Some flavors of VC-startup communication
Ona semi-warm pre-autumn evening, I was re-skimming the notes I made within the last couple of months as part of a fall cleanup. I was initially hoping to find exciting topics to revive and follow-up on in winter.
Soon after defining this objective, I understood this little exercise had quirky side benefits. I quickly realized that each startup’s name called for a certain feeling in the gut — the company names jumped out at me like different flavors. Flavors that come out through a mixture of every decision parameter I can decipher.
- Product’s strength
- Team’s harmony or disharmony
- How the first meeting went
- Mimics and body language (the latter only to a limited extent these days)
These parameters are frequently part of our forward-looking discussion points with the team. We continuously try to develop systems that would rationalize decision-making within the team and document it for future use.
By now, I think we are all slowly concluding that there are millions of these parameters. It is impossible to be aware of and document all of them.
Some are based on hard facts, analyzed, and explored with the right methods. One of our team mates Sercan will talk about some of these points in his blog post soon.
Other parameters are harder to surface. They rely on many factors ranging from our childhood to current lifestyle and, finally, to everything we have learned. I’d like to showcase a tiny fraction of these parameters, which I believe has contributed significantly to the flavor I mentioned above.
The synesthetic robot that I am, I clustered the startups I have met over the past months into four different categories.
After reviewing the details, I realized that my clusters were highly dependent on our communication’s flavor. In the remainder of this post, I’d like to showcase these clusters and make my position transparent on how the relationship with the startups within these clusters impacts the wider Investment team and me here at 212. I hope it is helpful for the founders out there.
These teams deliver the freshest news. They have a short, well-structured, sometimes eye-pleasing, update mail in place. Packed with the latest news, delivered fresh to the inbox every week, bi-weekly, or monthly, like a neat little newspaper. They typically contain some relevant metrics, including the MRR, number of users and clients, something meaningful about churn, along with some qualitative feedback from the client on a recent feature. Additionally, any other non-metric piece of information on which the founder wants the wider circle’s opinion.
I feel a click away from them, and it is as if we are partnering up somehow already. The brief glance sparks connections, and we bring value by connecting them with others or share some recent things that we came across. This type of broadcasting permits a new learning circle to flourish. I love the lemons.
Additionally, I feel it is a good exercise for anyone that strives to stay connected to a large, highly specialized network.
Although not around all the time, some teams like to show up after the initial ping that comes from us. I’m not going to claim that this is the ideal case or the opposite, but the teams that manage to give a very satisfying inflow of information are also close to our hearts — when they are able to show up. It is intense learning whenever they come our way.
Giving a satisfying inflow of information is easier said than done, and I believe the teams that can do it in periods shorter than average are always impressive. The communication partner quickly gets the impression that the team has their stuff together. In our case, they have excellent quantitative and qualitative metric-based performance tracking systems in place, are continuously building and testing their assumptions on future growth, and design the organization as needed.
It is easier to build trust with good chocolates.
Some flavors make or break the dish, and you can’t ignore their taste. For me, and a critical mass of the world’s population (that I had the chance to meet and talk about cilantro), cilantro is one such flavor. Communicating with some teams makes me feel like we are the cilantro in their dish. I don’t think this is an accurate view.
While I think cilantro generally breaks the dish, I don’t intend to argue how bad cilantro is. I don’t believe VC’s can make or break the game teams are playing. It’s not in the VC’s interest to dominate the gameplay, to push for a decision that founders don’t agree with, or to slyly nibble on company shares. In our view, solidarity has the highest return — in financial and social capital.
While I know many don’t agree; cinnamon pleases me instantly. Gives a nice twist when added to traditional dishes. Cinnamon is my precious. I don’t want to spoil my cinnamon feelings by overdoing it with some challenge that forces me to shove a spoonful into my mouth and ruin my taste buds. No, I want to keep cinnamon as pleasant and light as it is in my life, forever. I feel some teams similarly approach their product and business. It is way too precious to hear anything negative. Some also don’t want to bury themselves in too much hassle and work to the extent of burn-out. This aspect sometimes shows itself in their speed of response to emails or data requests.
It is understandable. Still, it raises the question — will this team push through? We all need to push through.