As a beginner at funding but a veteran at managing businesses I am conflicted on this topic. Founders believe in themselves and their idea so much so that most who listen to their pitches think they are blinded by their own enthusiasm. While their are some investors, some in my own friend group, who think they are smarter and have better prepared to make “good picks” than others.
That may be true to an extent about founders but I would argue that no one can consistently pick winners in any business, science, industry, or race. Some may have found ways to scoop up the right ones at the right time often enough to claim they are startup geniuses but how many of those are willing to publicly claim their losers?
Tod Francis at Shasta Ventures recently put together a nice observation of this. Please give it a read. In a nutshell he says “There is no formula, expectations are often wrong, and each success story is unique and unprecedented… but that doesn’t mean there are not patterns worth paying attention to.”
I think aiming for unicorns might make you broke fast and really piss off your LPs but let’s keep listening to what he has to say. I will aim for more attainable goals for my first fund. Who knows? Maybe we’ll see a rainbow or two.