Love / Hate investmentsPosted: August 25, 2014
You all know the spiel about what VCs look for when investing – great teams, product, large markets, defensibility, yada yada. All makes sense. But I think that over time it is quite important that as a VC you develop an extra sense for the type of company that gets your blood flowing; much more ‘personal’ reasons for why you might be passionate about working with a team. We all only have so much time and energy – so passion and conviction is really important.
I had a great conversation with Danny Reimer last week about just that and somehow we ended up talking mostly about the companies we have gotten a lot of slack for. Fred Wilson nailed it with his return and ridicule blog post (it may just be my favourite investing blog post of all time). But ideally you don’t just want to get slack, you also want some people to love the company to death. This makes sense – if you disrupt a space you are going to make some people angry; if you are trying something unusual or hard a lot of people won’t (want to) get it and won’t like it. But on the other side you are probably hitting a nerve with a small community of folks that will give you a lot of love, because you are making life easier for them or you are giving them something they have always wanted.
So we agreed that what we really liked were companies where there is quite a lot of hate and love. Love / Hate investments.