VCs are Humans ;-) Day 2 of IESE Meets The Valley 2013

Our second day in IESE Meets The Valley was: “Getting funded”. Today we met with several amazing VCs and individuals. VCs are sometimes seen as numbers driven, cold etc. But my biggest discovery was: VCs are humans too. It is not all about the numbers. In the end; business is done by human beings. I will present you with 3 proofs of why VCs are humans in this report of Day 2 of what has been an amazing trip. Follow us on Twitter via #IESEmtv to get constant updates and photos.

Proof #1: Asset Management Company

We started our visit with Asset Management where Pitch Johnson and Rich Simoni gave us a great introduction to VC investing. They both shared stories and answered the questions we sent beforehand. One remarkable thing was that the returns they experienced were much better than the 1 out of 10 successes that are normally reported. So there is hope for us founder ;-). They also shared anecdotes of how there were great opportunities but human choices (sometimes irrational) in the end influenced the outcome. One example was a CEO that got offered an amazing opportunity but did not feel like moving his family to California.

Proof #2: Dorsey&Whitney / Garage Technology Ventures

Our second visit was with Dorsey & Whitney, a firm that is starting to become more and more familiar with IESE. After a talk by Terry Kelly about patents and founding best-practices they served us an amazing lunch at a nearby restaurant we were truly spoiled. There Bill Reichert from Garage Technology Ventures joined us and held a keynote. He shared the 10 lies of entrepreneurs, the 10 lies of VCs and there 3 steps to WOW framework. The latter is a replacement to the elevator pitch: “no one is on elevators with VCs very often, especially not here where there are no high buildings ;-)”. With the WOW effect Bill described that VCs often don’t invest rationally. They fall in love with the idea / team and then come up with the rationale for the investment, this is proof #2 that they are actually human 😉

Proof #3: KPCB’s Randy Komisar

Kleiner Perkins  Caufield & Bakers (KPCB) is one of the most famous VCs in the world and was our 3rd visit today. There, we met with Randy Komisar, author of bestseller: The Monk and the Riddle. Randy shared his philosophy of innovation and investing. Randy shared many things with us. But one thing that he shared is that there must be a click with the entrepreneur. Sometimes he even gives his services for free for three months to get to know the startup. Proof #3, for all of the VCs we visited the relationship with the entrepreneur can be a deal breaker.

The VC Dinner

We closed our day with our VC dinner. This was an amazing event hosted by Asset Management at a private Stanford club. Pitch Johnson had invited 4 VC friends that sat at the table with our students. The students could then ask questions. These people have been laying the foundation for Silicon valley for a long time and their stories were amazing. One of the VCs shared his vision about how the education system as we know it will be drastically disrupted over the next decades. This was also highlighted by several of the VCs that day. Luckily he agreed that the case-study method we use at IESE can probably never be done online. So my business school will be around for many years to come!

Jet lag has really hit now, but tomorrow we go on to the 3^rd day: Scaling businesses.