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The simple fact is when you hire entrepreneurs to be VCs, you're going to see more turn-over. Most non-entrepreneur VCs are natural lifers. They'll only leave VC under duress, with their cold, dead fingers on the partnership agreement.
Most successful entrepreneurs-turned-VC see it very differently. If it's a bad fit ... they'll move on. After a while.
So it's a trade-off. VCs are becoming more "entrepreneur-partner backgrounded". That will lead to more turnover.
1 month ago on What the hell is happening at Google Ventures?
I think this is pretty standard in these deals. You'll see it in a lot of billion+ valuation rounds. The mutual fund or other late stage fund will take the small risk the IPO never happens, and live with illiquidity until then -- for a minimum guaranteed return (not a huge one, but a real one) plus the potential upside if the stock does better than expected.
It can be brutal in some cases (see, e.g. Chegg) but usually it has no material effect and comes with the territory.
2 months, 2 weeks ago on Box’s updated S-1 contains onerous hidden penalties if the company is late to IPO
Why in all these deals are the Series A investors making a profit and Series B losing everything? Is the day of Series B seniority to Series A in the liquidation preference dead? I guess so.
8 months, 1 week ago on Celebrities, virality, and VC hype: A Viddy postmortem
10 months, 3 weeks ago on Don’t go chasing (startup) waterfalls
Money doesn't quit but Ego dreams bigger. Once Money gets its target return, if there's an acquirer -- it sells.
10 months, 3 weeks ago on Is it better to be motivated by money or ego?
1 year, 4 months ago on Memo to this year’s YC class: It’s damn hard to build an enterprise company
This is really a terrific analysis. Just very solid.
The one thing worth adding though, is that as tough as it is -- 7-10 years; $100m in capital; 500+ employees; etc. etc. -- the markets are growing faster than ever, and because of that ... multiples are higher than ever.
That takes some of the sting out of it.
But if you're not up for a 7-10 year journey -- Do No Start a SaaS / Enterprise company ...
Really great post.
1 year, 11 months ago on Software has long been the lifeblood of the Valley. So why are VCs just now remembering this?
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