at portfolio companies, investors days, in airports or at big meetings (at least, the ones I follow on twitter, etc).
I've always thought a VC's office is a place where they visit once a month to regroup. In fact, I have been fascinated at how many VCs that live very public lives (blogging, tweeting, writing columns for magazines, etc) are able to keep up with day to day work. I'm curious how inaccurate that perception is. Do VC's offices sometimes have a 9-5 vibe?
fredwilson
· 4 months ago
My most typical day starts at 5am and goes to about 6/7pm
In that 'typical day' I spend from 8am to 6/7pm in my office booked in back to back meetings. Sometimes I'll do 10 meetings in one day
Kelly Taylor
· 4 months ago
Wow! I can see why visits to Boulder for a day or two are so nice for you guys.
Arvind Ashok
· 4 months ago
great post. One question, when do you 'think', and do you have a process for it? I guess what I mean by think is about future directions and more importantly about re-assessing whether something is right or if a drastic change has to be made i.e. we need to re-think this from the beginning or from another perspective.
fredwilson
· 4 months ago
I tend to think when I blog early in the morning
theprivateequiteer
· 4 months ago
I had a bit of a rant about this yesterday from a private equity perspective. You simply can't develop a true appreciation for most markets and businesses from behind a computer screen. The world awaits us all and human interaction is much more useful than many private equiteers give it credit for.
When I was joining my second board back in '91 or '92, the entrepreneur made me spend a week working at his company before he'd take any advice from me
Part of that was I was young and green and guilty of all things young green VCs do
And part of it was I didn't really get his business until after I'd spent a week there
It was a great lesson for me at a young age
Derrinyet
· 4 months ago
Wow - working at a company for a week seems like a great way to assess entrepreneurs' character too: how do they treat the people they're *not* asking for money?
linneageiss
· 4 months ago
I like to balance meetings that I have in the office where someone comes to me with enough meetings where I am the one doing the traveling. It helps mentally get me away from the pace of the office, it gives me a chance to really focus on who I am meeting and why, and it also helps remind me that people invest a good amount of time in coming to my place. Plus, I always feel you get a better sense of who a person / company / team is by seeing their natural habitat.
Some weeks this works better than others, and as you mention, I always wish I could be doing it more.
fredwilson
· 4 months ago
Totally agree. If we could teleport, I would do most of my meeting onsite at the company including pitch meetings
bfeld
· 4 months ago
I'll let you try my portable teleportation machine once it arrives. The company that makes it (TimeTravel, Inc.) is having a little difficulty with the recursive portion - the part that lets me take the machine with me to wherever I teleport so that I can teleport back home with it when I'm done. I expect that part to be ironed out around 2025.
fredwilson
· 4 months ago
Don't laugh at me!
bfeld
· 4 months ago
I'm not laughing. Just fantasizing.
fredwilson
· 4 months ago
Me too
fredwilson
· 4 months ago
Me too
fredwilson
· 4 months ago
Me too
kidmercury
· 4 months ago
i believe extraterrestrials teleport and time travel by going in out and of dimensions. if you're looking to get in touch with some extraterrestrials, check beneath the denver airport. be careful, though.
bfeld
· 4 months ago
I prefer to hang out with them in the mountains around Boulder. There are plenty of them there.
bfeld
· 4 months ago
I prefer to hang out with them in the mountains around Boulder. There are plenty of them there.
Mark Suster
· 4 months ago
Totally agree, Fred. Great post. Since I'm new to VC (2 years) it is more naturally who I am and I think surprises people. I spent many years as an entrepreneur so traveling to other people felt normal. I think many companies I'm looking to invest in are surprised when I want to come to their offices. I learn so much more about the company when I see their digs, meet the whole team, get a sense for the culture. I can't imagine building relationships any other way. And people are surprised at how many events I go to - even the non-sexy ones. I can't imagine sitting in my office - that's for Mondays ;-)
fredwilson
· 4 months ago
Well there is something about partnership dynamics that you get from hanging out with your partners regulalry. Its a balance for sure
Mark Suster
· 4 months ago
Fair enough. I tend to do a offsite company meetings in the AM & late afternoon and am in my office in between. It helps obviously that LA is such a big market that I can easily meet with interesting companies most days of the week and still spend time in my office. The informal meetings in the GRP hallways are no doubt valuable. But I do come across many VC's that love to have all the companies to visit them. I think something gets missed that way.
fredwilson
· 4 months ago
Totally agree. Its a balancing act between the two
fredwilson
· 4 months ago
Totally agree. Its a balancing act between the two
fredwilson
· 4 months ago
Totally agree. Its a balancing act between the two
Michael Shafrir
· 4 months ago
Back when we were 10 or so people, our CEO brought in a lot of our angel investors every month or so. Being able to listen to WHY they invested in our company was incredibly valuable to young employees like me. And as you said, they would then stick around for an engaging Q&A. I highly recommend this approach to all startups. It's less practical now that we're ~300 people but I still remember those sessions and am still in touch with a few of our original investors as a result.
fredwilson
· 4 months ago
10 ppl to 300 ppl? It sounds like you are doing something right in your company!!
Michael Shafrir
· 4 months ago
Sorry, should have hyperlinked my name -- I'm at TheLadders. And yep, a lot has gone right!
fredwilson
· 4 months ago
Great company. Tough market this year but hang in there. Things will get better
Christian Brucculeri
· 4 months ago
Thanks for the excitement today. This was better than coffee.
fredwilson
· 4 months ago
Don't be ridiculous. Coffee is up there with a few other vices. Can't be beat
jasonspalace
· 4 months ago
another great point for why it is important that entrepreneurs and investors choose each other wisely, though for many i am sure the choice is more one sided (i imagine there is a scarcity of good deals in this economic climate). it seems there is synergy between you and your portfolio companies, which i am sure makes the path to profitability that much better.
Mihai Badoiu
· 4 months ago
Interesting, Fred. But how many VCs are technical enough to do this?
Both product and design discussions require some technical skills. At Google, new PMs are now required to have at least a science degree.
fredwilson
· 4 months ago
i would not make a good product manager, at google or anywhere else but i see a lot of products, i use a lot of products, and i have a good sense of what works and what best practices are
so i can help our companies in that way
i think many of the best VCs are good at exactly that
farhanlalji
· 4 months ago
I like the idea of you going in to the companies on your portfolio and giving them feedback, if I ever make it out of the big company I'm in today the next gig will definitely be a company I start, and any investors will have to help me ship and sell.
But I'm not sure your preferences are necessarily mass market Fred, what works for you might not necessarily work for the big market/segments that a company is going after.
Do you ever send friends/contacts in, who may be a better fit with the market the company is going after, to consult with a company on your portfolio?
ShanaC
· 4 months ago
I think, if you can get around secrecy problems, sending other people around is an excellent idea. Sometimes a little extra knowledge is a good thing. Also it is really hard to judge the tastes of others unless you go running after others. Why else do I keep talking to people about their tastes in gear? I can't get inside their heads without them explaining it to me. A lot of companies would be prudent to find people to do the same.
fredwilson
· 4 months ago
Well I am a big believer in getting a ton of user feedback. One technique I like is taking a laptop to starbucks at morning rush and offering to wait in line and buy their coffee for anyone who is willing to do a 10 minute on the spot user test
farhanlalji
· 4 months ago
Love the starbucks user testing idea! Thanks for sharing this technique!
ShanaC
· 4 months ago
I intergiew people on trains and try to get them to talk among themselves and explain to me why they like things. BTW, you really should get a female staffer, ideally young to do this. They do studies with this, for some reason women under the age of 35 tend to get more and better results if you need someone to go up random strangers and get them to do something. I know it sounds sexist, but the women are perceived as friendlier and as less harmful, and even a tad more, nurturing...
fredwilson
· 4 months ago
Well I am a big believer in getting a ton of user feedback. One technique I like is taking a laptop to starbucks at morning rush and offering to wait in line and buy their coffee for anyone who is willing to do a 10 minute on the spot user test
fredwilson
· 4 months ago
Well I am a big believer in getting a ton of user feedback. One technique I like is taking a laptop to starbucks at morning rush and offering to wait in line and buy their coffee for anyone who is willing to do a 10 minute on the spot user test
ShanaC
· 4 months ago
Mihai. I'm going to be totally straight. I do not have a tech degree. I'm an art student who likes studying people, both in the social science sense and in the artistic sense. I enjoy reviewing tech products and I wish someone would just give me a list of products they want reviewed to see how it relates to the business plan and how it relates to real life. I grew in a house with way too much tech stuff, so I can tell you how I remember tape drives larger than my height when I was younger. But I can't claim techie-goodness (yet).
As someone who is that First Person who you touch when you cross the Chasm, and plans on trying to stay that person, you may not want the person investing to be the Product Design techie guy. The reason is because you want someone who has the leadership ability to see and identify good design and good products on the business end, and isn't caught up in the technicals that can cause a project to crash and burn. There needs to be some balance, because in the heat of creation, people are headstrong. Everyone I've met through here I've found fascinating and a lot art students in the middle of a difficult painting.
My best example is that because of here, I am now being exposed to a number of products that I would never otherwise see. I question a number of them and their success/failure rate, because as an outsider, I wonder how certain people will use these products within certain heuristic criteria that I find useful. If one interacts with enough people at random while also reviewing products, you get why after a while people keeping repeating this oft heard phrase "1/3 success, 1/3 will make money, and 1/3 will fail."
Now if only I knew how to read all the charts and financials that went with it.
aaronklein
· 4 months ago
Shana, If I were to boil your comment down, you didn't head-on assault Google's decision to have only science grads as PMs, but you made some excellent points as to why it's a dumb practice.
So I'll just say it: it's a dumb practice. And it's a good reason why Google can't do some of the creative things that companies like Twitter have done: they're almost a 100% left brain company. This reminds me of the infamous "testing of 34 shades of blue" that gave Twitter a new creative director.
In my experience, companies are good at hiring or finding what they need to figure out the technical pieces of product development. Good engineers don't grow on trees, but they exist, and it's worth worrying about. But a huge place where companies need help is figuring out in advance the market reaction to what they can build.
In other words, figuring out how to translate their great idea into a minimum viable product. Turning their stream of ideas into something buildable that consumers want, or more importantly, something that they need, even though they didn't know it. (Twitter is a good example of this.)
That's the value Fred gave to these companies in these meetings. Any entrepreneur would kill for that kind of insight (or at least help tweaking their own insight).
Good post.
ShanaC
· 4 months ago
Thank you.
But to be very clear, I think Google does do certain design principles perfectly. They are copying and pasting that principle on everything they do, and they may dominate some markets we are only becoming aware of because of it. If they didn't, they would be a very poor company right now. See this: http://www.shanacarp.com/essays/the-matryokshka...
It would be equally bad if they hired a company full of idea people. Nothing would get done quite the way as expected. Think of it this way- with a lot of help, I probably could go and have a fun time in a startup doing the creative side. Probably, given enough time, I could even come up with a company idea or two. I equally know that some ideas that I have are loony. And that's what causes bad grammar in the post above... ;)
And I'll reiterate what I said above: If someone wants to help me do scheduling, I like doing the testing. I want companies, even if they walk away bankrupt, or ehhh, to at least get that humans have relationships with computers that are distinct, and that one should be careful with them. It makes much better products long term if someone sits down and explains the pluses and minuses of various technologies on even a cursory level because of human error, and what sorts of expectations people have and feel about items in their lives.
aaronklein
· 4 months ago
Absolutely. Balance between left and right brain is key in a company. Well said.
theschnaz
· 4 months ago
The first thing I thought of when I read the title of this post was customer development; actually going out and talking to potential users/customers. You kind of touch on this...
Do any of your companies actively engage in customer development? If so, I'd be really interested to hear what they do/how they're doing it.
fredwilson
· 4 months ago
They all do in one way or another. And there are some great techniques. I'll do a post on this topic
theschnaz
· 4 months ago
Awesome. That will be a great post and I'll share it with the NYC Customer Development meetup people.
fredwilson
· 4 months ago
They all do in one way or another. And there are some great techniques. I'll do a post on this topic
Mike Nolan
· 4 months ago
I just had a conversation along these lines with my dad - now 75 - a former VP of Westinghouse broadcasting and phenomenal broadcasting entrepreneur.
He was practicing Management by Walking Around long before it was being taught in Business Schools.
There are so many benefits to walking around - having unscheduled meetings, and simply rolling up your sleeves - it is amazing more professionals sit behind desks and answer e-mails all day.
Great post...
M
Paul Jozefak
· 4 months ago
Fred, as some people have commented, I'm also a bit surprised that getting out of the office (and visiting your start-ups) isn't a greater part of your day-to-day activities (leaving out Zemanta, as that would be a tough commute regularly).
When we git pitched, after we initially decide to pursue a deeper dive into the investment, our first step is to visit the company. I consider this absolutely necessary to continue digging into a potential investment. In the course of due diligence, I also try to "work from" the offices of target companies to get a feel for the vibe. It doesn't always work in every case but I find it so eye-opening (both negatively and positively) to see how a company ticks and what goes on there. I always make it a point to visit my investments at least every couple of weeks just to do face-to-face meetings. It adds so much value and includes so much which gets left out when only the phone or email are used for communication.
My ultimate goal would be to basically be office-less. I'd love to simply always work from the offices of my investments. Unfortunately, this is unrealistic as there is day-to-day stuff back at the office plus all the pitch meetings. I think my partners would have issues as well were I to completely go off-site but this is because we only have one office. I think a lot of VC's who are remote satellites from their home offices are already doing this to some extent. It seems like Mark, who already commented up above, is doing this in some regard.
facebook-6804417
· 4 months ago
Food for thought: Abraham Lincoln spent about 50% of his time in office out of the...office. Lincoln's reason for relieving General John C. Fremont from top command was, "His cardinal mistake is that he isolates himself, and allows nobody to see him; and by which he does not know what is going on in the very matter he is dealing with."
Lincoln was truly an innovator of leadership techniques that are just as relevant today as they were when he was President.
In my opinion, casual contact with your portfolio companies are 10x more important than formal meetings. For smaller startups, the ability to talk loosely with a VC is a memorable and inspiring experience for employees. For larger companies, I would suggest asking the exec team of these companies for a list of the top 20% performers and stopping by their offices/cubicles just to introduce yourself. In doing so, you leave the office with the 20 percenters feeling important and are simultaneously motivating the other employees that haven't reached that top level yet to get there.
FYI: Stopping by a cubicle will make a huge, positive statement and will surely be noticed by the surrounding employees.
Excellent advice and I love the lincoln quote. I'm gonna reblog that at fredwilson.vc
fredwilson
· 4 months ago
I like your approach. There is a lot of merit to it.
We don't run our back office, we outsource it. So the main things we do in our office are take meetings and talk to each other
The former could/should happen at the company as you point out
But there is a lot of value in the latter. We are three partners who like to act together in synch all the time
I'm not sure how you achieve that if you are never together
So ultimately it is a balancing act. It may well be true that I need to get out even more than I do. That's kind of what I was saying to myself when I wrote the post
Paul Jozefak
· 4 months ago
Basically Fred we have our regular "Monday meetings" ( we do them on Wednesday.) In this case, all three partners are together. We also have a formal pitch from a company for all three partners which happens somewhere in the middle of the D.D. process, after which we can really hash out all issues each partner may have. Further, we are all in the office at least one or two days a week. We may not all speak with one another but one or the other (we are also three partners) is usually there. Finally, we do use the technology available to us on a fairly spontaneous basis (email and phone). I prefer the face-to-face more with target companies and portfolio companies. I know my partners fairly well (as should most VC's) to not need to be face-to-face with them constantly, or definitely not as much as with the start-ups. Nevertheless, as I said, this is a process I too am constantly reviewing and trying to optimize as I surely have not yet found the perfect solution.
fredwilson
· 4 months ago
I like your approach. There is a lot of merit to it.
We don't run our back office, we outsource it. So the main things we do in our office are take meetings and talk to each other
The former could/should happen at the company as you point out
But there is a lot of value in the latter. We are three partners who like to act together in synch all the time
I'm not sure how you achieve that if you are never together
So ultimately it is a balancing act. It may well be true that I need to get out even more than I do. That's kind of what I was saying to myself when I wrote the post
bryanmcclain
· 4 months ago
I totally agree with you. This is important not just for VC's and managers, but also for innovators and entrepreneurs. When you leave your desk and get out of the office, you breathe new life into your ideas and projects. I try and get out and spend time with people for at least an hour a day.
Bryan McClain Partner and Senior UX Researcher at ActiveComm Labs
jasoncrawford
· 4 months ago
Good post, Fred. The best managers and execs I've known are detail-oriented and spend time to immerse themselves in the details like this; they get a much clearer and more grounded understanding of what's actually going on that way.
How do you reconcile (a) being detail-oriented with (b) not micromanaging? How do you get hands-on while still making sure people feel ownership over their work? Sometimes people do a *better* job if they feel that no one is checking up on them and it's all on their shoulders.
Andy Swan
· 4 months ago
That's a good post. One thing I'd add is that the time "away from the desk" doesn't necessarily need to have a strategic purpose beforehand in order to turn out to be valuable.
Landon and I have had some of our most productive and "game-changing" days when we purposefully worked at a coffee shop, bowling alley, golf course or bar (that one gets tricky).
It is amazing how much easier it is to think outside the box when you actually get your ass outside the box!
fredwilson
· 4 months ago
isn't it a bit loud in the bowling alley :)
Andy Swan
· 4 months ago
Not in the middle of the day....except field trip day. That was brutal :)
CoryS
· 4 months ago
Working for a larger company, I totally get the challenges and benefits to 'management by walking around'. It consumes hours, if not days, but honestly, I can't imagine being more productive when done right. Now, we all pay the price by doing email and quant work at 8PM, but I think office time is really good collaboration time and should be used for it when possible v. being in an office with the door shut. If there's no common office, then making time in a common space is priceless for high output people.
Fred, my bet is that you offer more vision and strategy in one hour than most entrepreneurs could hope for the rest of the month. Keep on it.
J. Pablo Fernández
· 4 months ago
It seems that "Getting out from behind your desk" is much harder for a VC than for a manager.
Jake Simms
· 4 months ago
Great truth to this post. I'm a project manager at a small interactive agency, and the majority of my days are spent doing nothing but emailing with an occasional phone call. This week, due to a full schedule I saw myself picking up the phone, going in for face to face meetings, and doing some on site work at a video shoots much more often than I normally do. Though half of my days were spent out of the office, I found that once I got back - despite the shorter time frame in front of my machine, I was able to knock out much more than normal and answer questions from my colleagues much more directly and efficiently. Sounds like a no brainer, but sometimes you just need the reminder to shake things up.
jturner
· 4 months ago
I agree, getting out in the real world and seeing how businesses function in person is very important for any type of business manager. On a related note, I think going forward businesses are going to struggle in this economy, because the government has been the only driver of growth lately, and that is not sustainable in a free market system.
I think that as the employment picture continues to not show many signs of improvement, people will come to realize that the only reason the economy has stabilized is due to govt stimulus and spending. And that the Fed will be forced to continue to keep rates near zero and support the credit markets. This will continue to have negative consequences for the dollar, and unfortunately the only way for most people to protect and potentially prosper from this is by investing in those assets that should rise from all the money printing, such as gold and other commodities. Here is a link to a site that has a good discussion on a gold mining company, Premier Gold that should benefit from a rise in the gold price.
Steven Kane
· 4 months ago
Used to be rule of thumb in VC: only invest in companies you can drive to, can visit easily, or on impulse.
But in the last few years that has come to be seen as obsolete.
Seems maybe you think its actually smart policy?
fredwilson
· 4 months ago
More than two/thirds of our invesments are in the NYC area. So I believe in it. But I also believe that you need to be in the best deaks that come your way. So I don't think you can just invest locally but you can make it your primary focus
JLM
· 4 months ago
Once upon a time in a different galaxy, lots of business got done on the golf course. Folks negotiated the finer points of business deals, leases, loans and acquisitions. I have never met a guy who cheated at golf who gave me a fair shake on any of the above. You have to create the situation in which the situational ethics is a proxy for the likelihood of success. Then you have to pay attention. There are damn few Mulligans in business.
Money is just a commodity. A pretty damn precious commodity granted, but a commodity nonetheless.
The way it is invested and the likelihood for success can be colored by personality and the personal touch. I have done business with folks I just enjoyed doing business with. I have always made money w/ them. I have made money with folks who I did not like but it was never enough. Ever.
Most VCs want to be entrepreneurs and, if smart, appreciate the entrepreneurial zeal which drives folks to conceive, risk, operate and reap. To be able to size up this talent is a critical element of the skill set of a VC. To fail to develop this talent is to have both a hole in your soul but also a hole in your head.
Some skills are incredibly important. At some level certain skills are indispensable. The greatest baseballer who NEVER lived --- Michael Jordan, couldn't hit a curve ball.
America does business with its friends. Are you a good friend or just a jerk with a lot of OPM? When you go, with no big agenda, to look in on your folks, you are extending the hand of friendship. And that's a good thang!
fredwilson
· 4 months ago
I did some business on the golf course yesterday Jim. Its not over
Prokofy
· 4 months ago
Well site visits seem important of course, but do those folks ever feel like you're hovering too much or that the Inspector General is coming?
All Comments
Of course the film would come out later as not to interfere with the developments but it could be both a potent learning tool for budding entrepreneurs, venture capitalists, and a powerful PR/marketing venue for portfolio companies hitting a different segment of potential users.
Maybe just document later meet ups or specific segments, no need for constant survellience.
I guess it would be too much of a real vc world publicity fest and folks would be less likely to share or risk saying something "dumb"
I've always thought a VC's office is a place where they visit once a month to regroup. In fact, I have been fascinated at how many VCs that live very public lives (blogging, tweeting, writing columns for magazines, etc) are able to keep up with day to day work. I'm curious how inaccurate that perception is. Do VC's offices sometimes have a 9-5 vibe?
In that 'typical day' I spend from 8am to 6/7pm in my office booked in back to back meetings. Sometimes I'll do 10 meetings in one day
See my post here: http://www.theprivateequiteer.com/making-great-...
When I was joining my second board back in '91 or '92, the entrepreneur made me spend a week working at his company before he'd take any advice from me
Part of that was I was young and green and guilty of all things young green VCs do
And part of it was I didn't really get his business until after I'd spent a week there
It was a great lesson for me at a young age
Some weeks this works better than others, and as you mention, I always wish I could be doing it more.
Both product and design discussions require some technical skills. At Google, new PMs are now required to have at least a science degree.
but i see a lot of products, i use a lot of products, and i have a good
sense of what works and what best practices are
so i can help our companies in that way
i think many of the best VCs are good at exactly that
But I'm not sure your preferences are necessarily mass market Fred, what works for you might not necessarily work for the big market/segments that a company is going after.
Do you ever send friends/contacts in, who may be a better fit with the market the company is going after, to consult with a company on your portfolio?
Sometimes a little extra knowledge is a good thing. Also it is really hard to judge the tastes of others unless you go running after others. Why else do I keep talking to people about their tastes in gear? I can't get inside their heads without them explaining it to me. A lot of companies would be prudent to find people to do the same.
BTW, you really should get a female staffer, ideally young to do this. They do studies with this, for some reason women under the age of 35 tend to get more and better results if you need someone to go up random strangers and get them to do something. I know it sounds sexist, but the women are perceived as friendlier and as less harmful, and even a tad more, nurturing...
As someone who is that First Person who you touch when you cross the Chasm, and plans on trying to stay that person, you may not want the person investing to be the Product Design techie guy. The reason is because you want someone who has the leadership ability to see and identify good design and good products on the business end, and isn't caught up in the technicals that can cause a project to crash and burn. There needs to be some balance, because in the heat of creation, people are headstrong. Everyone I've met through here I've found fascinating and a lot art students in the middle of a difficult painting.
My best example is that because of here, I am now being exposed to a number of products that I would never otherwise see. I question a number of them and their success/failure rate, because as an outsider, I wonder how certain people will use these products within certain heuristic criteria that I find useful. If one interacts with enough people at random while also reviewing products, you get why after a while people keeping repeating this oft heard phrase "1/3 success, 1/3 will make money, and 1/3 will fail."
Now if only I knew how to read all the charts and financials that went with it.
So I'll just say it: it's a dumb practice. And it's a good reason why Google can't do some of the creative things that companies like Twitter have done: they're almost a 100% left brain company. This reminds me of the infamous "testing of 34 shades of blue" that gave Twitter a new creative director.
In my experience, companies are good at hiring or finding what they need to figure out the technical pieces of product development. Good engineers don't grow on trees, but they exist, and it's worth worrying about. But a huge place where companies need help is figuring out in advance the market reaction to what they can build.
In other words, figuring out how to translate their great idea into a minimum viable product. Turning their stream of ideas into something buildable that consumers want, or more importantly, something that they need, even though they didn't know it. (Twitter is a good example of this.)
That's the value Fred gave to these companies in these meetings. Any entrepreneur would kill for that kind of insight (or at least help tweaking their own insight).
Good post.
But to be very clear, I think Google does do certain design principles perfectly. They are copying and pasting that principle on everything they do, and they may dominate some markets we are only becoming aware of because of it. If they didn't, they would be a very poor company right now. See this: http://www.shanacarp.com/essays/the-matryokshka...
It would be equally bad if they hired a company full of idea people. Nothing would get done quite the way as expected. Think of it this way- with a lot of help, I probably could go and have a fun time in a startup doing the creative side. Probably, given enough time, I could even come up with a company idea or two. I equally know that some ideas that I have are loony. And that's what causes bad grammar in the post above... ;)
And I'll reiterate what I said above: If someone wants to help me do scheduling, I like doing the testing. I want companies, even if they walk away bankrupt, or ehhh, to at least get that humans have relationships with computers that are distinct, and that one should be careful with them. It makes much better products long term if someone sits down and explains the pluses and minuses of various technologies on even a cursory level because of human error, and what sorts of expectations people have and feel about items in their lives.
Do any of your companies actively engage in customer development? If so, I'd be really interested to hear what they do/how they're doing it.
He was practicing Management by Walking Around long before it was being taught in Business Schools.
There are so many benefits to walking around - having unscheduled meetings, and simply rolling up your sleeves - it is amazing more professionals sit behind desks and answer e-mails all day.
Great post...
M
When we git pitched, after we initially decide to pursue a deeper dive into the investment, our first step is to visit the company. I consider this absolutely necessary to continue digging into a potential investment. In the course of due diligence, I also try to "work from" the offices of target companies to get a feel for the vibe. It doesn't always work in every case but I find it so eye-opening (both negatively and positively) to see how a company ticks and what goes on there. I always make it a point to visit my investments at least every couple of weeks just to do face-to-face meetings. It adds so much value and includes so much which gets left out when only the phone or email are used for communication.
My ultimate goal would be to basically be office-less. I'd love to simply always work from the offices of my investments. Unfortunately, this is unrealistic as there is day-to-day stuff back at the office plus all the pitch meetings. I think my partners would have issues as well were I to completely go off-site but this is because we only have one office. I think a lot of VC's who are remote satellites from their home offices are already doing this to some extent. It seems like Mark, who already commented up above, is doing this in some regard.
Lincoln was truly an innovator of leadership techniques that are just as relevant today as they were when he was President.
In my opinion, casual contact with your portfolio companies are 10x more important than formal meetings. For smaller startups, the ability to talk loosely with a VC is a memorable and inspiring experience for employees. For larger companies, I would suggest asking the exec team of these companies for a list of the top 20% performers and stopping by their offices/cubicles just to introduce yourself. In doing so, you leave the office with the 20 percenters feeling important and are simultaneously motivating the other employees that haven't reached that top level yet to get there.
FYI: Stopping by a cubicle will make a huge, positive statement and will surely be noticed by the surrounding employees.
- Straight from a startups mouth; www.glucosebuddy.com
We don't run our back office, we outsource it. So the main things we do in our office are take meetings and talk to each other
The former could/should happen at the company as you point out
But there is a lot of value in the latter. We are three partners who like to act together in synch all the time
I'm not sure how you achieve that if you are never together
So ultimately it is a balancing act. It may well be true that I need to get out even more than I do. That's kind of what I was saying to myself when I wrote the post
We don't run our back office, we outsource it. So the main things we do in our office are take meetings and talk to each other
The former could/should happen at the company as you point out
But there is a lot of value in the latter. We are three partners who like to act together in synch all the time
I'm not sure how you achieve that if you are never together
So ultimately it is a balancing act. It may well be true that I need to get out even more than I do. That's kind of what I was saying to myself when I wrote the post
Bryan McClain
Partner and Senior UX Researcher at ActiveComm Labs
How do you reconcile (a) being detail-oriented with (b) not micromanaging? How do you get hands-on while still making sure people feel ownership over their work? Sometimes people do a *better* job if they feel that no one is checking up on them and it's all on their shoulders.
Landon and I have had some of our most productive and "game-changing" days when we purposefully worked at a coffee shop, bowling alley, golf course or bar (that one gets tricky).
It is amazing how much easier it is to think outside the box when you actually get your ass outside the box!
Fred, my bet is that you offer more vision and strategy in one hour than most entrepreneurs could hope for the rest of the month. Keep on it.
I think that as the employment picture continues to not show many signs of improvement, people will come to realize that the only reason the economy has stabilized is due to govt stimulus and spending. And that the Fed will be forced to continue to keep rates near zero and support the credit markets. This will continue to have negative consequences for the dollar, and unfortunately the only way for most people to protect and potentially prosper from this is by investing in those assets that should rise from all the money printing, such as gold and other commodities. Here is a link to a site that has a good discussion on a gold mining company, Premier Gold that should benefit from a rise in the gold price.
But in the last few years that has come to be seen as obsolete.
Seems maybe you think its actually smart policy?
Money is just a commodity. A pretty damn precious commodity granted, but a commodity nonetheless.
The way it is invested and the likelihood for success can be colored by personality and the personal touch. I have done business with folks I just enjoyed doing business with. I have always made money w/ them. I have made money with folks who I did not like but it was never enough. Ever.
Most VCs want to be entrepreneurs and, if smart, appreciate the entrepreneurial zeal which drives folks to conceive, risk, operate and reap. To be able to size up this talent is a critical element of the skill set of a VC. To fail to develop this talent is to have both a hole in your soul but also a hole in your head.
Some skills are incredibly important. At some level certain skills are indispensable. The greatest baseballer who NEVER lived --- Michael Jordan, couldn't hit a curve ball.
America does business with its friends. Are you a good friend or just a jerk with a lot of OPM? When you go, with no big agenda, to look in on your folks, you are extending the hand of friendship. And that's a good thang!