I Nearly Died Laughing When a VC Told Me the #1 Metric He Uses For Deciding Which Startups to Fund
You’ll be surprised by the kind of research it requires
As anyone remotely involved in the startup ecosystem understands, investing in startups is extremely risky. Simply put, most people would be better off going to Vegas and playing blackjack than writing a check to an entrepreneur.
However, as we also know, big risks have equally big rewards, which is why venture capital exists. But the venture capitalists who invest money successfully aren’t just lucky. They also develop sophisticated strategies for choosing which startups to invest in.
Or rather, as a young entrepreneur constantly fundraising, I always assumed the VCs I was meeting with had sophisticated strategies for making their decisions. Now that I’m older and not fundraising, I’ve become friends with a few VCs, and, as a result, they’ve opened up to me about their investment strategies. I’ve been surprised to discover that not all VC investment strategies are as sophisticated as I expected.
To be clear, most of the strategies VCs use to make investment decisions are, indeed, well-researched, thoroughly analyzed, and grounded in copious amounts of data and expertise. After all, if you were spending millions…
