I have done a few good deals, and a few bad ones. In the good ones, I was best described by my board as a pain in the ass, but I got the job done so there were few regrets in the end. But I never worked with that particular board again, not because I was told to go away, but because I felt I had slighted a few folks (in other words, I was embarrassed, so I just grabbed my hat). Behaviour modification kept me from getting burned in the bad deals, as I learned how to walk when walking was the best option, and in the good ones I now keep my mouth shut much more often. Still, I had some self-doubt – now I wonder if that anxiety was ever justified to begin with.
Michael Moritz, venture partner extraordinaire from Sequoia Capital, has run into some entreprenuers that make me look like an absolute angel. Mr. Moritz goes as far as to call some of the founders he has invested with sociopathic, and frankly I can’t blame him. Among the company leaders he has placed bets with are a CEO who kept a gun in his drawer and trained wolves for a hobby, one with a big drug problem, and another who tried killing his co-founder with a pickup truck.
I am not big on guns or wolves, I run from drug users, and just traded my pickup truck in, so I think I am safe from comparison. But I still busted a lot of balls, and thankfully Stewart Alsop of New Enterprise Associates thinks that’s not necessarily a bad thing. The previous link from the Venture Capital Journal also has some good points taken from other big VCs, with a particular bent on arrogance as one of entrepreneurial qualities that requires careful consideration. I discussed the topic of extreme arrogance some weeks back, and cut to the chase by stating that narcissists are to be avoided at all costs. Longtime angel Roy Conway expounded on the point, and as he was one of the seed investors in Google, maybe I am not so crazy after all.
There are some good lessons to be learned – ones I have taken to heart and I hope other entrepreneurs will too. Venture capitalists invest in people, and people need more than just money. You better be willing to take advice as well as cash. Smart investors are going to check you out (whether you like it or not). If you have some skeletons in your closet, that isn’t a deal breaker, but you better aire the dirty laundry sooner rather than later – you waste everyone’s time otherwise. And integrity is one of the most highly regarded qualities in a company founder – I won’t deal with anyone who smells funny, and top VCs won’t either.