Management

It’s a VC cliche that great management trumps a great idea.  In this case there’s a lot of truth to the cliche. Over the course of my venture career I’ve been exposed to all combinations of teams and ideas and am constantly reminded of not only the power of great teams, but also of the pitfalls of poor ones.  We’ve thought about this a lot at Foundry and have pushed each other hard on investing only in people we’re ecstatic about as entrepreneurs (and resisting the temptation to "fix" management teams that are not A+ or fool ourselves into believing that an outstanding idea is more important than the people who implement it).  This last point is often missed on our industry – I think there’s an incorrect belief that a mediocre team can push their way through a great idea. While certainly there are cases where a company manages to a great outcome with a sub-par team, my own experience has been unequivocal.  While I’ve had a handful of cases where – with the benefit of 20/20 hindsight – the idea we were pursuing was only fair but where a fantastic management team has managed to guide a company to a good outcome, I’ve had almost no cases where we’ve placed a company in the hands of sub-par managers and reached a happy ending (as I mention above there are some edge cases where mediocre teams manage to a happy place, but to me these are just lucky exceptions). 

It’s tempting at times as a VC to get behind an idea you’re really excited about with a team that you take on as a "project", just as it is easy to fall into the "here and now" trap when hiring a replacement CEO (or deciding not to replace an existing one who has grown a company as far as they can realistically take it).  Doing so is a mistake.  Bad management = bad outcome.  Not to mention that life is too short to work with people who aren’t great…