What makes a great Venture Capitalist?

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Wearing Patagonia Vests, Brooks Brothers Khakis and Allbirds sneakers does not make you a good Venture Capitalist. That’s just what is already expected from you. But if you want to stand out in the ecosystem, here are the top six traits I’ve observed most great VC’s have:

  1. Curious: In my perspective this is the main personality trait of a great VC. It’s the eagerness to learn all the time, the passion to learn about everything, and the ability to quickly grasp new concepts. Most VC’s are generalists, meaning that although the might have strengths and weaknesses, they know about many subjects. Most successful business leaders have a tendency for obsessive reading, and VC’s should not be the exception, especially since they need to understand the basics of most of the industries they’re targeting within their investment thesis.
  2. Humble: This one should be a by-product of their curiosity. A curious person is by nature, a humble person. If you’re arrogant enough to feel like you already know everything there is to know, you won’t try to research and learn new things. Great VC’s understand there are specialists (AKA founders), and these specialists might know much more about their industry/technology. Humble enough to recognize there are people with deeper knowledge, and curious enough to want to learn from them.
  3. Optimistic: If you’re not inherently optimistic, what are you even doing in Venture Capital, my man? This people are the ones that believe in change, and are hopeful that things (whatever they are) will get better. If you don’t think founders have the power to change the world, why are you even putting your money (or your LP’s, I should say) on them? It just does not fit.
  4. Analyst and Debater: This is where things get interesting. Although optimistic by nature, VC’s are also natural devil’s advocates. They’re great at analyzing and finding loopholes and flaws in the business model, technology, industry, regulatory compliance, etc., and not just to bash the startup or because they’re pessimistic about it, but because they want the entrepreneur and the startup to be bulletproof, before and after they invest. VC’s are hawks. They’re just so good at spotting small opportunity areas and targeting that.
  5. Networker: They must be networkers. Apart from knowledge, and skills, founders look for they’re preferred VC’s based on the network they can provide to the company; be it suppliers, clients, other investors, advisors, etc., a great VC must have a large rolodex.
  6. Strategic: They should be strategy geniuses in many ways; they should be strategic, when managing the firm, deploying capital to choose investments, and following-up with those investments. Just like poker players, VC’s must know when to deploy capital, and when to fold on the opportunity, in order to lose the least amount of money in order to win exponentially. Also, when helping portfolio companies reach their goals, VC’s should be strategic on what they can provide and help the startup with.

There are many personalities out there, and of course they would provide different value to their firms. However, these traits are the ones I’ve noticed the most, and the ones I like the most of Venture Capitalists.

I’m curious to know, do you agree with this? What others would you add/replace?

– VC.

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