Venture capitalists, at least those who are able to stay in the course, are a rare breed. More than the money, it takes a lot of guts to engage in such a commitment. Here are a number of principles that are close to any venture capitalist’s heart.
Venture capitalism would entail a strong faith in the future. The reason venture capitalists seem to come up with the brightest ideas is that they are the exception rather than the rule. Most of the time, they think very differently from the rest of the lot, even being labeled as ridiculous. And yet, they succeed. This is because of their strong faith in the future of their project.
Another key principle that is natural to venture capitalists is a strong understanding of how technology works. The success of any venture always has to do with a good grasp of how technology lessens the work, and how well it is able to speed things up. This is all within the aim of letting the market know how much it makes sense for the company’s product to be included in their lives.
Venture capitalism would also entail taking a lot of risks. However, this is not the type of risk taking typical of profuse gamblers. These are all calculated. A venture capitalist should be rather cerebral when it comes to calculating risks, such that he is prepared with a number of concrete steps ahead of any conceivable scenario.
It may sound that such principles make success a rarity in the business. The truth is, success in here is indeed a rarity, and no one else knows this better than real venture capitalists themselves.
Gregory Lindae is an investment industry expert focusing on venture capital and private equity markets. He has worked with prestigious financial firms and is now currently working for The Dutch Entrepreneurial Development Bank in The Hague, Netherlands. For more on the industry, visit this website.