Some thoughtful early planning can lay a great foundation for creating the kind of businesses other companies want to buy.
A venture capitalist I’ve been friendly with for a while was in town attending a board meeting of one of his portfolio companies. Having heard about his pending trip, I invited him to speak with my class of Duke entrepreneurship students.
At first, nothing the VC said was particularly unusual or exciting. He shared the story of how he became a venture capitalist. He shared some information about what he does on a day-to-day basis. And he talked a little about the kinds of helpful experiences students would need if they were interested in becoming venture capitalists. (By the way, in case you’re wondering, his main suggestion was to make sure you have significant experience working in startups.)
We eventually moved to a Q&A session, and, again, most of his points I’d heard dozens of times from him or hundreds of other VCs just like him. His responses to my students’ questions sounded almost like ChatGPT had written them:
One student aksed: “What kinds of things do you prioritize with the companies you invest in?”
“I’m looking to invest in a great founding team,” the VC answered.
Another student asked: “How much traction does a company need to have before you’ll invest?”
“My firm primarily targets B2B technology companies doing $1 million to $5 million in annual recurring revenue. But we’re willing to invest in any company — even just an idea on the back of a napkin — so long as it has the right founder.”
Yeah, sure… I thought. By “right founder” you mean you’d only invest in an idea on the back of a napkin if Elon Musk was the one pitching it to you.
Finally, one of my students posed a question the VC couldn’t solve with ChatGPT. “Based on what you’ve personally seen from the companies you’ve invested in,” my student began, “what are the clearest signs a startup is going to be successful, and how should we consider accounting for that as early as possible…