Recently, we got ahold of an investor letter from one of New York’s finest late stage venturefunds. The letter shared insights intowhat the fund looks for in a management team, which resonated with us. Below we share these points, verbatim.
Welike CEOs that are patient with us and believe that all questions arereasonable. CEOsthat roll their eyes at questions, try to convince us that what we’re asking isnot important, and then don’t have good answers are the ones we are suspect of.CEOs that demand investment decisions without answering any of our questionsare ones that we’ll run from. A good management team is one that will try tounderstand why we’re asking questions, then give good answers, rather thandismissing them.
Welike CEOs that are willing to share lots of information, and do not selectivelywithhold certain pieces of data we ask for. Many times for instance, we’ll ask for historicalboard decks to understand how a company has performed against plan. When we askfor the data many times and never receive it, we know there is something off.
Welike strong, detailed reporting. When companies have management metricdashboards that align deeply with the KPIs that we feel are important to abusiness, it gives us great confidence. This means they are managing to numberswe care about and are of like mind to us.
Wealso like when CEOs ask us for our (and our LPs) input on what they should careabout, because it shows a willingness to collaborate and a desire to learn. While we don’t claim to have all the answers to anything, we ourselveshave decent experience, and our LPs are some of the most successful people inthe world. If a CEO doesn’t want to extract anything from us, this is one we’lllikely not be as interested in.
Welike CEOs who are willing to say that they don’t know an answer to a question,rather than fumbling through it.The most intriguing ones are the ones that jot down the question, andproactively come back to us with answers after some time has passed.
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