The four types of VC you’ll encounter as an entrepreneur
“While “firm-fit” is clearly very important and will save any entrepreneur and team who have it lots of time and frustration, ultimately venture capital is a people business. In the end, navigating the bumpy journey of building a large and important company out of nothing takes a lot of collaboration, engagement and alignment, all of which becomes very difficult without the right personal relationships and dynamic between the management team, investors and advisors.
In fact, in research by the Judge Business School at the University of Cambridge, entrepreneurs were asked: “what are the most important criteria in selecting a VC?” The top criteria for entrepreneurs was “personal relationship with individuals at the VC firm.” In second was “alignment on vision” and “economic terms” third. The quality of a personal relationship is obviously determined by a myriad of factors, but based on my 20-year experience of operating at the board level of VC-funded companies, I would argue that it is actually possible to derive some VC archetypes that could be helpful for entrepreneurs and teams to refer to when selecting their partner of choice…”