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There is no ‘right’ path to prep to be a VC

In my post yesterday, It Takes $30mm To Train A VC, I commented:

Let’s debunk one notion immediately: being a successful entrepreneur (or even a failed entrepreneur) is absolutely not a criterion for being a good VC. The data is extremely clear on this – there is little correlation between the best VCs and past entrepreneurial experience. That is not to say that entrepreneurial experience is not an excellent segway into VC, it’s just not a required segway. 

There was some follow up to this statement in the comment section which prompted me to further expand on this issue.

Irrespective of the data (which speaks for itself), the rationale behind this statement is also important. Being an investor is quite different from being an operator. There are definitely overlapping skills between the two professions, but they don’t map one to one. In reality, many professions impart some of the skills necessary to be an investor, some more than others, but none give you the full exposure to it all. 

Equally important, there are simply different types of investors out there who bring different value to the table. Some bring operational expertise, some deep technical and product understanding, and some are killer deal people who will help you land a major hire, close a big BD deal or raise your next round. There is no one-size-fits-all box that we can fit all good investors into. 

Which leads to another important point. While monetary capital may be a fungible commodity, the human capital behind the money is certainly not. Entrepreneurs need to be extremely thoughtful about their needs and recruit people around the table who complement them and add incremental value to the company. This is the same exercise any operator goes through when you identify hiring needs within a company or think through the characteristics, skills and experience you want from your independent board member.  

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