Both Sides of the Table


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What is the role of a VC for entrepreneurs?

I suppose it can be different for every founder and for different VCs but I’d like to offer you some context on what I think it is and it isn’t. I was recently contacted by an entrepreneur who was consider a few different business models for his company. I barely know the guy (or his markets) but he wanted me to weigh in one “which market I thought he should pursue.” I responded

“I can’t tell you that one approach is surely better than the other. If I said so I’d be disingenuous.

My job isn’t to predict markets but rather to find entrepreneurs who want to create markets through insight and conviction.”

And that’s the simplest way I view my job. It’s to find great entrepreneurs who are passionate about solving a problem. They become obsessed with why the problem exists and they start chipping away at ideas for solving the problem. The develop so much conviction that they can solve it that they do the most difficult thing one can do with one’s ego. They tell the world publicly that they not only are going to solve the problem but they’re going to do it better than anybody else in the market.

I see this on a regular basis like the founders – Josh Mangel & Aaron Peck – at Skurt who are asking the obvious question of why renting a car an airport sucks so badly. Of course as a frequently traveler I know this, too. But the infinitesimally small daily decisions that one needs to make the better that system will never come from me. (Note: before you jump down my throat

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Not everybody likes the NY Times. I happen to be a long-time fan and paid subscriber. I mostly read the op eds and have for years. I count amongst my favorite people to read from the left & the right as David Brooks, Thomas Friedman & Paul Krugman (and was a big fan of the late William Saffire). I also read almost every Maureen Dowd post even though I don’t always agree with her politics or viewpoints I find it interesting to get other perspectives than my own.

So it’s a disappointment to me that these esteemed journalists haven’t adapted to the modern media – to social media. I think they would all hone their craft if they spent a bit more time engaging in online discussions, reading perspectives of others and occasionally commenting publicly with others. Rupert Murdoch is nearly 84 and he seems to have figured out how to be authentic on Twitter and even engage a bit as you can see if you follow his amusing Tweet stream. That’s why I follow Rupert and none of the journalists. Shame.

Here’s an example from nobel-prize economist Paul Krugman.

He can write well about economics but dude can’t Tweet.

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And edited version of this article first appeared on TechCrunch.

Startups in a world of massive markets can be confusing. The law of large numbers, platforms that can make your company blow up unexpectedly and the trendy nature of tech markets can be deceiving.

Success for many is ephemeral.

I have written about the deceiving nature of early successes before – in particular in the SaaS or B2B world leading to a phenomenon called “shelfware.” If you didn’t read it I recommend it. It’s important to understand.

This is why I loved Brad Feld’s recent post about the “illusion of product / market fit.” This, too, is a must read for any entrepreneur.

I am obsessed with a topic because it has literally become my job.

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I was waiting for my son’s basketball game to start this morning and with the morning’s emails all drained I turned to Twitter and saw this Tweet from Marshall Kirkpatick

Test: open your twitter stream, look at the 1st item in it, think of something to say in response, say it. Theory: it’s really that simple.

— Marshall Kirkpatrick (@marshallk) January 24, 2015

I consider Marshall a business friend. A fellow thinker and tinkerer of technology. Somebody I respect. And like. But here’s the thing – I honestly can’t remember how many times I’ve actually met Marshall in person? I know him really through online and from that we’ve had phone calls to debate his business and such.

It’s an online relationship and I actually believe that as of 2015 I’ve met more of my close connections in the past 5-7 years online before offline. Brad Feld. Fred Wilson. Tristan Walker. And many, many more. Some through blog comments – your place or mine. Some on Twitter.

I responded to Marshall’s obvious comment bait with “I’m always surprised more people don’t engage.

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Any reader of this blog for a period of time will know that I’ve been long YouTube for years. Along with Greycroft, I was the first institutional investor in Maker Studios (sold to Disney for nearly $1 billion) and am still the largest investor in Mitu Network, the largest online video producer of Latino content. We have made 5 online video investments in total – some we will talk about later this year.

The reasons I have been long on YouTube specifically are very simple:

YouTube now has > 1 billion uniques / month. This is 14% of world population and 33% of all people online.
A new generation of content producer and video style has emerged that is distinctly different from what you see in TV. 40% of all of YouTube is viewed on mobile devices and of high-quality content I believe it is between 60-70% based on my insider data.
The stars of tomorrow are being built on these short-form formats. It’s hard to understand this until you attend something like VidCon and watch youth interaction with their “stars.

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