When we think about VC value add, it’s usually in a few key areas like strategy, management hires, raising capital and exiting your business. These are all super important, but they are also rare events. If you’re changing your strategy all the time, that’s a bad thing. You will make only a handful of key management hires, etc, etc.
Yesterday, I spent time looking for a better phone system for one portfolio company. Over the weekend, my partner JS found a great developer candidate for a portfolio company that we have not even closed yet! The point is not to toot our horn, but is to acknowledge something I have seen a lot in our portfolio. While help on strategy, funding and other big pictures items is great, what our founders need help with most is more tactical day to day stuff.
As a founder, your most precious resource is time. You never have enough of it. It’s not an investor’s job to come in and pretend to be an operator alongside you. I often say – ‘you can’t be a little bit pregnant’. So don’t pretend to be a part time exec for a portfolio company. But you can add tangible, actionable value to the day to day activities of the teams you back.
Rather than talk about overall strategy, why not dig deeper and optimize the mechanics of a conversion funnel? That has immediate impact. Rather than introducing a company to a potential biz dev partner, why not help optimize the lead gen and sales conversion process to help the company close more sales every day?
As we plan for the coming year at Real Ventures we are thinking about ways to have a tangible day to day impact. Andreessen Horowitz is a role model and benchmark in our thinking. We can’t replicate what they do. They have billions in capital, we’re pretty tiny. But only 6 of their 66 team members are investing partners. A good chunk of the rest are adding value and leverage to their companies. That’s the future of VC in my books…