My Partners

It's friday so it's time for another suggested post from the amazing comment thread on the bloggers block post. Mark Suster suggested:

how about a post on your partners: who they are, how you guys work together & a bit more about how you guys reach decisions on deals?

I have two and half partners at Union Square Ventures.

Brad Burnham – Brad and I founded USV together in the summer/fall of 2003. We had both been in the venture business for more than a decade, had made a fair bit of money, but were still hungry to prove ourselves. Brad is the strategist and the most principled investor in our firm. It was Brad's idea to write a treatise on venture capital and the internet before we set off to raise our first fund and that exercise we did together continues to be our guding light. Brad is the person behind phrases like "the application layer of the technology stack" and "large networks of engaged users" that I use all the time. He gives me most of my good stuff which I often get credit for.

Albert Wenger – Albert was the President of Delicious until it was sold to Yahoo!. After that sale, he joined USV as a venture partner and as a general partner when we raised our second fund in 2008. I can't image operating USV wihtout Albert but we did for our first several years. Albert is hacker who still codes stuff up in his spare time. He's been a CTO, a VP Engineering, and has run businesses. And he is a great investor too. And he's the most underrated blogger in our firm. Albert has a very analytical mind, asks piercing questions, and thinks deeply about the web, its underlying technologies, and new business models.

John Buttrick – I can't link to John because he's managed to avoid any social media presence in his first fifty years on planet earth. We will get him on our website, but I'm not confident we will get him to do much more than that. John joined us officially in December when we raised our Opportunity Fund. You can read a bit about him in my post on the Opportunity Fund. John's been hanging around USV since formation advising us on legal, financial, and operational stuff. He's helping us evaluate the more established businesses we look at, but more than that he's helping us rethink the way we raise funds, structure funds, communicate with our investors, and run our firm. It's great having him around.

We run our busines in the model of the "sleepy little firm" that I spent my first ten years in the venture capital business with. We all work out of a single office. We have a total of six and half (John is half time) people at USV. It is quiet in the office on many days when we are out and about visiting companies. We value trust, respect, and consensus. We don't invest in companies that everyone is not 100% behind. We never vote. We don't exercise vetos. We don't yell. We don't blame each other for our failures, we blame our team, our process, and our collective decision making.

Many people think I am the "lead partner" at USV. That could not be further from the truth. Brad should get most of the credit for setting a strategy that we have executed very well. Albert should get the credit for steering us into new areas we would not have been in without him. I get to be the front man but that's really the easisest job in the partnership.

We are a true partnership where each person contributes deeply to our collective success. Trust and respect are the key operating words. And once a partner has worked one fund with us together, we are equal partners and share in the profits equally. We don't want to have too many partners and I don't think we will add many more. Maybe one more, maybe not. We will see. We are doing fine with the ones we have right now.

I love working in this partnership. It is easy, it works, and it has proven itself.

#VC & Technology

Comments (Archived):

  1. Pascal-Emmanuel Gobry

    I second the part about Albert as an underrated blogger. I follow him on Tumblr and he’s full of great insights.

    1. Donna Brewington White


  2. Fernando Gutierrez

    John must be amazing if he’s managed to seduce the guys who always ask for an online presence without having one!

    1. Donna Brewington White

      Was thinking this, too. But maybe they only insist on this for the people closer to the front line.

    2. Dave Pinsen

      They’ve known him for years in real life. That obviates the need to wade through blog archives to get to know him.

      1. fredwilson

        dave’s got it right. we use that tool to get to know people quickly

    3. Senith @ Finance Ttutor

      Was thinking the same! Probably adding value outside the domain expertise.

  3. Steve Poland

    Thanks for a glimpse behind the curtain. This is a great exercise for teams.

  4. Donna Brewington White

    “Maybe one more, maybe not.”If you did add another partner, what would be the probable reason?How do handle disagreements?Thanks for this peek into USV. What a great group! Seems almost idyllic — but I don’t think idyllic happens by accident or without hard work or careful intention — or something — especially in a pressurized business like yours. I’m wondering if it’s by nature of a certain amount of homogenity or is this something you have to work at? And are you really as homogeneous as you appear to be?(I feel a bit like an investigative reporter — but one who plays nice.)

    1. fredwilson

      We seek to minimize disagreements with our culture. We don’t fight about newinvestments. If someone is not comfortable after a healthy debate, we moveon. There is always another good deal around the cornerWe support each other on existing investments. We tend to be supportive to afault once we’ve made an investmentNot much else to fight aboutWe tend to order lunch from whichcraft

      1. Adam Alphin

        Sorry, comment post fail there…Can you comment on how ‘friendship’ plays into your partnerships? Were you friends before USV with any of your partners, do you hang out outside of work? Do you recommend people that are already close friends who have a lot of mutual trust and respect ‘risking’ that friendship by forming business partnerships?

        1. fredwilson

          we are certainly friendsbut not “best friends”

      2. matthughes

        Wichcraft is excellent, @tom_colicchio nailed it –

  5. Raj

    Fred = vocalsBrad = drumsAlbert = guitar and keysJohn = tamborine

    1. andyswan

      There has to be a Pete Best. Has to!

      1. greenskeptic

        Perhaps Andrew Parker was Pete Best?

    2. fredwilson

      i think John’s on bassand i can’t sing, not even karaoke

      1. melissatran

        We can ALL sing, Fred… we just wouldn’t all make it to the next round ;o)

      2. Evan

        since when is vocals in a rock band about singing?

    3. Donna Brewington White

      you’ve gotta have bass or there’s no rhythm section…

    4. kidmercury

      Disagree. Fred is definitely vocals, but i think brad is guitarist and principal songwriter. Albert holds down the rhythm section on bass and drums (probably programmed drum loops). Buttrick is band manager. Don’t think he can get an instrument till he gets some social media presence.Just my take of course. Eager to hear other opinions.

      1. fredwilson

        love this comment Kid

      2. Fernando Gutierrez

        That makes sense! I’m terrible with music, so I’ll turn to crime. No offense please, the other day I watched The Pink Panther again and was thinking about robberies :-)Brad is in a van outside the museum coordinating the strike through the radio. Fred distracts the guards while Albert disables the alarm and takes the painting. Next day John negotiates with the fence and they all go out to celebrate.

        1. kidmercury

          hahaha i like the robbery analogy!

    5. Raj

      When USV syndicates with Spark they form a super group.But are they Journey, Bad Company, or the New Pornographers?

      1. fredwilson

        traveling willburys

        1. Raj

          That’s hilarious.

        2. Jack Dempsey

          Amazed to see this reference here. For the talent they brought together, no one I know has ever heard of them. Gonna go take a listen to tweeter and the monkey man…

  6. Harry DeMott

    Do each of you track separate companies? or is everyone involved in the day to day on the whole portfolio?When you meet a company through one of the 3.5 partners, how do you actually track those potential investments until you decide one way or another?

    1. fredwilson

      each portfolio company has a partner with primary responsibility, but we tag team a lot. albert and i work on etsy, i lead he supports. albert leads on foursquare but i’ve gotten engaged in a few things there. albert has helped on twitter, particularly back in the fail whale days. brad and i did TACODA together and i help him on getglue and hashable. brad helps me on disqus and targetspot. so ultimately it is very much a team effort. i know every ceo and founder in our portfolio and have a working relationship with all of them. when you get USV on your team, you get all of us.

      1. William Mougayar

        At which point when you find something interesting, do you start getting the other partners involved in the decision-making.

        1. fredwilson

          Right away. I sometimes pull them into first meetings half way through

      2. RichardF

        “when you get USV on your team, you get all of us”I wonder how many other VC firms can make that claim? not many I doubt.

    2. fredwilson

      We work new deals as a group but a couple people drive. Then one of us takesthe lead post investment. The entrepreneur usually chooses who

  7. Mwiya

    VC’s manage to run a firm as a partnership as do many other types of firms. Why do you think this type of organizational structure isn’t very typical in large corporations, particularly technology companies. Is it a must for you that there must be a recognized CEO in your portfolio companies? Or is it fine if they opt for the flatter partner based hierarchy more typical of accounting firms, law firms and v/c’s among others?It seems the system you have is great because its based on trust, I think a big worry a lot of start-up founders have at the back of their minds is “I hope my co-founder doesn’t screw me over in the future.” Do you think a partner based structure could stop this? I know this is something that Twitter had to deal with for example.

    1. fredwilson

      partnerships are hard to scalei’ve seen partnerships with ten or more partners and it is not at all like ours

      1. JLM

        There are “partnership” arrangements which are just legal structures with hierarchical depth and then there are partnerships which are truly collaborative efforts between and among a very, very, very small number of equal partners and which are completely flat.And very very rare. Very difficult to maintain. Impossible to scale. Totally impossible to scale.

        1. fredwilson

          That’s why we will not scale. When we raised our first fund we toldinvestors that. They didn’t like it. They want investments they can scaleinto

          1. Kevin

            Isn’t that one of the the major problems? … that people outside of a group tend to set expectations that not only don’t make sense, but that would actually hurt the group if done? You see this on teams, in companies, families, etc.It is easy to say that you need to set your own expectations and ignore much of the noise — as I guess I just did — but the trouble is when you need outside help, in your case investors, to execute, yet you really don’t want to do what they want to be done.

          2. Fernando Gutierrez

            You’ve just raised a new fund with most LP repeating… I guess that, even if they want investments that can scale, they want even more investments that work!

  8. William Mougayar

    You have a very harmonious team, and you guys are definitely punching above your weight in the marketplace.From my experience, it’s pretty quiet in your office, even with all in.

  9. andyswan

    This is the most important sentence in this post: “It was Brad’s idea to write a treatise on venture capital and the internet before we set off to raise our first fund and that exercise we did together continues to be our guding light”The rest of it builds on that. With an agreed upon common purpose, passion, and direction, all else happens on its own. We don’t need an agreement that YOU agree with ME, we need an agreement that this fits OUR already-agreed-upon purpose!Very timely post as we write the “constitution” of our next win. Very timely

    1. fredwilson

      we our fellow entrepreneurs in order to form a more perfect startup ……

      1. Austin Clements

        Great post! Thanks for giving us a peak into USV.How would you say the USV ‘constitution’ differs from a typical mission/vision statement of, say, a Fortune 500 or any other company?

        1. fredwilson

          we are not trying to build something lasting

    2. Evan

      Obama AND Charlie Sheen are stealing your catchphrase.

      1. andyswan

        Win cannot be stolen. It just is. The more, the merrier. Join the win.

  10. msuster

    Great to get a sense more for the team & dynamics. Being the “front man” as you call it can be strange. My partners have bet on 16 companies with $1 billion exits and are all people I hugely respect. Yet because I’m our “front man” many people see me as GRP. As with Union Square, these businesses are always best as team efforts where we all benefit from our collective & different skills.

    1. fredwilson

      so true. thanks for pushing me to writ this mark. you are up early. it takes an early riser to know an early riser

      1. msuster

        It’s when I have time to read, think & engage. That and post 10pm. During the day, as you know, the VC business can be awfully busy with pitches, board meetings, deal reviews & other meetings. Plus, have to be up early to beat the morning family time.

        1. fredwilson

          I have the same routine for the same reasons

        2. Mark Essel

          I share the routine, but pass out by 9:30-10 most nights. Can’t beat quiet reading time between 4:30-5:15 during the week, and weekends I get “bonus” time while Michelle sleeps in.Great question. I appreciate the role you and Fred share as public faces for your firms.

  11. DGentry

    John Buttrick is another example of the “Warren Buffet problem” of measuring influence. Minimal online presence != minimal online influence.

    1. fredwilson

      John is a bit oracle like

  12. kirklove

    Nice post. Team FTW.

  13. davidblerner

    People in partnerships, marriages, boards, mgmt teams… you name it- should frame this and live it:”We value trust, respect, and consensus….. We never vote. We don’t exercise vetos. We don’t yell…”fantastic, thank u.

    1. fredwilson

      Its taken me 25 years to learn it and live it.

  14. Dave W Baldwin

    Thanks for the very informative post.

  15. melissatran

    Has anyone read “The Speed of Trust”? It’s about how “Trust” is good business in a very practical, efficient, productive sense and practices that build and break it. I got a lot out of it and see a lot of common threads between here and there.

    1. Nate Quigley

      I have. Agree that it’s main thesis is absolutely spot on. Trust is the oil in the engine.Felt like it was one of those “I get it after page 2” type books and I faded after a few chapters. I did like the way he broke down the components of trust and what it requires of both sides. Sounds like USV has figured it out. Agree with comment below – Team FTW.

      1. melissatran

        Same experience w/getting the point after the 1st few pages. But I kept going and found value there because he did a good job demonstrating how people and companies get lost or completely miss (or dismiss) the role interpersonal dynamics play in getting things done. It helped me learn to frame trust as “Smart” and “Good Business” for those who tend to minimize it’s importance (and the importance of developing it in teams) as just another “soft skill”.

        1. Nate Quigley

          Sounds like I need to pull it up on Kindle again and scan some more. I thought it was an important idea. Just reminded me of the Gladwell book Blink – which was for me the ultimate ironic title.

  16. baba12

    My dad always used to say the following.If you are right you don’t need to raise your voice, if you are wrong you don’t have a right to raise your voice.Diplomacy is when you tell a person to go to hell and they look forward to the visit.So when you have a team that trusts, respects and is consensus bound then it moves as one unit always but like an oil tanker with many compartments to keep it balanced the partners at USV seem to work a smooth operation.Mr.Wilson have you ever had a situation wherein when you are making an investment for USV, you have had an entrepreneur want a deal wherein they ask to be a partner at USV once their company has achieved the success as defined by USV and the entrepreneur together.

    1. fredwilson

      Not yet.

      1. baba12

        But if say the founders of Twitter had asked that as part of their deal with you, would you have walked away from the deal or made a deal that worked.In Hollywood before actors were paid for a movie or a sitcom and that was it, but in the last two decades actors have wanted a smaller pay and a greater stake in the distribution rights etc. So I wondered in the VC investment world if there is a lot of money chasing few ideas then is it possible to entertain such kinds of deals and how it would affect the VC industry. Just a thought given you are in a comfortable space and not necessarily looking to expand in terms of partners.

        1. fredwilson

          that’s not our model. we share in the enterprise value as it grows. we don’t pay anyone upfront and never will

  17. LIAD

    time to put the cat amongst the pigeons…’re in a burning building and can only save one…

    1. Dale Allyn

      Save all or die trying. That’s what a team does. 🙂 If that’s not the feeling, trim the team before the fire ever starts.

      1. LIAD

        Superb comment. Absolutely superb.

  18. leeschneider

    Fred,Where do you rank “partnership” on the list of things that have made USV successful in the past and looking ahead to the future? The way you’ve written this post (and it’s a damn good one – esp. the comments) it seems 1st and foremost, above deal flow and access, investors, fundraising, finding excellent entrepreneurs, etc.-Lee

    1. fredwilson

      number one on the list

  19. greenskeptic

    “We are a true partnership where each person contributes deeply to our collective success.”Awesome.The world is full of collaborations, but so few true partnerships.Kudos to you guys for leading by example.

  20. reece

    you know I love a great team…unsung heroes here: Christina, Gary and Dorsey – all excellent people!important aspect for me – when I meet partners/associates who aren’t great people, I immediately question the entire firm..

    1. fredwilson

      yup. mark asked about my partners. i should post a follow-up about or team

  21. David Shellabarger

    Do entrepreneurs mainly come to USV or do you have to seek them out?If you seek them out, which partner does most of the entrepreneur searching or is it about equal?

    1. fredwilson

      we seek them out. this conversation right here is a part of that. when are you going to come talk to us about your android app?

  22. Nik Cubrilovic

    Fred I have the opposite to your bloggers block problem – I start too many posts without finishing them. i have a publish button anxiety for some reason:…thats 50+ draft posts, plus another two dozen in google docs, on my dashboard, etc.

  23. ShanaC

    Well, what did you do behaviorally to be able to build the “trust and consensus”And how is John faring as the new part guy time (I hope he is doing ok with it)

    1. fredwilson

      it started with me and brad. we developed it as we started the firm

  24. J.R. Sedivy

    Your partnership sounds like it embodies the value offered by a great team – The whole is greater than the sum of the individual parts.

  25. Douglas Crets

    This “sleepy little firm” also has a really great espresso machine in the office kitchen.Where is this treatise, Fred? Would you ever do a short five question interview about updating this treatise? I wonder, especially, what are your views on hacking education like in 2011.

  26. Tom Labus

    When will it be time to revisit the 03 treatise in a formal way not on the fly?

    1. fredwilson

      we spent two hours yesterday revisiting itwe do that regularlywe evolve it

  27. paramendra

    One of your best posts ever? …. Why does Brad not blog? He is the most mysterious of the three to me. I mean, I don’t know the guy. Never met. Etc.

  28. aripap

    I believe Brad is also the author of the phrase “data exhaust,” defined as the valuable stuff that comes for free from people doing things they are interested in within a social environment. Example: People’s personal bookmarks shared to make Delicious more valuable.Please correct me if that’s actually yours Fred.

    1. fredwilson

      all that kind of stuff comes from brad

  29. Fred Destin

    As ever, an inspiration to us all. Long live the artisans. And the microbeweries. And handmade furniture.

    1. fredwilson

      i saw your tweet fredloved the #artisanvc tag.that is a compliment of the highest order to me

    2. Dave W Baldwin

      Reading through your blog is interesting.

  30. David Smuts

    Fred, why would you not want to expand? Surely that’s the most basic capitalist principle behind every venture? Make somthing work, then make it bigger. Is this more a life-style choice? In any case, you have to admit, it’s not the norm 😉

    1. Fred Destin

      David 3 ideas to ponder:- USV = an organism, not an organisation- Coase’s Theory of the Firm- There is little leverage, mostly diseconomies of scale

      1. David Smuts

        Fred what Coolaid have you been drinking dear boy! You’re starting to sound like a Social Entrepreneur rather than as a VC (then again, I have always accused you of being an Entrepreneur at heart who just happens to be in the business of growing other companies ;)3 Points Comments:1) If USV were an organism it would not be operating for profit nor would it have “rules and structures”. It is profit orientated (and nothing wrong with that btw) as well as very structural and process driven in the approach to investments.2) Buddy, you are far to intellectual on a Saturday morning for me! I had to check out what Coase’s Theoram on the “Nature of the Firm” was… So at least I learned something new here THANK YOU! Very interesting theory and I see the link you’re making here (would love to here the Wilsonian view on the Coarse Theoram +++)3) I disagree here, if USV were to propagate their model (they have a very well defined process model to investing in early Tech). They could easily branch out especially internationally (London, Berlin). If they were less process driven and less methodical that may be a challenge, but they have a formula which works very well for them and has been structured and refined over a period of years. SO I do think the leverage opportunity is there.In summary, I think USV (as a corporate organisation) could easily leverage their asset (market knowledge +people +process) to expand their business. Any other reason not to, in my humble view has more to do with social lifestyle, philosophy, outlook etc.., (which btw I am not disagreeing with!) rather than bona fide commercial reasons.

        1. fredwilson

          well we are not going tosome things are left well enough alone

          1. Fred Destin

            The Fred’s are guilty of groupthink.

    2. fredwilson

      vc does not scale

      1. David Smuts

        That’s a very interesting comment Fred! (still digesting it)So what would you say then, is your maximum bandwidth, capacity, scale potential (whatever you want to call it)? At which point do you feel USV becomes fully saturated? (max number of investments met by max resources).Surely there must be some desire to expand or at least increase your portfolio pool. After all, why not help create 50 game-changing companies rather than 10 for example?

        1. fredwilson

          we can’t and we won’twe can do 6-8 deals per yearthat is what we have been doing since we started USV in 2004

      2. David Smuts

        Fred, still curious here…,Why would a successful VC model not be scaleable?Interested to hear your views (perhaps a blog post on its own?)

        1. fredwilson

          one VC can manage about 8-10 investments at a timea partnership starts to suck at about five or six partnersthat’s the math

          1. David Smuts

            Another interesting comment Fred and one which I agree with. I hope you don’t mind me tweeting this as the point you make is quite bold and controversial (not for me) due to the sheer number of 6+ partner VC companies out there!

          2. fredwilson

            feel free to spread the word

          3. Fred Destin

            we’re 3 tech + 3 LS, i took us years to get back down to this configuration and it feels so much better

  31. Arkadiy Amelin

    Dear Fred,I consider your blogging to be very useful and instructive in the form of lectures to start-up entrepreneurs’ audience and you are likely to know the major players in the venture business.On Wednesday, March 2, 2011 in Moscow I participated in a meeting of the U.S. – Russia Innovation Council on High Technologies (… which had been created in 2003 to act as an advisory body and implement programs to stimulate innovative, entrepreneurial science and technology based business, institutional and academic partnerships. During the discussion initiated by one the U.S. Dept. of State officers I suggested the most prominent figures of Angels and VCs industry such as Fred Wilson, Steve Blank etc. to get involved in the affair.If you are interested, let me know and I’ll be glad to provide you with all the details of the discussion.

  32. Aruni S. Gunasegaram

    I really enjoyed this post! It’s nice to get a better view of the people standing beside the man who seems like one of the most successful people in the US on all levels: professional, personal, physical, mental, etc.I can’t to read a post where you let us know you have added a woman and/or an ethnic minority partner on your team.

  33. Adrian Meli

    Fred, great post. You are lucky to work with such great partners and they are lucky to work with someone who speaks so highly of them. It is truly difficult to find equal partnerships of mutual respect in the investment business and it would seem you have that in spades. Congrats for building such a great firm and team. Sounds like an unbelievable place. – Adrian Meli

  34. Ken Lawler

    I completely agree you want your partners to be with you 100% and to work for each other. You each have your own specialties. It is important to focus on those. I run a mentor capitalist firm in St. Louis