« If Mark Was Rupert | Main | Management Case, Base Case and Worst Case »
VC Cliche of the Week
I don't have the inspiration this morning so I am going to turn this post over to the readers.
Please post your favorite VC cliches in the comments section and I'll bring them up to the front page.
--------
Thanks everyone! I may reblog some of these. Go to the comments to get the explanations for them.
"There's no there there" - Charlie
"skin in the game" - Simon
"shoulder to shoulder" - Simon
"We can move quickly" - Jay Rand
"We're not investing in this space right now" - Charlie Crystle
"You're too early for us" - Derek Scruggs
"We DO seed stage investments" (when they actually don't) - Simon Veingard
Sustainable competitive advantage - Daniel Nerezov
"Orders of magnitude" - Greg
"Sweat equity." - Joe
We provide more than just capital. - Alistair
"That's management's problem" as opposed to "that's a management problem." - Tom Evslin
Its not just our money its our contacts - Brian
now tell us what you would do with five times the investment amount - Brian
we're entrepreneurs too - Brian
"They have a good story to tell." - Keith Alioto
"let's wait until we get our guys in
there to see where the bodies are buried" - Keith Alioto
"It's the golden rules. He who has the gold, makes the rules." - Flint
We have a "hands-on" approach. - Hooman Radfar
This ain't my first Bar-B-Q. - Jackson
It looks good from my house. - Jackson
Someday this war is gonna end. - Jackson
Water on the lectern. - Jackson
We don't have a problem building a bridge, but there's got to be another side. - Johannes Ernst
Friendly Fire - Ken Berger
"How will you reach the beach?" - David Churbuck
"What's your Microsoft (Google)(AOL)play?" - David Churbuck
"Eat what you kill." - David Churbuck
Scalable and repeatable sales process. - Chris Yeh
"bowling alley effect" - Ruchit
What's your "unfair advantage"? - An Entrepreneur
"First mover" - An Entrepreneur
Will the dogs eat the dog food? - Bill Bryant
"Can Microsoft develop this too?" - Caspar
"defensible intellectual property" - Bob Chatham
"this will be a long movie" and "I've seen this movie before" - Toni
"let's drain this swamp" - Toni
"Too much has to go right for you to succeed." - Mark Sigal
"Who do you look like?" - Mark Sigal
"It's as deadly to be too early as it is to be too late." - Mark Sigal
Deal Rhythm. - Daniel Nerezov
"Value-Added Investor" - James Haft
What's your value add? - David Cavalier
Let's not reinvent the wheel - David Cavalier
We're "value added" investors - David Cavalier
We need smart money in the deal - David Cavalier
Let's see how they block and tackle - David Cavalier
"Forecasting rain is one thing, building an ark is another." - Mike Santer
"In the beginning
you need the barbarians." - Mike Santer/John Chambers
"If you don't know your meat, you better know your butcher." - Mike Santer
"There's always more month at the end of the money." - Mike Santer
"If you are not the lead dog, the scenery never changes." - Mike Santer
"Make dust or eat dust." - Mike Santer
"Second place is still losing." - Mike Santer
"That Company's multiple (earnings or sales) discounts not only the future, but also the hereafter." - Mike Santer
"It doesn't much signify whom one marries, for one is sure to find next morning that it was someone else." - Mike Santer
"You're telling Noah about high water." - Mike Santer
"Pigs get fat, hogs get slaughtered" - Greg Haslam
"there's a lot of hair on that deal" - Greg Haslam
October 19, 2005 in Venture Capital and Technology | Permalink
TrackBack
TrackBack URL for this entry:
http://www.typepad.com/t/trackback/5934/3407445
Listed below are links to weblogs that reference VC Cliche of the Week:
Comments
There's no there there.
Posted by: Charlie | Oct 19, 2005 8:34:40 AM
One of my favorites, and something that is important whether you are judging an entrepreneur, a board member or a vc firm, is whether they have enough, "skin in the game".
"Skin in the game", refers to the person's level of involvement/commitment.
So, for example, a serial entrepreneur who is starting a new company but has another company that he is also working on simultaneously may not have sufficient "skin in the game" to justify an investment.
In many cases you want someone who has made some kind of sacrifice, ex. left a job at a good company, invested their life's savings or taken out loans to finance the business, etc. because it demonstrates commitment.
This brings to mind a related cliché, "shoulder to shoulder". In this case, you want an entrepreneur who will stand "shoulder to shoulder" with you.
This means someone who stands with you, taking the same risks and sharing in the rewards. It is used to connote an alignment of interests.
Posted by: Simon | Oct 19, 2005 9:35:48 AM
Here's one of my favorites - "We can move quickly." Many entrepreneurs are put off by the process that VCs usually employ in making an investment. They don't like the time that it takes and the resources that it uses up. So VCs like to say this to keep things moving and keep the entrepreneurs interested. The fact is that institutional VCs will typically follow that process, and with a good VC it's hard to take short cuts.
Posted by: JayR | Oct 19, 2005 9:59:26 AM
"We're not investing in this space right now."
This space meaning your company.
Posted by: charlie crystle | Oct 19, 2005 11:40:59 AM
"You're too early for us."
Meaning, go create a ton of value and remove all the risk before we take half your company for not-enough capital. ;)
Posted by: Derek Scruggs | Oct 19, 2005 12:12:24 PM
VC's website investment criteria states "We DO seed stage investments"
VC's response to pitch "We DON'T do seed stage"
Meaning? Perhaps the VC hasn't updated their website since the dot-com era... or was our pitch was that bad ;-)
Posted by: Simon Veingard | Oct 19, 2005 12:18:22 PM
Sustainable competitive advantage.
Lord knows what that is ( I mean c'mon, really) and for how long it's sustainable.
Posted by: Daniel Nerezov | Oct 19, 2005 12:27:37 PM
"Orders of magnitude"
A common cliche of those in the venture business, as well as of the management teams in search of funding. Incremental innovation does not ever seem to intrigue VC's quite as much as technology that offers "orders of magnitude" improvement. Young teams are often sent in search of seasoned executives who can offer "orders of magnitude" improvement on process and organizational management.
"Orders of magnitude" companies produce the homeruns of a VC portfolio, but I wonder how many doubles and triples are overlooked in the search? George Brett and Robin Yount made it all the way to the Hall of Fame on the strength of the double.
Posted by: Greg | Oct 19, 2005 1:19:28 PM
"Sweat equity." Preferred stock given to the founders even though they have not made a comparable capital investment.
Posted by: Joe | Oct 19, 2005 1:22:00 PM
Comparable capital investment? "Even though?" Are you implying that my 16 hours a day have less value than capital? Anyone can give capital. Innovation, market identification, market creation are all part of sweat equity. Kids that get financed solely on business plans and grad school pedigree might not really get that, but I certainly do.
Posted by: charlie crystle | Oct 19, 2005 1:31:48 PM
We provide more than just capital.........
Russian prostitutes offer "not just coffee....."
Posted by: Alistair | Oct 19, 2005 1:44:23 PM
"That's management's problem" as opposed to "that's a management problem." The former is music to a CEO's ears because it means the VCs are gonna leave management space to work out the problem. The latter means the VCs think the CEO IS the problem.
Posted by: Tom Evslin | Oct 19, 2005 1:47:43 PM
Charlie -- that was my poorly articulated point. I didn't mean to imply that sweat equity was less valuable than a financial investment at all.
Posted by: Joe | Oct 19, 2005 2:12:21 PM
1. Its not just our money its our contacts,
2. now tell us what you would do with five times the investment amount,
and my favorite,
2. we're entrepreneurs too!
Posted by: Brian Puckett | Oct 19, 2005 3:14:17 PM
Before a company presents to us I love hearing the partners preface it with, "They have a good story to tell."
I'm always disappointed by the lack of castles, dragons and/or aliens in their "stories." Maybe that just doesn't translate well to PowerPoint.
A new one I've heard recently is, "let's wait until we get our guys in there to see where the bodies are buried" in reference to due diligence and auditing the financials.
Posted by: Keith Alioto | Oct 19, 2005 3:50:07 PM
From a VC - "It's the golden rules. He who has the gold, makes the rules."
You hear that when the VC knows you are desperate to close the round and you are about take a major bath.
Posted by: Flint | Oct 19, 2005 3:53:15 PM
We have a "hands-on" approach.
Babelfish translation (VCese-->Entrepreneurese): We are going to call you every day until you make us money.
Posted by: Hooman Radfar | Oct 19, 2005 4:56:54 PM
Here's some from the world of Pahrmacuetical Sales Meeting Production:
This ain't my first Bar-B-Q.
It looks good from my house.
Someday this war is gonna end.
Water on the lectern.
Posted by: jackson | Oct 19, 2005 5:39:21 PM
We don't have a problem building a bridge, but there's got to be another side.
Or variations on it.
Posted by: Johannes Ernst | Oct 19, 2005 6:32:44 PM
Friendly Fire. (Fred- we already chatted about this but I'll share it here):
I am hearing this particular phrase a lot lately. It's always from a VC who beckons an entrep to confide in them, be brave and share their business plan-- then expect SHARP CRITICISM, often to the point of having the plan and would-be VC funding aspirations torn apart. The thinking is that the entrep should be happy to receive such feedback the 'easy way'--from a 'friend', rather than the hard way-- from the VC they REALLY want the term sheet from.
Hence "Friendly Fire".
Posted by: Ken Berger | Oct 19, 2005 6:47:58 PM
"How will you reach the beach?"
"What's your Microsoft (Google)(AOL)play?"
"Eat what you kill."
ad infinitum
Posted by: David Churbuck | Oct 19, 2005 6:52:00 PM
{At a VC event}
Q: So, what do you look for in a startup in market X?
A1: You mean, why we invest in one company?
A2: Yes, I believe me meant the alpha--
...
Moderator: Anyone want to answer the question?
Posted by: Devin | Oct 19, 2005 7:44:33 PM
Scalable and repeatable sales process.
Posted by: Chris Yeh | Oct 19, 2005 8:07:42 PM
"bowling alley effect" not sure if this is usual VCs cliche, but yeah that is something which stakeholders want to achieve.
Posted by: Ruchit | Oct 19, 2005 11:54:38 PM
What's your "unfair advantage"? is a question I often heard when pitching deals. Investors don't want a level playing field, they want a field tipped unfairly toward the business they fund. The unfair advantage may be a key partnership, a key patent, a unique and hard to reproduce solution to a very hard problem, etc. "First mover" (another cliche) is not an unfair advantage for most businesses, though many founders would like to believe it is.
Posted by: An Entrepreneur | Oct 20, 2005 1:34:34 AM
Will the dogs eat the dog food?
Posted by: Bill Bryant | Oct 20, 2005 3:02:16 AM
"Can Microsoft develop this too?": actual VC question (by a major Dutch fund, in 1999) and nominee in the category Most Intelligent Question to Ask After Three Weeks of Due Diligence.
[Sure they can, they are no idiots and they happen to have a 5 Billion dollar R&D budget... The real question is: why haven't they done this already? Very likely because they're not going to!]
Turns out they still haven't done so to date. The investment opportunity was acquired at very nice multiples by the world market leader in its segment in the middle of the dot com crisis two years later.
Posted by: Caspar | Oct 20, 2005 7:39:18 AM
"defensible intellectual property"
Seems that more people have offensive use of patents in mind these days...
Posted by: Bob Chatham | Oct 20, 2005 8:21:30 AM
"this will be a long movie" and "I've seen this movie before" (I'm investing but I have no idea how it will turn out/we're headed for trouble)
"let's drain this swamp" (this is a messy marketplace and we will clean it up) - I think this qualifies as both VC and Entrepreneur cliche (you should collect those next if you haven't already!)
Posted by: Toni | Oct 20, 2005 11:04:46 AM
A bit OT but a rare, honest VC moment came last spring when I heard a guy tell that he couldn't assess our concept(content management/sharing) because he didn't even know the right questions to ask. Top-tier house, too. I was impressed.
Posted by: Stan DeVaughn | Oct 20, 2005 1:08:38 PM
Three favorites:
1. "Too much has to go right for you to succeed."
Translation: if the success of your business is predicated on securing Cisco as a distribution partner AND convincing enterprises to embrace your proprietary technology and tools, too much has to go right for you to succeed.
2. "Who do you look like?"
Translation: VCs are the ultimate thin slicers so they look to pattern recognition of past companies that have adopted a similar strategy to breakout success.
3. "It's as deadly to be too early as it is to be too late."
Translation: Breakout markets are as much a function of "right time" as "right solution." You would have hated to be Novell in the mid 80s when nobody knew why they needed a network (Novell almost died several times). A few years later, they could have been Microsoft. Timing is everything.
Posted by: Mark Sigal | Oct 20, 2005 4:38:38 PM
Deal Rhythm.
Starting the relationship, from courting to funding and after investment activity, they say the whole thing has to have a recognizable feel to it.
With pitching, the process needs to be spread out over about 6 months for plenty of consecutive good news and pleasant surprises. That's deal rhythm and the old venture cha-cha.
Posted by: Daniel Nerezov | Oct 20, 2005 6:19:58 PM
"Value-Added Investor"
Posted by: james haft | Oct 21, 2005 11:33:06 AM
What's your value add?
Let's not reinvent the wheel
We're "value added" investors
We need smart money in the deal
Let's see how they block and tackle
Posted by: Dave Cavalier | Oct 21, 2005 2:54:59 PM
A few VC cliches heard over the years:
1.) "Forecasting rain is one thing, building an ark is another." Many can see and dream, but few can organize, manage and lead in a way that brings success.
John Chambers of Cisco also said something related to this about the type of individuals that are required for startups - "In the beginning you need the barbarians."
Also another I've heard that is related to the fact that people are critical to the success of a startup - "If you don't know your meat, you better know your butcher." Used when a VC discusses hiring key executives with an entrepreneur/CEO.
2.) "There's always more month at the end of the money."
A scary sounding phrase when you first read it. But it usually takes more money than entrepreneurs and often, VCs, think it will take.
3.) Three that describe (two vividly) the importance of being a leader in a market area:
"If you are not the lead dog, the scenery never changes."
"Make dust or eat dust."
"Second place is still losing." (I think Larry Ellison says this often.)
4.) "That Company's multiple (earnings or sales) discounts not only the future, but also the hereafter." Used by some VC's to deflate an entrepreneur's comparison of his/her company to a public Company in the same market.
5.) "It doesn't much signify whom one marries, for one is sure to find next morning that it was someone else." Venture capital is risky and failure is a big part of being a VC. Even with all the due diligence and spending time with management, competitors and customers - an investment doesn't always turn out the way a VC expects - and sometimes this realization happens quickly.
6.) "You're telling Noah about high water." Not so much a VC cliche - but rather one said by an entrepreneur when pitching to a VC. Usually heard when the VC begins to understand the pitch and makes a comment to the entrepreneur about the idea citing a problem/pain that the VC has exprerienced or identified.
Posted by: MikeSanter | Oct 21, 2005 3:35:54 PM
"Pigs get fat, hogs get slaughtered"
"there's a lot of hair on that deal"
Posted by: Greg Haslam | Oct 21, 2005 7:32:08 PM
Cliche: "Don't believe your own bullshit"
Learn to look in the mirror every once in awhile.
Posted by: W Wong | Oct 26, 2005 2:12:57 PM
most inappropriate VC cliche /conversation stopper I ever heard: When we were looking to fund a video sign on the top of the Conde Nast building, explaining that we were encountering the "you're too early" syndrome, and were going to have to get it funded for a while before people "got it" enough to make real money, the 25 yr old VC associate interupts: "so what you're saying is we're going to have to put it in soft and wait to get hard."
Posted by: Rob MacMillan | Oct 27, 2005 8:32:31 AM
"Bet on the jockey not the horse"
The quality of the management team in a deal is more important to its success than the quality of the business or industry in which the company operates.
Posted by: Brian Horey | Oct 27, 2005 8:00:37 PM
I don't no if all of those qualify as cliches. I've only heard a few of them, so they sound pretty original to me.
"There's no there there" is a quote from Gertrude Stein in reference to her return to her childhood home of Oakland, CA. I didn't realize it was so widely known.
Posted by: laura | Oct 29, 2005 7:03:05 PM
It might be a liguisitic anomaly specific to Texas (Like "Coke, soda or pop"), but I tend to say: "It's not our first RODEO" instead of "It's not our first BBQ".
Posted by: Marc Nathan | Nov 18, 2005 1:35:09 PM
Thanks for sharing.I just wrote a post on similar cliches or buzzwords. Apparently, there is enough material to write a book :)
Posted by: Damon Z | Mar 28, 2006 8:12:04 PM
My favorite from raising money is the following conundrum:
VC: "We invest in those companies who are focused".
Me: We are extremely focused on delivering this solution to this market.
Not five minutes later....
VC: "So tell me 4 or 5 markets would sell this too."
Me: "I thought you wanted us to be focused?".
VC: "Sure, but we want to make sure you can 'scale'".
Me: "You mean in case we fail and our focus is not the right one?"
VC: "Well, yes".
Me: "Great. Now where were we?"
VC: "We were talking about focus."
Me: "Yeah, kind of ironic, isn't it?"
Posted by: Steve Fisher | Feb 2, 2007 12:26:36 AM
