Ultimately, once you understand how venture investing works (which is very, very different from angel investing), I believe only two things matter:
- One, being picked by at least some of the best founders. The best founders always have options. It’s not just about “winning” the deal. It’s about being picked by the great ones. At least, enough of them per year to hit your investing quota. There are many reasons to be picked. Track record, celebrity, value-add, reputation, brand, platform and more. But if you aren’t picked, you have to invest in spaces, geographies, and niches where truly the very, very best founders have far fewer options. Otherwise, even achieving 1x is difficult. Look at the disruption of and Andreesen … they did what it took to be picked by many of the best.
- Two, pick well from who picks you. Now being a good “investor” comes into play. Because the difference between a Very Good and a Great founder and start-up is subtle in the early days … but huge as time goes by.
The best VCs find a way to do both.