Source: Both Sides of the Table blog, Dec 2010
t’s why as an investor I look for talented teams with long-term vision, a unique point-of-view, differentiated IP and a desire to build something enduring. Often when I meet them the idea seems at odds with what others are doing and as long as it’s the right team with a well-thought-through plan I kinda like that. Only when their market becomes “hot” do they seem prescient and by then they have a significant lead.
Zynga wasn’t founded because they read about similar successes on TechCrunch, they built early and pioneered. FourSquare isn’t a “me, too” location-based recommendation service – it led in the category with check-ins and badges. It’s not surprising both have pulled ahead in their respective markets. I was reminded of all this this when I read a blog post by one of my favorite thinkers on the VC market, Bryce Roberts, who talked about “unfundable companies.”
“Reality is, at the seed stage, most rocketships look more like the cardboard variety you’d make as a kid than something NASA developed. Pour rocketfuel into your cardboard creation and you’re more likely to see it go up in flames than into orbit…
… I fear that, in this market, people are pouring rocketfuel into cardboard cutouts and no one is telling them. I strongly believe living through “unfundable” periods is important for long term success.
Consider it a badge of honor that most people think your idea won’t work. I’m certain that if you look at every single one of the entrepreneurs who’ve gone on to build big, enduring businesses they were unfundable once too.”
I love that. Bryce is a bit like the entrepreneurs I search for. He’s got a strong point-of-view on how OATV wants to invest, is willing to be proudly different from the rest, and is sticking to his plan despite the bull market that has been especially strong in his part of the market: early-stage investing. I suspect when the wind calms down Bryce will be well positioned.
My advice to entrepreneurs is to have a sense of purpose and stick to that regardless of what you’re reading in TechCrunch or Business Insider. Avoid the latest fads, trends or PR announcements. Don’t be psyched out by your competitors big financing round, latest product release or business development deal. If you know what your customers need, deliver against that promise and provide a product or services that has economic value you’ll do well. Double-down on great people, process & IP.