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Hi, I’m Brad Feld, a managing director at the Foundry Group who lives in Boulder, Colorado. I invest in software and Internet companies around the US, run marathons and read a lot.

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Dear VCs: What Happens When Your Words And Your Actions Don’t Match

Comments (35)

Almost exactly a year ago I wrote a post Your Words Should Match Your Actions. It was a generic rant that resulted from me watching a couple of VCs blow up their reputations with entrepreneurs I know because of how they treated them.

This morning I ended up on an email thread about this. I’m going to anonymize it, but you’ll get the point. The two people (who I’ll call “Entrepreneur” and “VC”) are both very successful, extremely smart, and very visible.

Entrepreneur: Thread below is 2+ years old, but resulted from VC asking me similar questions. Interestingly, when I (a year later) pinged VC about my new company, not even the courtesy of reply from him. Bad mojo. :-)

Me: Welcome to the “assholeness-VC-factor.” Hey – I’m important – give me info. Oh – you are now raising money – fuck off.

Entrepreneur: I’m amazingly appreciative to short, polite “no thank you’s”. I don’t know whether VCs think that’s too much work, or whether they want to leave open the possibility of the “must have been caught in my spam filter” excuse when the startup becomes a rocket in 2 years?

I then went on a more serious rant explaining what I think is going on.

It’s worse that that.

In my book Startup Life (that I wrote with my wife Amy) I said that one of the key things that has made our relationship work is that I realized “my words had to match my actions.” After about decade of telling her she was the most important person in my life, and then being late to dinner, canceling things at the last minute because something else came up, or taking a phone call without even looking at who was calling when we were in the middle of a conversation, she’d had enough and our relationship almost ended.

My biggest behavior change 14 years ago was to focus hard on having my words match my actions, and my actions match my words. Simple to say, really hard to do.

Of course, it also works in a business context. I’ve learned, and deeply believe, that it’s the essence of being authentic. You can have any style you want – these two things just have to match up.

Sadly, many very successful people simply don’t understand or appreciate this. They put huge amounts of energy into developing a public persona. It could be PR, it could be speeches, or writing, or systematic campaigns over a period of time about themselves and their businesses.

But then their words and their actions don’t match up. Over and over again. It can be subtle or overt. It can be mild or jarring. It doesn’t matter – if they haven’t internalized the idea of their words and actions matching up, there is a long negative reputational effect.

And, as our email exchange demonstrates, it lingers. I have heard the same thing about that VC and I’ve experienced it personally. Yet his public persona is “entrepreneur friendly”, “very accessible”, “incredibly smart”, and “highly capable.” Yet, he completely blew you off, after asking you for something when you were a powerful and well-connected executive at a large company. Stupid behavior on his part.

Oh, and in addition, this VC missed a chance to invest in what is now a rocket ship. And the entrepreneur didn’t go back to him for the Series B because he got blown off the first time, so the VC missed two chances to invest.

Do your words match your actions? If you don’t know, ask yourself at the end of each day “did my words today match my actions.”

  • Aron Solomon

    No matter what one does for a living, you’re either a decent person (a “mensch”) or not. In the past year, I’ve seen some amazing, generous, kind, VC behavior, and other VC behavior that has been abhorrent. Massive extremes. We all need to be decent with each other. Always.

    • http://www.feld.com bfeld

      “We all need to be decent with each other. Always.” – I strongly agree and it’s ingrained in my value system. I hope I live up to my actions here.

  • Dave Girouard

    “No man, for any considerable period, can wear one face to himself and another to the multitude, without finally getting bewildered as to which may be the true.”

    ― Nathaniel Hawthorne, The Scarlet Letter

    • http://www.feld.com bfeld

      I love that quote.

      • M. Edward (Ed) Borasky

        Yeah – I should re-read my high school American lit classics ;-)

  • http://freepository.com John Minnihan

    the common courtesy + 10 secs it takes to reply ‘no thanks’, ‘not my area of focus’, ‘too early for me’ or [whatever] seems to be a lost art. Some of the busiest, most successful (by many definitions, not just $$) people I know reply to my emails rapidly + always answer my (infrequent) phone calls.

    What I find really unprofessional + deeply assholeish is when VCs *do* initially connect but then go dark. Even worse are the ones who promise a very specific next step (“I’ll call you at 3pm Friday”) and then… nothing.

    It’s amazing folks doesn’t start naming names, because these puddingheads are the ones that give the good VCs a bad name.

    • http://www.feld.com bfeld

      There is no incentive to name names. That’s part of the reputational impact (it cuts both ways) – we are taught not to burn bridges in a professional context. Anonymous sites like The Funded and Secret / Whisper appear, but the fact to fiction ratio is too low and the effort by inauthentic people (and PR …) to game the dynamic makes the long term value of anonymous feedback useless (and possibly harmful since there’s no retribution reputationally for lying.)

      It’s a tough dynamic to fix, which is why it likely persists throughout our society (not just with VCs and entrepreneurs) at a deep level. And it doesn’t help that our visible political leaders are the worst offenders.

      • http://freepository.com John Minnihan

        yes, of course – I agree w/ all that. I’ve never named names publicly for exactly this reason.

        It just feels like there shld be a way to warn other entrepreneurs, aside from the snark- + innuendo-laden sites like The Funded. Like you say – tough to fix.

  • http://www.startupmanagement.org/ William Mougayar

    Well said.
    Entrepreneurs assess VC’s reputation. Entrepreneurs talk to each other and share their VC experiences. I think @fredwilson:disqus said that “reputation is the magnet that brings opportunities to you time and time again.”

    • http://www.feld.com bfeld

      Yup. The classic Warren Buffett quote also resonates: “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.”

      • http://www.startupmanagement.org/ William Mougayar

        I rest your case :)

  • dwanguard

    The problem is in general acceptance of not answering, because there is “valid” excuse of overload. Which in itself is obvious nonsense because if there is high traffic it is for the reason and contact itself is invited, yet treated as spam.

    This sends the sender a message that his invited reaction for which he invested considerable effort is nuisance.

    Such behaviour further communicates that it is acceptable not to hold to certain standards in other situations as well.

    Observing it just as mechanics it does not make sense and positive outcome can not be expected.

    • http://www.feld.com bfeld

      I find the “sorry – I get too much email and can’t respond” to be a weak excuse. If you’ve put yourself in this position, change your process or your filters. Being overloaded is a process issue that can be addressed.

      Now, if the person sets the public expectation that they won’t be responsive, that’s totally cool. Remember: words and actions need to line up…

      • dwanguard

        Exactly, nobody would argue when you are straightforward and respectful. “No communication” is bidirectional final statement, no invitation, no expectation.

        But at the same time, in the era of internet and globalisation to even consider that path is another contradiction.

        And in the very segment that is advancing global communication.

        The whole process can be much faster for all participants.

  • http://www.thekitchensync.co Laura Yecies

    It’s not just VC’s – though they are, in my experience, among the worst offenders. When I worked at Netscape Jim Barksdale used to insist on good “business hygeine” – summarizing action items, following up as promised and replying even if it’s a no. It’s amazing to me how many people don’t maintain that and I think it must eventually come home to roost.

    • http://www.feld.com bfeld

      Yup – it’s pervasive.

    • adamcaper

      Laura -

      That’s a great anecdote.

      I’ve been using the “good hygiene” concept myself for quite a long time (I tend to think of it as “relationship hygiene”), and make that an absolute requirement for anybody who works for me. To my mind, it’s really a matter of character & manners – recognizing that there’s a person on the other end of the transaction for whom the issue may gate some next step, or perhaps it’s a simple as the fact that they’ve put time and effort into the situation which deserves respect in its own right. We used to call this the Golden Rule, and of course there’s Kant’s Categorical Imperative (http://en.wikipedia.org/wiki/Categorical_imperative), which boils down to a general rule of reciprocation.

      The bottom line: be a tad considerate to people and do your part to help keep the world spinning as it should.

  • ObjectMethodology.com

    This is a nice example of why I’ve been saying using email is a bad thing. Or any other electronic communication that leaves people not knowing if someone received a message. Email, text, etc. An assistant could have filtered it wrongly. Or is was lost in electronic limbo.
    .
    If someone can’t bother to talk with you in person or at least on the phone. Are they really the kind of person you want as a partner (in whatever capacity)? Do they stretch their self too thin? Do they need to discuss everything with someone else before responding because they really don’t have the skills they market? Is your endeavor just one of many on a long list feed into a numbers game?
    .
    This doesn’t only apply to VC’s. I’m currently selling IT services and when I find a prospect difficult to get in touch with or not focused, I drop them as a prospect. It may sound bad, it does to me, because the customer should be #1. But I wonder if you can really hep a customer that doesn’t care enough to help their self by being organized and focused?!

    .
    Until you’ve talked with someone in person or at least on the phone. You don’t really know anything about that person. You only know the electronic communication process they have in place. Public persona’s are rampant and if you want to build a relationship with a persona so be it. But if you want to build a relationship with a person you can’t do it by building a relationship with their computer systems.

    • http://www.feld.com bfeld

      So how do you deal with someone like me who hates the telephone? I try to never spend time on the phone unless either (a) I have to or (b) it’s with someone I already have a relationship with and am working on something with, and even then I’d rather not do phone.

      • ObjectMethodology.com

        I think you’ll understand if you just ask yourself: How many venture deals do you sign without ever meeting the people in person? I’m not talking the smallest but the largest of the deals.
        .
        If I’m just chatting informally with someone then I’m OK with email or other methods. But when it comes to business I want to try my best to ensure success. That means getting to know someone. Finding out if they are going to work hard to reach our objective. Seeing if they can answer questions off the cuff. Knowing if they will be in the office everyday or at a bar sending me messages via smart phone until I find out they get no work done.
        .
        I know your big with the web and I dig your success. We have more start up incubators or other help than we’ve ever had. But we still have huge unemployment. A 2.9% drop in GDP first Q of this year. The worst in 8 years. I spend a week sometimes getting something done that would only take an afternoon if people were to *prepare and get together to get things done.”

        .
        So I guess to answer your question. I deal with electronic only situations the only way I can. Feeling a little like I’m not ever sure where I stand with things. Feeling like I’m not sure if who I’m email with. Feeling like I don’t know if someone is real or a public persona.

        • ObjectMethodology.com

          *** Feeling like I’m not sure of who I’m emailing with.

        • http://www.feld.com bfeld

          I totally respect your approach, but mine is different.

          And, I’ve actually closed plenty of deals without ever meeting the people in person.

          • ObjectMethodology.com

            You’re on the VC end but would you recommend that someone take on a co-founder without ever meeting them in person?

          • http://www.feld.com bfeld

            Nope. But I also wouldn’t recommend someone take on a co-founder after just meeting them once in person.

  • http://about.me/frank_miller Frank W. Miller

    One thing I learned was VCs NEVER say no thank you in the short definitive way you are hoping for. The impression I’ve been left with is they don’t want to walk away from a potential winner. They need 10 baggers to stay alive. A lot of times they see companies before the company has talked to other VCs. They might think you’re stupid and your business has no chance but they don’t really know any more than you do about whether you’re going to be successful. What it really comes down to is if you go talk to somebody else and they become interested, they want to be able to jump back in as part of a syndicate or something. Brad, you might be different (or you’re better at managing your image as someone who doesn’t do that) but everybody else that I’ve ever met is exactly that way.

    • http://www.feld.com bfeld

      I know a number of VCs who say “no thank you” all the time, multiple times a day. So I don’t think it’s a NEVER or NONE EVER DO, but there are many who fall in the category of what you describe.

      Re: “Managing your image” – I don’t try to manage my image in any way whatsoever. That was part of the point of this post – I do what I say and I say what I do. Sure – I screw up and fail at this occasionally, but I also own my mistakes when I do.

    • http://freepository.com John Minnihan

      I’ve talked abt this before, so to those who’ve already heard it – imagine me telling a motocross story or something here -

      Speaking for myself only, Brad + a handful of other VCs do say no (or ‘not now’ or ‘not my thing’) quickly + without drama. Brad has said no to me 2 or 3 times, as have a few other VCs, most of whom I consider close friends. That creates a dynamic that vacillates between helpful + too honest – I can ask these folks anything + get a candid, honest reply. Being able to communicate with no filters like that is huge time- + energy-saver. You just have to be prepared for the occasional ‘I love you, but that’s the most obvious thing you cld have possibly said’. Not that I recall stuff like that.

      But I’ve also dealt w/ the buttheads, as I point out in an earlier reply.

  • adamcaper

    Brad -

    Thanks for this.

    I’ve recently gone from being on the investor side (I designed and helped start some CVC programs as a consultant, and co-managed one for a couple of years) back to being an Entrepreneur (building a SaaS product based on IP I developed during the time I spent running the consulting firm). I have been BLOWN AWAY by the shit treatment I’ve received from some of the guys who most aggressively snuffled their noses up my butt when I was on the other side of the table. Just incredibly amazed.

    I want to be clear that this is not because I expect them to fall all over themselves to invest in my deal – I’m no more entitled to their money, or even their time, than anyone else. But what is amazing to me is that we both know so many of the same people (and they know it), so they’re risking their reputation in their own network!. Yet they can’t seem to do the math that a polite “thanks but no thanks” or “not right now but please keep me in mind for [the next round, when you've got more traction, when you have a few validating customers, whatever]” is the least they should do for their own benefit. Astounding!

    As you’ve pointed out, the behavior is irrational and self-defeating –
    they miss out on deals, harm their reputations, and generally narrow
    their potential success vectors. And yet the behavior is epidemic in the
    industry. They’re certainly not seeking to maximize their financial
    success – we all know that humility is highly correlated with long-term
    financial success, both in terms of maintaining a clear perspective and
    in managing relationships.

    I think the problem here is psychological, and has to do with some (many?) people’s true motivations for climbing the VC career ladder. Simply put, the business attracts people who like to feel powerful, and there are few constructs in business more amenable to a cheap sense of power than playing the inaccessibility game. We’ve all seen this in action – people put themselves in a position in which one of their biggest job functions is to be pitched, and then they behave as though the person doing the pitching is beneath them. I think it’s like a little snort of ego cocaine – just a cheesy way to leverage the fact that a deal isn’t in one’s wheelhouse to get that added frisson of “I’m a big shot” to which their addicted.

    Anyhow, great post. You have a long history of sticking up for the little guy, and that’s a pretty cool thing.

    • http://www.derekscruggs.com/ Derek

      Not sure if this applies in your case, but one thing I’ve learned that helps remove tension is to ask for the “no.” http://www.derekscruggs.com/slow-turndowns-bad-up-front-contract.html

    • http://www.justanentrepreneur.com PhilipSugar

      This isn’t just VC behavior. Its the biggest shock for people that had great educations, went to work for great established companies, were very successful and then start their own gig.

  • http://www.linkedin.com/profile/view?id=8465000 AlexHammer

    Good post. You raise a lot important points and it is insightfully written.

  • http://www.justanentrepreneur.com PhilipSugar

    Here is what I think: The more successful you are the more people will indulge in your bad behavior. Its totally true. I watch it. Its really different from when you start a company in a garage, to become successful, to sell it, to become a SVP at a big company, Its really different when you are a Goldman Sacs or McKensie partner versus some schmoe nobody knows.

    Now for many people they think they’ve earned that. And I suppose if you are working in that feudal system its a right of passage.

    Here is the problem: when you work with people outside that system, they will think you are a total fucking asshole. Because…..you are. Your wife doesn’t think that she is some minion. Think about the treatment when you check in to a really nice hotel, versus just checking into a cheap one. I’m not saying stay one place or another, but sometimes its important to remember that no matter what people treat you different so as to be grounded.

    The non-reciprocation is even deeper. This I call me-me. That has become more pervasive. Its about me and I don’t give a shit about you. People are shocked when you point it out. I’ll come up to somebody and say hey me-me can we maybe think about the rest of us here for just a tiny bit?

    • http://www.feld.com bfeld

      Love it. And yes – these people have become total fucking assholes – that’s exactly the right language for it. And over time they become big broken bags of glass – one of my favorite descriptions of a completely self-centered sociopath. Every time you try to hug them you cut yourself, sometimes fatally.

      The reminder of the way we treat people on a hotel staff is so telling. Do you say thank you to the check in person? Do you say thank you to the person who cleans your room? Do you say thank you to the maintenance guy who fixes your TV or your toilet? Do you say thank you to the bellman. Sometimes it’s just saying thank you – human to human (or not) that sets people apart.

      • http://freepository.com John Minnihan

        “Do you say thank you to the person who cleans your room?”

        I’ve left a cash tip on the bed each morning at every hotel I’ve stayed in for at least the past 15 years. I always place the cash in a folded-up piece of note paper from the desk + draw a simple smiley face on it.

        • http://www.feld.com bfeld

          You are a smart and awesome person.

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