Should VCs Blog?
I ask this question because the Boston Globe asked it in a piece in yesterday’s paper. The answer depends first and foremost if you are comfortable blogging and are willing to make the commitment to do it often and do it well. If you are uncomfortable with blogging or are unwilling to commit to it, then the answer is no, you should not blog.
My views on the the subject are pretty well outlined in the piece. The journalist who wrote it, Scott Kirsner, had an email conversation with me. I told Scott the following:
[Blogging is] a huge benefit to our business. Of course it brings
incremental deal flow, but it also filters the deal flow and makes it
more targeted and more relevantIts also a great way to bring needed attention to the companies we invest in
And its a way to do research on new sectors and learn about other companies that compete with our companies
And
its a great way to learn about emerging technologies. Check out the
comments to my andreessen post yesterday or my post on AIR last week.
You can’t buy that kind of education and I get it every day for freeI could go on and on. Its the best tool for vc investing that I’ve ever seen and I’ve been in this business for more than 20 yrs
My favorite quotes in the Globe article come from my friends Woody Bensen and Charley Lax. Woody says:
Woody Benson of Prism VentureWorks says the Needham firm has spent
years gaining venture capital experience, "something that we call our
intellectual property.""Our goal is to share that in the
confines of the meetings that we have with our portfolio companies and
potential portfolio companies," he says.
That, to me, is the defining argument for and against blogging. There are those who think the best way to manage your "intellectual property" is to hoard it for yourself. There are others who think that intellectual property should be shared, developed out in the open, and that it will grow exponentially. I am in the latter camp. In fact, that is my worldview on almost everything, as readers of this blog well know.
Charley Lax’ quote is classic Charley:
Charley Lax, managing general partner of Grand Banks Capital in Newton
Centre, says the limited partners who put their money into venture
capital funds think blogging is "stupid. They want you to be working on
your portfolio companies and looking for the next great deal."
You can spend you time in the venture business worrying about what your limited partners think or you can focus on your true clients, the entrepreneurs and the companies they create. I prefer to do the latter and I think blogging helps enormously in that effort.
I don’t think there’s a right and a wrong in the "should VCs blog" debate. It works for me and it works for our firm. And I couldn’t imagine doing this business anymore without a blog.
Comments (Archived):
Corporate blogging is difficult when the company becomes larger. If you had 20 partners, there would be more possibilities to say the wrong thing. Also, would you let a junior associate add articles to your blog? I think that for a firm your size, you have gotten it just right. Also the critisim about blogging sounds a lot like the old excuses NOT to use email whe it first came out.
Fred, i posted a few months ago a list of the 10 reasons why VCs should bloghttp://ouriel.typepad.com/m…I totally support your point of view.Ouriel – TechCrunch
At the end of the last century I read a lot of books about vc and I talked to a lot of vcs and I read magazine articles about vc. But I never had the faintest idea of how vcs thought or what they did or how they did it. I never knew what they were doing or what people thought of them. Now I do. It’s a free education, but more than that, it’s a valuable education and a priceless insight into an important part of my life.VCs should blog, blog and blog again.
Transparency in the market is always a good thing. The only reason VC’s shouldn’t blog – and this holds true for all organisations – is the potential damage it could do to a firms reputation. I think the apparent ‘risk’ is so overstated that it’s laughable, but unfortunately the communication departments in big companies seem to think otherwise.All blogging is, is a conversation with people on a grander scale. Why should we lock down VC’s to the hallways of conferences?
“Should VCs blog ?” makes no sense at all…How about “Should VCs use hammers ?”Whatever the tool you have at hand to maximise your chances of success, you should use it.That’s why we have the press, and radio and TV and now this originally unintended use for the Internet.To reach out. Bidirectionally so.In times where the cost of having your own little newspaper with a global readership is next to nil, you have to really think hard to come up with reasons why not to blog.It probably makes more sense for a smaller kind of independent firm, than say… for a big bank, as others have pointed out, but still… smart companies should always find ways to maximise their outreach and engagement with their target public. Doing otherwise is plain negligence.
VC’s should blog. It is nice to learn about leading Venture Firms, their partners and their focus. However, often it is perplexing on why the Mets losing streak, their steak dinner last night or their vacation to Vermont have any place on their blogs. I am not interested in knowing that a grown man is a spider man fanatic. Many firms have almost every partner thinking they are to spend a significant amount of time as a writer rather than a visionary leader seeking to find the next homerun. Use the blog for enagement and interaction and growth. Use the web to find investments of differentiation.These days it may be more refreshing to find VC’s that are looking, listening and engaging early stage companies touching on emerging markets, under served demographics or new products and services. It is too easy to write about the likes of Facebook, Myspace, Twitter and next emerging tech company. Look at other blogs, websites and communities and perhaps save your blogging for the time that your interest has peaked an investment or potential funding in companies other than the monsters.Respect to you all. Keep your fingers typing, but please don’t miss opportunities with strong management teams communicating their products to markets with substantial buying power. We are all working to too hard to be ignored.Rockers It’s Dangerous Crewwww.RockersItsDangerous.comA Lifestyle Brand for the Caribbean Community.
It’s just a tool. Posts about running startups, valuation, etc, are most interesting (*Scott Maxwell’s blog is really good for that).But your true customer isn’t the entrepreneur. I’m surprised you say that. If by saying that and believing it leads you to good returns for your actual customers (limited partners), then great. But no ROI, no money to invest, si?http://www.charliecrystle.com
charlie – there are lots of places to get money. it’s a commodity. great entrepreneurs are the scarce resource in the VC business.
You’re right.–charlie
Amen.
Although we’ve never met, the thoughtfulness of your posts and the discourse you promote would make you high on my list if I seek venture backing for something in your space – so there’s definitely incremental, and filtered, deal flow. Of course, I read some VC blogs that just sound like arrogant rants, and they’d be low on my list. VCs who get along well with entrepreneurs should blog.I’m sure your blog has also helped fertilize some germinating ideas, or nudge companies in directions that make them more interesting. Whether you fund them or not, that’s a bonus for the entire market.
BTW… where’d Beisel go ?he hasn’t posted anything in the last 40 days or so
We got funded because VC’s blog (here at A VC and many other places). Entrepreneurs learn about the process and the players on VC blogs.
Can you tell me about “many other places” ? Thanks.
http://networks.feedburner….
thanks.
I agree that VC blogging is quite beneficial because the more you blog the more people you know and the more people know you, which will lead to more deals. Also you’re helping people learn more about the business and industry which is a great blessing for a lot of readers. I, for example, am a business grad who just moved here from Canada and I’m just starting to get in this technology field. Your blog is useful for me to learn and familiarize myself with the industry.In fact, like you in a way I started my own blog, a few days ago though. Since I’m doing all this research for myself, why not go the extra mile and synthesize it for others (maybe in the same position) while I get a better understanding of it as I write it down, I thought. So I’m just going to blog and hope other students wanting to get into tech and VC industry will find it useful and blog my adventures of life after graduation. However, I’m a little worried about how it’ll work out or how useful people will find it. And I’m wondering if I should use my real name. What do you think?
Though some can get by without it, blogging is definitely a great tool for venture capitalists.In an era where entrepreneurs are increasingly consumers, blogs can help entrepreneurs differentiate between firms, and partners within firms.This benefits both the entrepreneur and the venture capitalist.It reminds me of that old slogan for Syms department store, “An educated consumer is our best customer.”The more the entrepreneur and venture capitalist know about each other, the better.Then there is the value of the process.Like asking an entrepreneur to draft a business plan, the exercise of blogging is helpful, in and of itself, because it forces the venture capitalist to organize his or her thoughts.This applies even if, as is the case with me, nobody reads your blog! ;)Another benefit of blogging, which Fred already described, is the ability to tap the network and collective knowledge of your readers.Finally, to the extent that it demystifies the venture capital process, I think that blogging by venture capitalists is beneficial because it helps reduce the ‘lost in translation’ divide between venture capitalists and academics, which will hopefully facilitate the formation of new companies.
aren’t entrepreneurs the ones supposed to facilitate the translation between academia and business ?sometimes academia and entrepreneur are represented by one and the same person (google notoriously so) but oftentimes not.a few names you will find interestingly entreprenurial and non-academic:bill gates, larry ellison, steve jobs
I think more venture capital types should blog, because it helps disseminate more information about the company evaluation and decision-making process, which is not obvious to many entrepreneurs.
Whether or not VC’s “should” blog, I guarantee that your and other VC blogs are great resources for entrepreneurs.(Also, since I didn’t see a trackback option I hope a manual “trackback” to my post is ok.)
Having been involved in VC in China, I have spoken severally (in Mandarin) with VC/PE and other fund managers (the locals, not the English-speaking returnees) and not a one blogs and found it very strange that any fund manager would do so.
How many of these reasons to blog for you as a VC are also reasons for the folks running your portfolio companies to blog?My sense is some, but not many. I think entrepreneurs blog for a different set of reasons than VCs, and thus tend to produce a different style of blog. I’d call the difference altitude — VCs are at 30,000 ft, focusing on trends; startup folks are in the weeds, trying to define their vision for their product.
I too also share the latter view. I’m a big believer in applying the principles of open source to business.It’s the foundation for why I started The China Business Network site and related show because you would think that in the almost 2 decades since China opened up for international business, the rest of the world would have a better understanding of it. Those who know the “secrets” and paid their dues are rightfully entitled to profit from it via consulting companies, books and so forth. But I strongly feel sharing their intellectual property only serves to confirm their expertise and increase their credibility. Do a google search on China consulting and you get a flood of results…which ones are the real experts and which ones have no clue but pretend they do? Who’s got the real grasp on how things work and who’s just making it up as they go along knowing that the newbie to China wouldn’t know the difference?Blogging. Sharing of info. Offering insight out in the open helps to weed out those who pretend they know and those who really know.I know this ramble isn’t VC related Paul (sorry!) but I do believe it applies to those doing business in China in general.Thanks for sharing as always. Keep it up. I’m reading!
Maybe your LPs don’t think it’s stupid. Perhaps they even use it as a tool to monitor their portfolio? Turns out we can all benefit from an open conversation.