THE GOOD WIFEI’ll admit to a blatant bias.  I thought associates at VC firms, no matter how well intentioned, did nothing but waste founders’ time.

At EchoSign, I’d get dozens of “Big Fan of Your Product” emails from VC associates, at a time when I really didn’t need any capital, and they’d each burn an hour of my time with seemingly mundane questions.  And I really didn’t think they were such a Big Fan of our product.  Rather, I thought they’d just seen some press hit or award we’d gotten.

Worse, I had scar tissue here.  In my first start-up, our first term sheet came via an Associate.  This Associate had no real juice at the venture firm, and the end result was the most tortured term sheet I’ve ever seen.  It was so tortured, that I completely rejected it without any other offer, or at the time, even any real hope of any other offer.  It was that convoluted 😉

But …

I was wrong.

Lately, I’ve had an opportunity to get the True Story behind a lot of successful venture-funded start-ups.  And you know what I learned?  In maybe 50% of them, the originator of the deal, of the venture investment, wasn’t a General Partner or the equivalent.  But an Associate, or Principal, or Venture Partner, an EIR, or something similar.

Why is this?  There seems to be one common thread.  Established partners at venture firms get busy.  They spend 50% or more of their time with existing investments.  They have to do their own fundraising, their own customer/LP meetings.  They spend a lot of time networking and connecting.

And so, sometimes at least, this just doesn’t leave a ton of time to discover brand new companies.  Especially ones that don’t come in with a 100% hot lead.

Contrast that with a VC Associate.  What else do they have to do, but try to source deals?  In many cases — not much. 😉  And if they find something good … they have a strong incentive to promote it internally and sell it up.  ‘Cause that’s 100% of their job.

So yes, getting a nibble from a partner is better than an associate — it’s a faster, higher odds path to funding.  But if you don’t have a ton of partner nibbles — getting funding going through an Associate clearly works.  A lot.  Maybe as often as at 50% of the best start-ups.

I was wrong.

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