100% agreed. Most VC funds are necessarily good at very specific skill: convincing people who control lots of money that the VC is smarter and better than their competitors. The easiest way to sell that is to truly believe it, and then perform that belief convincingly. That's not something one switches on and off, so their answers here are likely to be skewed in the direction of things that make them look valuable.
Things like "team" and "gut check" are especially useful answers for that, because a) it lets VCs sound like intuitive geniuses who can't easily be replaced, and b) the I-know-it-when-I-see-it nature of those lets VCs smuggle in all sorts of irrational biases. As one well-known investor said, "There was a guy once who we funded who was terrible. I said: 'How could he be bad? He looks like Zuckerberg!'" Points for honesty, but you can bet that wasn't the official reason they invested.
In general I agree with you, but I would say that alot of VCs either
1) diversify their investments amongst many areas in tech (or maybe some non tech things, not stereotyping all VCS but for this example I'll say diversity of problems being solved using technology/software etc) and thus see commonalities of problems amongst teams in their experience despite whatever the specific niche industry is. I think it is pretty important to agree the cofounders are important. Specifically I've heard from CEOs of startups I use to work for they are really good at hunting out "weaknesses" in the bonds between cofounders.
Basically, they don't want a good idea to fall apart because two cofoudners fundamentally don't see eye to eye, which will make it hard for any decisions they make (whether good or bad) to come to fruition and indicates future struggles with the company, in addition to weak leadership/unified approach when hiring new people, who might be disoriented at understanding the direction the company is going in.
2) Focus on particular niches (a startup who focus specifically on funding AI startups, for example) often they will even fund competitors knowing that if one of them dies, they are almost gauranteed to reep benefits from the remaining on in the niche field. This also means they keep a close track on the variations between two or more companies approach in a specific industry and why one failed and the other didn't.
Someone from Marc Andreessen's team recently published a blog post going into great depth about 5 factors amongst ten or so AI teams that indicated their levels of success in the field, and most of the tilting factors are not what I would say is common knowledge amongst AI startups.
They may have their biases, but they also have unique experience in understanding or seeing repeated dynamics in what could make a relationship (between cofounders) fail (like seeing that one bad relationship where the couple can't see it but it is so obvious to you because youve either now been through it or seen it happen before, imagine this for VCs looking at cofounders over and over again for ten years...) and otherwise have lost lots of money over failed business ideas, so I would say they are incentivized to be as objective as possible with themselves, even if just selfishly for the benefit of their own bank account.
If your point is, "Some VCs can be good at their jobs," I definitely agree. My point is more that all VCs have a strong incentive to appear to be good at their jobs, especially in ways that sound impressive and are hard to verify.
I really couldn't. E.g., I've hired a number of programmers who are terrible at self-promotion. And even many of the ones who are good at it talk about specific, verifiable, repeatable skills.
yeh I guess nerds are an exception to the rule, but honestly relative to all of the industries out there outside of engineering alot of business, marketing, etc etc is fluff. VCs are in business and finance.
At the end of the day, they have money. Assume they are selfish and want to not lose money, so they probably have some rationale on which they give out money in hopes for a return on investment. That being said, I've seen way too many tech bros with bad blockchain ideas get way too much money which usually goes straight to their heads before they lose it all, and I assume the V.C.s have a really good strike price and know exactly when to liquidate.
For others, it was my general understanding VCs lose money on most investments, hoping that a few end up going really big and canceling out the losses on the rest, but I don't really know anything about VC stuff. I'm not sadomasochistic enough to try to start a company, I just try to work on my skills and people are willing to pay me to invest in myself because I tend to discover interesting things while I tinker about and also keep things from failing often in a raging dumpster fire but I don't know if thats a good way to market my skills.
Nerds are not the only exception by far. Quite a lot of people making an honest living are reasonably honest. The people at my corner store are not going to BS me about what's in stock. The person cutting my hair has always been frank about what she's good at and what she's not. I've worked in a library, a restaurant, and a few factories; all were populated by people who were generally straightforward.
It's a relatively small percentage of jobs that require people to be good at manipulating the opinions of others. As you say, marketing is an exception to that, but their business is manipulation, so that's not surprising.
marketing, finance, ad tech. My point is most fields propogated by modern technology is propped up by VC and finance...
I have friends in healthcare as well, and I don't hear things are much better too, in regards to the business ethics of the healthcare system.
My overarching point is that anything that involves finance is likely to be corrupt, and VCs are just one segment of them, but there are a lot of more corrupt financial entities with way less transparency and as a result, way less criticism.
It's not really a fair comparison to match factory work, cutting hair, and being a cashier to being a hero of honesty in relation to finance related jobs. Take cashiers for example, their job is to accurately ring up listed prices decided by a much more complex decision making system, leaving very little decisions for them to mess up at that point, and anything they do unhonestly, is likely to be relatively black and white in comparison to the unethical lobbying behaviors multi billion dollar corporations that bankrupt farmers that farm the seeds they make to monopolize food markets, that the cashiers are ringing up.
Yes, VCs are able to lose alot of money and not really be accountable for it, but so are many other industries related to finance...
Not sure why you are so convinced VCs are the one evil entity in the thousands of permutations of finance, but if I had to call out evil entities in finance it would be the credit market, corrupt government, wallstreet investors, but atleast somewhere at some point VCs gave value to some entity you can track other than transiently through a stock from an algorithm to maximise their profits, but I get it, you hate VCs.
That's disappointing. I knew it was a joke, of course. But I took it as an acknowledgement that he, like all of us, has irrational biases that we discover over time. I'm sorry to see that it was much less than that.
Things like "team" and "gut check" are especially useful answers for that, because a) it lets VCs sound like intuitive geniuses who can't easily be replaced, and b) the I-know-it-when-I-see-it nature of those lets VCs smuggle in all sorts of irrational biases. As one well-known investor said, "There was a guy once who we funded who was terrible. I said: 'How could he be bad? He looks like Zuckerberg!'" Points for honesty, but you can bet that wasn't the official reason they invested.