Fighting decision-making biases in VC & entrepreneurship.
Joined February 2018
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704 Photos and videos
Jun 8
It used to be more common in the past.
Jun 8
I was backed by Mike Moritz of Sequoia. Before he did the Series A we discussed this topic because Sequoia had a reputation of replacing founders. I agreed to step aside at some point. Before long that point arrived and we hired a CEO. Then that hire didn't work out and I resumed the position. And later we replaced me again, with greater success. At all times Mike, Sequoia, and I were on the same page. As long as there is transparency and honesty, founders should be comfortable with that situation.
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Aram Attar retweeted
Jun 7
I’m backed by Vinod. Every founder who raises from Vinod knows the deal.
Could he try to fire you from your own company if he thinks that’s what the company needs?
Yes. That’s not a secret. We even joke about it.
But making this entire drama about “firing founders” misses the point.
The point is that Vinod will always make the call he believes is right for the company, no matter how uncomfortable it is.
And there are 2 sides to that coin.
If he thinks you’re in the way, he’ll move you.
If he believes the company should win and you’re the person to make it win, he’ll move mountains for it. He’ll pull strings, take the hard fights, and push harder than almost any investor would.
The ruthlessness that makes him dangerous is the ruthlessness that makes him exceptional.
That’s the deal with him. Vinod is not founder-first, he’s company-first. And if that makes your uncomfortable, you should probably pitch someone else.
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Aram Attar retweeted
Jun 5
Two of our worst VC stories:
1. A Sequoia partner passed on Cloudflare because he didn’t think a woman could lead a security infrastructure company. Seriously. 🙄
2. I got introduced to @pmarca. Meeting got scheduled for a Monday, which should have been a clue. I thought it was just a casual meeting. He thought it was a pitch and brought the whole @a16z partnership team. Hilarity ensued. 🤪 At one point one of them said: “You don’t seem very prepared.” Which was true because I wasn’t. I framed the rejection letter they sent.
Jun 2
I was once pitching in a board room at a top 3 VC firm for a $15M Series A.
12 people in the meeting. One of the GPs fully fell asleep. Out cold for 30 minutes. Nobody acknowledged it. Everyone just kept going.
I kept presenting my Series A slides to an unconscious man in a Herman Miller chair and somehow that was considered normal. That's venture capital.
You might fly across the country to perform for people who may or may not be conscious.
It's a dance.
And sometimes you lead and sometimes you follow and sometimes your partner is unconscious.
If you're raising right now, just know: every founder has a story like this. The process is weird. The power dynamic is weird. You're not crazy for thinking it's weird.
No one talks about it because they want to continue raising. But I'm happy to stick my neck out there.
It is weird.
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Aram Attar retweeted
May 29
Occasional setbacks are a part of trying ambitious stuff. Kudos to @JeffBezos for trying. I’m sure he will succeed next time. Try and fail but don’t fail to try
May 29
Breaking News: A rocket built by Blue Origin, the Jeff Bezos-owned space company, blew up on the launchpad during a test in Florida. The failure is a setback for several missions. nyti.ms/4ffp4QT
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May 28
Saw a pitch yesterday where the Founder mentioned they had “2 pilots” going on.
How much is that?
3?
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May 27
✅ Douchebag test: that guy speaking loudly in the WeWork open space when there are private booths available five feet away.
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May 27
AI is coming and no sector will be spared.
Just attended @Stanford Breakthrough demo day. 23 Founders from top universities select out of 750 applicants.
Even braiding hair will be AI-driven.
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May 17
Spartans who went to war used to braid their hair, exercise less rigorously, and generally endured less hardship than usual.
War represented a more relaxed period for them compared to their usual lives.
Reminds me of this guy:
youtube.com/shorts/Nvo5nhKvz…
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May 12
Love that poker story!
thevcfactory.com/martin-tobi…
To become a better CEO, you don't need an MBA.
You need to play poker.
It'll teach you the art of decision-making under uncertainty.
You'll learn to detach from outcomes, think in probabilities, and manage risk.
You'll become a better investor.
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May 9
“Bad people make bad founders.”
May 7
Sure you can earn a billion dollars. I've been teaching people how to do it for 20 years. The way you do it is to start a company that grows fast. You don't have to do anything bad to make a company grow fast. You just have to make something people want.
paulgraham.com/ace.html
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May 9
Entrepreneurs rarely chase money in isolation. They seek to solve problems, prove themselves, improve their lives, or (sometimes) help others. They want validation, freedom, and a sense of purpose. Money often marks progress toward these deeper aims.
thevcfactory.com/is-money-th…
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May 8
Same for VCs investing at pre-seed and seed
at pre-seed I want to hear much more about opportunity maximization than risk mitigation.
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May 6
VCs who want “coachable Founders” often overestimate the value of their advice.
Most entrepreneurs succeed despite bad advice they receive from others because they know how & when to filter.
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Aram Attar retweeted
May 5
How LPs view GP activity on social media:
- 98% say social media profiles of firm personnel are important when deciding to invest.
- 85% of LPs want to see personal statements about geopolitical or societal issues.
- 85% have decided not to allocate to a GP because of their social media content.
These survey responses raise questions about LP competence and fiduciary duty.
Allocation decisions should not be influenced by politics. Not just because it's a dumb idea, but also because it's known to be a drag on performance.
The case might be made that it's about "values alignment", but that should be understood through the GP's work, where those values are relevant.
It's unfortunately common for allocators (on both sides) to resort to comforting personal biases when making low-confidence qualitative judgements.
For example, research shows that VCs are also more likely to invest in founders with shared political views, and the result is higher failure rates and fewer exits.
It's one thing to use personal social media to DD key facts or check for malpractice, but using that content to guide investments is garbage in, garbage out.
tl;dr - The world would be a better place if allocators would just read a bit of Kahneman.
(In VCs defence, at least they are smart enough to not broadcast that bias.)
May 5
Still remember VCs telling me that posting authentically on X back in 2021 was nearly shameful and that "LPs would hate it"
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Apr 28
GPs pitching LPs on their DPI after 2 years should know there’s no correlation between DPI in year 5 and final performance. Outlier funds get to 1x DPI in year 8.
LPs who want DPI in less than 10 years should not invest in VC. It takes time to build great companies.
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Aram Attar retweeted
Apr 27
Every startup should run cash like a Formula One car. Full speed on the straight. Brake as late and hard as possible into the curve.
The danger does not come from a high burn rate - but from not being able to change it rapidly when things change.
A recent conversation with our portfolio founder on risk and burn management, and the metrics that actually matter:
khoslaventures.com/posts/ven…
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Apr 13
Controversial take: LPs who ask about liquidity horizons should not invest in VC. It takes time to build great companies from scratch.
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Apr 13
Quite strange how many GPs tell you they take their time getting to know Founders before investing but expect you to dish them out a check after a 30-min call.
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