VC Cliché of the Week

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VC Cliché of the Week

I was talking to a group of MBA students yesterday and got onto the subject of what makes great entrepreneurs.

The first thing that came to mind was United States Supreme Court Justice Potter Stewart's comment, "I can't define pornography, but I know it when I see it."

Well I can't define what makes a great entrepreneur, but I know one when I see one.

Pattern recognition is a powerful thing. I've been doing venture capital for twenty years now. I have personally backed over 50 entrepreneurs and I've been in venture capital partnerships that have probably backed over 200 entrepreneurs. I have watched which of them have succeeded and which have failed or flailed. And you learn things.

I believe you can see it in their eyes if you look hard enough. There's a sparkle, reflecting the energy and enthusiasm they bring to their projects.

Here are the characteristics that I find most commonly in great entrepreneurs:

- Super bright, smartest person in the room syndrome
- Engaging, compelling, social personalities
- An insatiable passion for creating things
- An expertise and focus on the product
- The ability to rapidly mediate between the market and the development team
- A hunger for the big hit (ie the payday)
- A flair for PR and marketing
- The ability to listen to and really hear what others are saying

I am sure that others would have very different lists and as I alluded to at the start of the post, there really isn't any formula for defining what makes a great enterpreneur.

But I know one when I see one.

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Posted April 12, 2006 in Venture Capital and Technology

Comments

These thoughts hit home!!!

They say everything happens for a reason and I believe it does. I also believe that when you are "hot" on something, your sensitization creates these happenings. I am an MBA student who has struggled to find my career home...needing constant change, being engulfed by the cutting edge, outgoing and passionate, loving to learn and teach others....all have seemed to pull against each other. Traditional investment banks or product managers never fit the bill for me. I believe my spirit and drive have pushed me into the place I need to be. Now i just need someone to convince someone to hire me :-)

Posted by: matthew | Apr 12, 2006 10:11:29 AM

Fred: Are you using the word "great" to mean "successful"?

Posted by: Dossy Shiobara | Apr 12, 2006 10:14:06 AM

character? (integrity, trust, word is bond?)

candy store test? (operating ability to get things done, attention to detail, priorities, follow through)

Posted by: curmudgeon | Apr 12, 2006 10:38:27 AM

i would also add a few others:

- lack of concern for being different / doing non-conformist action
- confidence in the face of multiple opinions to the contrary
- general oddness in a few social behavioral areas

note that these traits can mark for poor performance as well as good. the interesting thing is the outlier social behavior allows (enables?) very unusual activities, which can then lead to interesting results -- again, both good or bad.

i've noticed multiple times that entrepreneurs who have these odd traits show up as successful folks -- and also those who crash & burn on occasion as well.

(and btw, i once argued against the ability to prove/disprove the existence of god with my entire 4th-grade class and teacher ;)

- dave mcclure

Posted by: Dave McClure | Apr 12, 2006 12:14:45 PM

Matthew--why don't you hire yourself?

Posted by: charlie crystle | Apr 12, 2006 12:30:49 PM

How about Leadership? - the ability to quickly recruit, retain, and motivate employee's, investors and customers/users.

Posted by: Jeff Schrock | Apr 12, 2006 12:46:09 PM

Hello I comes from Austria and by coincidence into the Blog came, you writes here over a Intressantes topic at opportunity would like I with it to enter more in greater detail and express, but to me still different Blogs regard to I defenitiv commit myself. Until soon and kind regards from the alpine country Manuel.

Posted by: Manuel | Apr 12, 2006 5:25:41 PM

Stewart's quote referred to "obscenity," not pornography, which may or may not be considered obscene.

Posted by: Dave | Apr 12, 2006 5:41:00 PM

Central factors in Roman success

This section will not repeat the heavy detail of other articles on things like specific items of equipment, camp layout, political leaders, etc. except in terms of analyzing (via concise summaries), the elements that made the Romans an effective military force, both tactically and at higher levels. A fair appraisal should analyze how the Romans learned from their defeats, and isolate the central factors responsible for Roman success over the long run. Five are offered here where cover both naval and infantry forces:

* The Romans were able to copy and adapt the weapons and methods of its opponents effectively

* Roman organization was more flexible than those of opponents

* Roman organization and systemization sustained combat effectiveness over a longer period

* The Romans were more persistent, and willing to absorb and replace more losses. Unlike other civilizations, the Romans kept going until their enemies have been neutralized.

* Roman military leadership while disastrous at times, was satisfactory enough to ensure success

http://en.wikipedia.org/wiki/Military_history_of_the_Roman_Empire

Posted by: Dimitar Vesselinov | Apr 12, 2006 6:37:07 PM

I will be surprised if this post does not get wildly diverse opinions on this. Speaking for myself, I might match a couple of these 8 traits you posted. Either I give up my entrepreneural ambitions or try and use what I got!

Posted by: Srini | Apr 12, 2006 8:08:19 PM

Can you do a post on pattern recognition? I would like to hear more on that...thks

Posted by: Thomas | Apr 13, 2006 1:52:12 AM

I second that request for a post on pattern recognition.

Posted by: Audrey | Apr 15, 2006 10:21:04 PM

Great post. I wrote an article on the topic, but focused slightly more on common patterns for software entrepreneurs.

Seeking Stellare Entrepreneurs

Posted by: Dharmesh Shah | Apr 19, 2006 10:09:16 AM

Pornography: That which provokes lust, rather than love.

Perhaps I should be a supreme court judge. But then I wouldn't be an entrepreneur :)

Posted by: Julian Ellison | Apr 24, 2006 9:43:37 AM

A VC

Musings of a VC in NYC