Thought Leadership Threads

The Evolving Landscape of Venture Capital: Are Emerging Managers DOA?
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There’s been a lot of debate lately around whether the VC ecosystem is being negatively impacted by the largest firms hoovering up LP money at the expense of Emerging Managers. The observation is real and it’s becoming increasingly clear that the venture capital industry is at a critical inflection point.
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But the phenomenon isn’t new. It’s been unfolding for years and was easy to spot. I wrote about it a few years back in a presentation titled “The Three Body Problem: Finding The New Stable Points In Venture Capital” and I’ll add a link in the replies if you’re interested in learning more.

Investors often tell Startup Founders that the distinction between success and failure often comes down to one critical factor: Speed.
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Startups exist in a unique ecosystem where time is both their greatest asset and their most formidable enemy. Every day counts in the race to validate ideas, acquire customers, and achieve profitability before running out of cash.

There are snippets in the news every day about the how various currencies around the world are moving.

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The US Dollar is strong. The Japanese Yen is weak. The Nigerian Naira has erased its recent gains. The Venezuelan Bolivar has been crashing. Are you curious what all this means and why certain currencies are “strong” while others are “weak”?

In the rollercoaster world of startups, grit isn't just a nice-to-have. It's the fuel that propels companies through the inevitable tough times that precede success. But while everyone thinks they know what grit is, most definitions aren’t precise enough to be useful.

Courage? Conscientiousness? Perseverance? They all miss the mark.
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What follows is a tangible and actionable definition that I’ve found to be quite useful when advising Founders:
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Grit = Vision + Control

Each startup is a unique beast. Until it “cracks the code”, it's just a representation of a Founder’s vision embodied in a business plan.
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And a typical VC Investor will review hundreds (maybe thousands) of these unique pitches every year. Each VC has their own underwriting process, but it's not as formulaic as one would expect given the volume of work moving through the machine.


Because of the unique nature of each startup, company specific underwriting questions need to be answered for any given VC to build conviction around what the Founder believes can be built.

The allure of the Startup world is undeniable. The potential for explosive growth, the thrill of innovation, and the chance to change the world fuel Founders.

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However, the road from a bright idea to a sustainable business is riddled with complexities. Getting a startup to "work" isn't simply about doing one thing well. Most startups are extremely complex and require many interconnected parts to all function in concert.

Landing The Plane: A Necessary Choice For Many Startups
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How many Founders does it take to land a plane? None, they'll just pivot to a helicopter ride-sharing service.

There’s a saying that first time Founders focus on product and repeat Founders focus on distribution.
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The lesson that’s been learned by repeat Founders is simple:
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The top reason startups fail is due to an inability to scale efficiently.

It's been a tough funding environment for the past 2 years, but even in this brutal environment great startups have been able to successfully raise the capital they need.

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And even for the best startups, the fundraising process proves to be exhausting and time consuming. So once a raise is "done and dusted" there's always an amazing feeling of relief.