Venture Capitalists at Work: How VCs Identify and Build Billion-Dollar Successes by Tarang Shah

Key Takeaways

  1. The key to start-up success is purity of motivation. The most successful entrepreneurs tend to start with a desire to solve an interesting problem—one that’s often driven by a personal frustration.

  2. Successful entrepreneurs also have this ability to articulate a roadmap for the sort of things they want to build over time. We rarely do business with a company where there’s a six-month roadmap and then it’s all done.

  3. People with “great DNA” see problems—and they roll up their sleeves and try to solve them. It takes a very special person to do that.

  4. I invest in stubborn entrepreneurs who chase huge opportunities

  5. Maples: I think the tech business is just fundamentally characterized by—Darwin had a term for it in evolution, “punctuated equilibrium”—where the world is evolving a certain way and then bam, it changes completely and fundamentally. You can even see this in the fossil records. Where the fossils progress at a certain rate, and then bam, there is a whole new layer of sediment that looks fundamentally different. The theory is, maybe there was a flood that wiped everything out or some new organism adapted and survived and crowded the old organisms out. I think to make money as an investor in the tech business, you have to find those. If you cannot find any of those ever, I think it is hard to argue that you have a business.

  6. Maples: We do not even think that much about our portfolio. Every company we look at, is there a chance it could be something huge if things go our way? To us, there is nothing else. There is no other question that matters. There is no other analysis that we care about. That is all there is.

  7. Most of the best deals that we have done would not have survived the scrutiny of a partnership.

  8. We do not look at serial entrepreneurship as a positive trait. We look at authenticity and unconventional, proprietary insight as the key difference.

  9. The thing I have found most interesting is that the best deals we have done are the ones where we decided the quickest—which is counterintuitive to me. I would have thought that the ones where we did the most diligence and the ones where we thought about it the most would be the most successful, but in fact, that is not the case.

  10. He said all the successful companies he has seen have this one following factor: they have a leader who gets the team excited by offering them focus and the clarity of what to do.

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